In the face of a $2.5M deficit, SBCC strategizes how to cut costs
The Santa Barbara City College plans on tightening its belt with budget reductions that are projected to be about $2.5 million.
The school’s board met Thursday to discuss the adopted budget for 2019-2020 academic year. So far, SBCC faces a total deficit of more than $4.7 million. It seems like the deficit will be around beyond this academic year.
“So we’ll still be focused on doing five-year projections as soon as we can get more information on where we’re headed,” said Lyndsay Maas, educational programs’ vice president. “That’s very important that we bring our budget into a balanced budget in the near future, but we’re not going to be able to do it without doing so much more dramatic cuts in ’19/’20.”
What are some things on the chopping block in the school’s attempt to cut down?
A hiring freeze may be implemented, and the savings expected from the freeze approach $1 million. During a hiring freeze, the school will only hire critical positions.
The overtime budget may also fall by nearly $100,000, which would be a 75 percent decrease.
Cell phone stipends of staff may be eliminated.
Travel and conference budget may be taking a dive from $500,000 to $50,000.
The forecast that Ms. Maas presented Thursday afternoon operated with a few assumptions. The assumptions are as follows:
Property tax revenue increases by 3 percent.
Education Protection Act revenue remains at $11.2 million.
The school will spend about $50,000 on reclassifying staff.
The state unemployment contribution rate and the state workers compensation insurance rate remain the same.
To operate with the expected deficit, the school will most likely be dipping their hands into the reserves.
“We would be needing to rely on reserve in ’19/’20 to keep us whole,” said Ms. Maas.
Some on the board, though, would rather reduce the budget without using the reserves.
“I don’t think we should be pushing this on the reserves,” said Marsha S. Croninger, a trustee on the board. “I think we should be balancing this year’s budget this year.”
Another board member, Craig Nielsen, agreed with Ms. Croninger.
“I’d also like to see what kind of cuts we have to make,” said Mr. Nielsen. “When you got 90 percent of your budget, 91 percent whatever it is of our budget, is people, you got to cut those costs. We have to cut.”
Mr. Nielsen, however, proposed a gradual approach to cutting staff.
“Do we have to be cruel about it and do it instantaneously? No. But we have very limited amount of reserves that we need for other purposes like genuine, one-time serious occurrences that could come up that we need the reserves for.”
The school has until Sept. 15 to adopt a budget.