Message from the Chancellor

Dear MCC Colleagues:

I fully appreciate that these are anxious times for you as we continue to analyze MCC’s financial condition.  We have serious decisions to make that will impact you, your families and the future of MCC.  These decisions are ultimately my responsibility and whether you agree with them or not, I can assure you they will be made only after having listened to the thoughts and concerns that have been brought forward, and exhaustive analysis and projections of data.  As I have stated in my many visits to the campuses and with the shared governance groups, my primary objective is to ensure that we create opportunities for student success by providing unsurpassed service and affordable education, preserving competitive pay and benefits for our employees, maintaining the quality of our facilities, and guaranteeing the long-term fiscal viability of MCC.

The reality of our financial challenge is that we are facing a growing budget deficit in the current fiscal year (ending June 30, 2011), which is now projected at approximately $3.3 million.  There are multiple factors that comprise this $3.3 million deficit including increased personnel costs, uncollectable accounts receivable, increased Americans with Disabilities Act (ADA) expense, the loss of federal grants, less projected enrollment income, less projected tax revenue, underperforming investment income, and increased legal expenses. 

In the short-term, the Officer Team continues to reduce costs and adjust plans to reach a balanced budget by the close of the fiscal year (June 30^th).  At the same time, considerable work has been done on the FY12 budget (which begins on July 1, 2011) and with what we know today, we are projecting a budget shortfall of approximately $2.5 million.  While we will not know what our state appropriation will be until the end of May, we do know that whatever the amount, it will not resolve our long-term financial challenges.  Quite frankly, the actions we have taken these last several years have turned out to have only been “band-aid” solutions applied to financial hemorrhaging. 

We must break this deficit cycle with comprehensive solutions.  Managing long-term costs and our debt service are two of my biggest concerns.  I have begun working with the Officers and the Chancellor’s Cabinet to review our outdated budget allocation model.  Institutionally we have lacked an overarching focus as to what our “main thing” is.  If we can agree that our main thing is the success of our students, we can begin a drill-down and integrated process of planning and budgeting.  Last week, I met with the Strategic Planning Council on this very topic.  After thoughtful discussion and input the committee agreed to accept my challenge to revamp our strategic plan to squarely focus on student success, which will guide our budget decisions.

In the next few weeks I will be making a recommendation to the Board of Trustees regarding a financial plan to balance our budget and provide long term financial stability for MCC.  The bottom line is that MCC was on a financial high for a number of years during which appropriate budget decisions were made concerning benefits, perquisites, acquisitions and capital improvements.  The financial reality of MCC, the state and the nation have vastly changed.   We have to change how we manage our operational costs in a way that enables us to continue to provide competitive benefits and wages to our employees, ensures we are focusing our resources on the right things, and maximizes our efficiency and effectiveness of existing resources.

I am in the final stages of reviewing all the financial projections of our accountants and the recommendations from the Chancellor’s Budget Response Team (BRT).  I have and will continue to study and give due diligence to every option available.  I sincerely appreciate the time and effort members of the BRT devoted to deliberating budget data and will weigh their recommendations carefully.  It is my responsibility to make the final recommendations to the Board of Trustees and I do not take this responsibility lightly.  I will make my recommendations to the Board in May and I assure you that I will not shy away from any decision I believe to be in the best interest of MCC that guarantees our commitment to student success, long term financial health and my commitment to you to keep the doors open.  I will notify you of the Board’s final decisions and my recommendations soon after the next board meeting.    

Thank you for everything you do each and every day to make MCC the incredible place it is.  I am dedicated to serving you just as you serve our students and communities.

Sincerely,

Mark