Facing a $355,000 reduction in state funding compared to last year, Northern New Mexico College Interim President Domingo Sanchez said the College is facing a lot of uncertainty as administration pushes forward with its end-of-year budget process.
As a result of fluctuating and decreasing revenue and a reduction of higher education funding, last month, legislative leaders concurred that revenue estimates could be decreased in both Fiscal Years 2016 and 2017.
According to a fiscal impact report prepared by the New Mexico Legislative Finance Committee, the Legislature reduced funding by $31 million, in Fiscal Year 2016, in Section 10 of House Bill 2, which funds, among other agencies, higher education in the state. This equates to an approximately 0.6-percent across-the-board reduction for the state’s institutions of higher learning.
For Fiscal Year 2017, higher education was reduced by $20 million, or 2.4 percent, from Fiscal Year 2016 levels.
In a statement released Feb. 29, Gov. Susana Martinez said in response to persistently low oil gas prices, which continue to have an impact on the state’s revenue outlook, the budget appropriately reduced spending in the current fiscal year across most agencies of state government and reduces agency base budgets for Fiscal Year 2017, as well.
Sanchez told the Board of Regents at its Feb. 25 meeting that higher education had a difficult financial year and that the College could face further reductions down the line.
He said due to the nature of the short legislative session, which concluded Feb. 18, the College has a bit more time to work on budget projections due to the state by May 1.
“When you have a short session like we had now, it’s nice because you have a little more breathing room,” he said. “When you have a long session, you lose a month and you’re having to finish everything by at least early April, because you still have to leave room for any changes and you have to have it approved by the Board.”
Sanchez said one of the major fiscal challenges the College faces is the reduction of funding from the state, coupled with large increases to the College’s insurance. The College’s total operational budget is approximately $30 million.
According to the final amended version of HB 2 released by the Legislature, the College’s appropriation to its General Fund, for instruction and general purposes, is $10.4 million, with $262.2 going to athletics, $247.7 for nursing expansion, $146,000 going to science, technology engineering and math and $121.7 going toward the College’s Veteran Center.
This is down from the previous year’s overall general fund appropriation of $10.8 million.
“We saw a fairly significant reduction,” Sanchez said. “Ten million sounds like a lot, but when you get it cut by $355,000, that’s a huge hit.”
Sanchez said as of March 11, the College’s budget process was 50 to 55 percent complete, and approximately 98 percent of all budget hearings with staff had also been completed. He said he met with all the department heads and looked at how to reduce expenditures. One way this is done is by tapping into vacancy savings and unspent money from positions that were not filled.
“What we do is we invite all the departments and we look at the staff and expenditures that they have and talk about them,” he said. “There is a lot of potential demand on the few dollars that we have, so I need as much information as I can get, so that I can come back and revisit areas that are really critical, that we’re going to get hurt by if we don’t address those within the operating budget.”
Board of Regents President Rosario Garcia said even though the budget is tight, the College’s administration is used to running the institution on fewer resources, compared to bigger colleges in the state. She said she does not anticipate the College raising tuition rates or cutting any instructional programs.
“We’re trying not to go that route,” she said. “We are trying not to cut any more academic programs.”
Garcia said administration cannot make a final determination until the budget process for this year is complete. Although enrollment at the College has remained stable throughout spring, Garcia said College officials expect a spike in the upcoming fall semester.
“Typically there’s a spike in enrollment,” she said. “If that is how it is again, we are looking at an incline.”
She said enrollment is guaranteed not to go up for students who enrolled in the College last fall.
Full-time tuition for the fall 2015 semester was at 707 with total enrollment at 1,052. Enrollment thus far for spring, has dipped to 1,038.
Men’s basketball coach and Athletic Director Ryan Cordova said fall to spring retention rate this year was 98 percent, the highest the college has ever had.
Cordova attributes the spike in the retention rates to the College implementing a semester-long first-year college experience course for incoming freshmen, which helps them feel more comfortable going into their second semester.
Cordova said the budget for Athletics was reduced by $6,500, but the institution, as a whole, has ways to deal with the shortfall, as does his individual department.
“As an athletics director, I know I have a $6,500 shortfall in my budget,” he said. “I can anticipate that. I’ve already cut $5,000 out of my budget. I only have to come up with an additional $1,500 and that is very manageable.”
He said one way to make up the deficit is for the College to play bigger programs like Fort Lewis College, New Mexico State University and San Angelo University of Texas, which pay the College to offset travel expenses with game-guaranteed money.
“That’s why it’s hard for us to have a great winning percentage,” he said. “Playing against these schools that are tough to beat.”
Sanchez said two grants critical to staffing and other needs of the College are set to expire, the Title V Éxito and Avance grants.
Although these grants are critical for funding services at the College, Sanchez said the institution can reapply for these funds, but there is sometimes a stumbling block imposed on funding.
“With these grants, my understanding is some have a waiting period,” he said. “In some cases, some require to wait one or two years before you can reapply. There is a lot of uncertainty when you have that type of reliance on grants for your staffing.”
Sanchez said he does not have the time to wait to reapply for the expiring grants.
“I don’t have the luxury of waiting to find out if we can reapply for them,” he said. “I gotta see if I can do something with the resources that I have.”
Sanchez said administrators will spend the next couple of weeks working hard on estimates of how they think the College will end the year, because that plays a big role in terms of planning and filling the fiscal holes.
In addition to tapping into vacancy savings, College officials have the option of raising tuition and fees, and cutting into expenditures at the various departments and instructional programs.
“We try to re-purpose positions,” he said. “We have to weigh the pros and the cons because some areas don’t necessarily lead to revenue.”