As of Jan. 1, Illinois Central College was waiting on more than $3 million from the state.
Spoon River College in Canton was waiting on almost $1 million.
Carl Sandburg College in Galesburg also has a little more than $1 million coming. Eventually.
Halfway into the fiscal year, Illinois’ 48 community colleges should have received a total of $168.7 million in state funding. They’ve received $33.2 million. Put another way, the state has only paid community colleges about 20 percent of what was due between July and December 2012.
When it comes to paying bills, the state of Illinois can do what students can’t for tuition - delay payments because it doesn’t have the money.
The state continues to be about six months behind in paying its obligations, said Ellen Andres, chief financial officer of the Illinois Community College Board, the state’s coordinating board for community colleges. “That’s the same as last year and last year was the worst.”
Community colleges’ share of the state’s unpaid obligations amounts to a drop of the total $6.6 billion in backlogged payments.
In general, community colleges rely on state funding less than four-year public universities and other agencies. But declines in other revenue sources, combined with state funding cuts and the payment backlog, put a financial strain on the state’s primary provider of affordable higher education and workforce development.
Unlike Illinois’ public universities, community colleges also raise money by levying taxes. But flat property values, or in the case of rural communities, low property values, don’t offset the revenue crunch, leaving tuition increases as community colleges main option to overcome shortfalls.
“Essentially the state is telling us, without saying it, that we’re going to put the costs on the backs of students rather than ante up the money,” said John Erwin, president of Illinois Central College.
For community colleges, the state’s late payments are like waiting on a paycheck. But they’re never sure when it will arrive. While they wait, they borrow or use their reserves to maintain cash flow, which can eat into fund balances, potentially lowering their credit rating as has already happened to the state of Illinois.
The impact is not always as obvious as a tuition increase. To deal with slow payments, colleges conserve utility costs, scrimp on capital improvements and forego unnecessary travel, looking to operate more efficiently. They may not offer as many sections of a certain class, meaning larger class sizes and smaller staffs.
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ICC officials say the college’s decades of strong fiscal managements helps weather the state’s financial crisis. But the recent decision to move downtown campus to the North Campus along University is an example of how the college is trying to cut costs by operating more efficiently.
Spoon River’s staff totals have dropped from a total of 158 in 2008 to 138 in 2012, through a combination of attrition and unfilled positions.
The state’s financial problems have forced colleges to become stronger and more efficient, said Spoon River president Curt Oldfield. “But at some point, even those measures don’t offset the lack of revenues coming in.”