Springfield Chamber Weighs In on Lane Community College’s Budget Deficit

October 27, 2023

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Lane Community College is facing a FY24 budget shortfall of $3.8M and another $4M shortfall in FY25. The Board of Education must take immediate, necessary, and substantive measures to correct the College’s structural deficit and put Lane back on solid financial standing.

WHY WE CARE
Lane Community College’s role as a leading workforce training institution contributes greatly to our region’s future success. The Springfield Chamber represents regional employers who care deeply about this issue and have a stake in the College’s future. In 2020, the Springfield Chamber endorsed the LCC Bond Measure, helping the college secure $121.5M for critical infrastructure upgrades, operational efficiencies, and expansion of sorely needed workforce education programs such as healthcare professions, advanced manufacturing, technology, and the trades. The Board of Education, in turn, promised fiscal stewardship.

WHAT’S THE DISCUSSION

A pattern has been established of expenses at the college exceeding revenues for years.

The LCC Board of Education adopted the FY24 budget last spring, containing what is now a 3.8-million-dollar gap that must be closed before the end of the fiscal year. Even after closing the 3.8-million-dollar gap for FY24, it appears that there will be another gap in FY25 of 4 million dollars.

Higher enrollments and the possibility of increased revenue from other sources will not solve the structurally imbalanced and long-standing operating deficit.

The College’s Administration has proposed several measures to address operational gaps. At this time, it appears that these reductions to fill part of the 3.8-million-dollar gap are unlikely to be approved by a majority of the Board of Education.

Moody’s recently downgraded their rating for LCC, noting a) the board is not following its own policies with regard to maintaining reserves; b) the need for “more structurally balanced operations”; and c) failure to correct these issues is likely to lead to another downgrade next year by Moody’s.

In March of 2023, higher education financial consultants presented findings to the Board of Education and, using a nationally agreed upon set of ratios, concluded the College rating to be one of “Barely Surviving.”

SPRINGFIELD CHAMBER POSITION
The Board of Education has a duty to exercise fiduciary oversight, support the Administration’s strategy that addresses the structural operating deficits, and to secure the long-term financial standing of the College.

Read the full written testimony HERE

WHAT YOU CAN DO

Write the Lane Community College Board of Education (contacts provided below)

Sign on in support of the Springfield Chamber’s testimony by adding your name and/or organization (either of which are optional), H E RE. Testimony with community and member support will be resubmitted to the LCC Board of Education.