Amid warning signs, City Colleges freezes tuition and property taxes

A City Colleges board under new leadership approved a $443 million 2018 budget on Thursday that holds the line on both property taxes and student tuition, amid warnings about declining enrollment and depleted reserves.

The Civic Federation endorsed what it called a “prudent plan to begin to stabilize” district finances after delaying capital projects and “drawing down its reserves by $59 million to cover operating losses” triggered by the marathon state budget stalemate.

But the federation warned that declining student enrollment may continue to impact City Colleges finances and that “ongoing gridlock” in Springfield could lead to “reduced state funding for higher learning.”

To insulate itself from those outside pressures and build back its depleted reserves, the federation is urging City Colleges to consider “indexing tuition and fees” and tying them to an “annual escalator.”

That would “smooth charges and fees over several years rather than having uneven impacts on students,” the federation’s report states.

City Colleges Chancellor Juan Salgado acknowledged that an annual escalator is “something that we should examine during the course of this year as we’re looking at our overall tuition pricing.”

“We’re certainly not closed to the idea. But we’re also not at the point to say that’s the right thing for this institution to do now,” he said. “I appreciate the Civic Fed’s perspective always. The suggestion that they’re making is one that we’ll look at as we look at our overall tuition situation over the next year.”

Salgado said there is no “silver bullet” for the enrollment decline by 7.1 percent or 2,681 “full-time-equivalent” students this year, with another 5 percent drop projected in 2018.

But he argued that the return of MAP grants, the use of “ambassadors” to spread the word about City Colleges, and an even stronger partnership with Chicago Public Schools will slowly but surely reverse the enrollment decline.

“We’ve focused on it from the moment I got here,” he said. “We’re trending in a positive direction, meaning that we’re gonna turn around the declines we’ve had over the last couple of years that have been due to a number of different factors, including the uncertainty in MAP grants and the uncertainty in state funding overall.”

Four months before now-retired City Colleges Chancellor Cheryl Hyman announced her delayed resignation, faculty members took a vote of no-confidence in her.

They were alienated by the chancellor’s dictatorial management style, by program consolidations they viewed as callous and by a tuition increase that penalized part-time students who make up the backbone of the system.

That’s why Salgado plans to proceed with caution on the tuition front while selling a number of assets — including its downtown headquarters — to replenish its reserves.

The 2018 budget also includes 120 fewer administrators and a 10 percent cut in compensation for “senior leadership.” That includes eliminating “100 percent pension contributions and medical reimbursements for district officers.”

Without an increase in property taxes, the gross property tax levy for City Colleges would remain at $125.3 million.

But the Civic Federation is urging the district to push for a change in the “community colleges equalization formula to more fairly fund” city colleges located in counties covered by property tax caps.