IF NORTHWEST Community College was a business, chances are it would have already slid into bankruptcy protection at the least or face complete closure at the worst.
A pattern of annual surpluses, the last being just over $1 million in 2008-2009, has instead become one of ever increasing deficits.
For the 2009-2010 budget year, the deficit was first pegged at $568,887 and then revised at $719,268.
The deficit broke the million dollar mark at $1.156 million for the 2010-2011 budget year and now, despite what the college describes as vigorous cost cutting, is to be at least $1.6 million and could be as high as $2 million by the time the books are closed for the 2011-2012 budget year on March 31.
The college gets the majority of its money from the province, a sum that has held steady in the $21 million to $22 million range for several years, making up approximately 70 per cent of its budget.
The challenge has been in what college president Denise Henning calls soft dollars, money for specific programs, which may exist one year and not the next.
Federal government contributions, for example, which stood at $2.1 million in 2009 fell to $688,000 in 2010 and to just $65,000 last year.
At the same time, revenue from everything from the college’s cafeteria at its main Terrace campus to tuition fees to programs, which are expected to be financed completely by student fees and other charges, hasn’t materialized.
The college has already cut its wage costs, dropping approximately $1 million in payroll from 2010 to 2011, and it has cut in non-salary areas such as travel and advertising.
Still, it has to contend with wage increases called for in its collective agreements, inflation and, for instance, losing $600,000 from a provincially-provided maintenance budget that was once $800,000.
Henning’s pretty clear that the only step left in a budget where salary costs are by the far the largest line item is a round of severe layoffs which she says will affect everyone from clerical support to the executive ranks.
“We’ve literally cut to the bone [but] we’re not sustainable,” said Henning. “Everyone has been giving until it hurts.”
The college has already told its unionized workforce, as required by the provincial Labour Relations Board, to expect significant changes this spring.
It’s part of a three-year arrangement the college has reached with the provincial government to eliminate its deficit. By provincial law, it has to balance its budget every year. And it cannot dip into any money it might have saved from previous surpluses to cover current shortfalls.
Most of the job losses are to take place this coming fiscal year, which begins April 1, in a bid to eliminate the majority of the deficit and those employees who will be laid off should know their fate by the end of February. The plan is to have a smaller deficit the following year and eliminate it altogether by 2014.
Exact job loss numbers aren’t available yet for the approximately 600 full and part-time college employees.
But Henning is already describing as “challenging” the amount of money the college will have to spend on severance pay and other monetary costs associated with cutting its payroll.
But she says there’s no choice if the college is to continue operating and remain fixed on its goal of educating people.
“If we are to have a sustainable and vibrant institution, you have to move forward. You make the cuts you need,” said Henning.
“We have very smart and gifted and talented people. However, we cannot continue to do business this way,” she added of the college’s payroll.
Making the majority of the cuts this spring provides certainty for employees as opposed to people not knowing if they will lose their job this year or next, Henning said.
“Here’s the situation,” said Henning of her approach. “You fix the situation and you grow.”
What’s going to be left at the end is a leaner college doing fewer things, she adds.
“We’re going to narrow our focus but broaden our depth,” Henning said.
What that means isn’t known yet, but Henning said it involves the results of a tour she and senior executives did last fall in asking residents in the region for their ideas on what kind of services the college should provide.
In a week where layoff rumours and other bad financial news about the college began to surface, it played host to a provincial government session on planning for job growth in the region based on several significant projects already underway or about to start.
One of the questions posed at the Jan. 30 session was how the region could supply the people and skills need to work on those projects.
New Democratic Party MLA Michelle Mungall, who is the critic for advanced education, said it was ironic that at a time the provincial government is promoting jobs and skills, it is willing to have cuts affect the college’s ability to provide the training needed.
“I’ve just got to say this is an inappropriate way to govern,” said Mungall.
“What we’re going to have is people without jobs and jobs without people.”