Progress on the budget

Keeping the line of communication open across campus is a concept Interim President Dr. Melinda Treadwell has been dedicated to ensuring since her arrival.

On Wednesday, Oct. 4, Chancellor Dr. Todd Leach and Treadwell held a campus-wide meeting to discuss the progress the administration is making with taking on the 2.4 million dollar deficit KSC is facing.

“The purpose of getting together is just to make sure that we are all getting the same messages…we committed to coming back in the fall and making sure we are sharing what’s going on and make sure everyone has the information that we have. Frankly, last time, it was clear that there were some hiccups in the channel of communication in terms of people who need to have certain information or the understanding we are getting,” Leach said.

Brendon Jones / Equinox Staff

Brendon Jones / Equinox Staff

He continued, “Part of this is just making sure that everyone knows the work that’s going on, where we’re at, what we’re trying to accomplish. I know everyone is really working hard around the financial challenge [and] that if you weren’t here in the summer to hear about it you have certainly heard about it by now or even read about it.”

Leach said the financial situation is larger than when the budget was first looked at. He continued to explain that the revenue numbers were lower than what had initially been expected. ”It’s been a lot of work for everybody and I realize it’s difficult when you’re trying to make a lot of changes and you have limited resources. It is a problem that we really have to work together, it’s not just a slogan,” Leach said.

The chancellor’s senior team is on campus weekly to address this issue, along with him being here at least once a week. He said by having frequent visits, it has allowed them to cut consulting agreements and adjunct senior administrators.

“As of today, just from that, we have saved about a half million dollars, so there’s a lot to be done and we have to do it together. We have to work hard to get there and, meanwhile, make sure that everyone has the same context,” Leach said.

He continued to say even though KSC is in the state college system, we get less than 10 percent of our funding from the state. The Board of Trustees looks at the margins the institution generates each year. The board governs the four institutions in the system and it’s a group of people that are looking at what’s best for the state. Leach said, “They understand what is really important for our system institutions is having the best value composition we can have. That means it’s not just about the lowest price, it’s about ensuring the quality, that our institutions are attractive and trying to make sure we have that balance.”

Leach said the board uses “an industry standard of three percent that we try to target for which those margins, that three percent, turns into the strategic funds and the investment funds that we use to build new dormitories and for other purposes. At this point, where we are now, Keene’s loss has given the flat margin set that we have at Plymouth and just the market overall. We are pretty much operating at breakeven as a system, which means there is very little going into that strategic fund, very little that we can work with.”

Another number the board has to look at is the Unrestricted Funds to Debt (UFR). That number is able to tell the board how much they have to borrow in capacity. “The state uses the same thing, and the industry standard there is about 50 percent, we are just slightly above that and if you look out over the long-term across five years, we don’t have a lot of capacity there and without margins, it’s not growing. That means the board has to be really strategic about its decision-making and figure out if we have certain state priorities and needs, how are we going to support those? And given the closest flat margins and given the close to 50 percent UFR means we can’t afford to sustain deficits, so there is an urgency to ensuring that all of our institutions are financially sustainable and financially healthy,” Leach said.

Leach emphasized on the need to keep the workforce in New Hampshire. He explained students won’t stay here if the college isn’t in a place they want to be after graduation. Looking at cost is a major concern for students and parents while searching college options and Leach acknowledged that. “The cost of higher ed over all has gone up faster than inflation, faster than wages; that’s not sustainable. At some point, we run into a tipping point and I think nationally, we are probably at that tipping point, so the board is really focused on trying to keep costs for the students to at least inflation levels, if not, less,” Leach said.

With the approved budget already being a $2.4 million deficit, Leach said everyone’s hard work and commitment is focused on protecting the student experience, which has been a top priority.

Bringing enrollment up

In the long term, Leach said the college needs to look at where it is enrollment-wise. He said currently, KSC has 3,750 students, which is smaller than what they think the campus can handle. However, the total number of students the institution is looking to enroll is still unclear. “It’s a very tough, competitive market and at the same time, could we be doing things that could be more attractive for students, better around enrollment management, that could bring those enrollments back up?”

Leach and Treadwell are combining their efforts to figure out what it is going to take to bring enrollment numbers back up to where they need to be. Looking nationally, Leach said the demographics “[are] not a pretty picture.” He said these demographics are not favorable for college students, especially in the New England region. The main goal of this is to help keep New Hampshire students in New Hampshire when they pursue a postsecondary education.

“We are seeing some scary trends here.  [A] 27 percent decline predicted over the next 15 years, that’s pretty significant. If we look at how do we get students from other regions because that’s the kind of strategy that’s been more challenging because in every one of these states around us, you can see they’re losing students and they’re trying to hang on to what they have. We see a free college program in New York, see free community college in Rhode Island, you see Maine trying to match the in-state tuition of our flagship here. That’s what we are competing with,” Leach said.

Another issue Leach addressed with enrollment is individuals are beginning to focus around workforce rather than getting a college degree. He said these young adults are shifting towards trade school or short-term credentials– whatever is fastest and cheapest. Leach has had conversations with the legislature about KSC being flat-funded for four years, which makes it difficult to lower tuition, and it’s more difficult to freeze tuition, which then in turn makes it harder to keep students.

Leach said, “We really have a different shifting orientation towards what students and parents are looking for when they’re looking at choices. We have a terrific ranking here at Keene with the employability which is fantastic. We’ve got to get that message out there because students and parents are looking for what’s going to help them career-wise.”

He continued, “Employability and career choices are playing a bigger and bigger part of their decision in the process. I’m sharing this with you because this is a part that the board has been looking at for a number of years; there’s still graphic trends that shouldn’t be a surprise to us. There are fewer high school graduates and we have fewer people entering high school. We have fewer people graduating from junior high school. We have seen this trend coming and we looked at this stress test approach, trying to predict whether colleges will be able to weather some of this demographic change and stay strong. Every one of our college presidents came forward and said, ‘No problem.’”

Leach said if KSC doesn’t bring its enrollment up next year and the enrollment continues at the rate it’s at, the number will continue at a steady pace.

This will be “concerning,” according to Leach. Another issue is the retention at the college. Leach said the retention needs to be a main focus again for KSC because it has gone down four percent in one year. He added that retention is a campus-wide effort in getting students involved, engaged and make sure students are enjoying the campus environment. “We want our students to be happy they’re here, we want them to be satisfied with the education they’re getting, we want them to recommend us, but at the very least, we want to make sure we get them through to graduation,” Leach said.

He continued, “The reason I come to graduation here every single year is because it’s really what we’re about. I want to see hopefully most, almost all, of the students who clapped in ultimately graduate at the end of four years, and that’s a challenge for all of us. We have to figure out how we can get better at that, how we can address the issue. The one thing I would ask for everybody, administrative, academic, whatever your role is, just to really ask the question, ‘Why do we do this?’”

KSC’s strengths

Leach not only spoke of the challenges that KSC is facing, but also the strengths our community and campus have. “I think spending half of my summer here walking around campus and talking to people, it’s even more clear to me the strengths Keene has. I don’t believe Keene should be in the situation that it’s in…there are just a lot of strengths here. I think it’s arguably the best value in the state when you look at the cost of attendance and what you get for that,” Leach said.

Both Leach and Treadwell are looking for help from all campus community members to make improvements. He emphasized the fact that everyone will be working on this problem together. “We have made a lot of progress and I do want to make sure that I do highlight that because it is really a good news story that we have a budget we can work from now. We have a number of things to entice now that will help us as we balance our budget next year. We haven’t lost the ethos of the college. As we look at how people view Keene, our service, sustainability, the issues that I think are really core to the college, those are the things we can go off of,” Leach said.

Looking forward 

Treadwell said she believes Leach is attempting to explain to KSC that this circumstance we have fallen into is not unique to our campus, but is more severe than the other institutions in the university system.

She said, “It is something we need to pay attention to and as I have shared in campus meetings we have been very focused on hitting milestones and getting the approved deficit for this year. I want to be very clear so everyone knows where we are and where we’re heading.”

Treadwell overviewed the three-phase approach for this year’s work around the budget. Based off of the three phases she is currently implementing, Treadwell has begun to utilize two disappearing cabinet task forces. One is focused on enrollment strategy and is anticipated to have a recommended enrollment right-size target for KSC by the first weeks of November.

“What is the right size for Keene State? Thirty-five, 37, 38, 4,000? What is it based on our academic programs, residential life and based on a more aggressive recognition of what real revenue can be, what can we support from a staffing perspective? We have a number of things in place and what I have requested… is a summary of things we didn’t do last year, that we aren’t doing this year and things we didn’t do last year that we are doing this year. What is different? So we have better projection of getting to our enrollment for the next fiscal year. Also, where are there specific places for us to achieve it? What can we do to enhance the academic student experience to improve those numbers to the positive again?” Treadwell said.

Treadwell’s expectation by April is for our community to come up with a two-to-five year window of goals.  The second task force is on organizational realignment on the budget. Treadwell refers to this is as, “the cost-side of the house.”

“On the cost-side of Keene State’s work, by Nov. 15, we expect to recommend academic realignment here at Keene State. What that means is how can we collapse some of our academic offerings into a different leadership structure that contains cost? As I mentioned in the campus-wide meeting we had, we’ve had CAVs reports, we’ve had a lot of conversations about what Keene State should look like. The task forces and communities have never been in a position to attend to those recommendations based on financial circumstances, a financial reality for this campus,” Treadwell said.

By Feb. 1, Treadwell is looking for a recommendation on staffing and support realignment from the entire campus get us to the approved budget for fiscal year 2019 (FY19.)

“What do we need to look like? Again, no one will be surprised. There will be conversations and opportunities for people to engage in those discussions and I’ll be very clear about what is happening and we will function as a community,” Treadwell further explained. Cabinet members, expanded members from across the campus and Treadwell worked last week to define KSC’s “elevator speech.”

“We have talked a little bit about this, but we simply can’t keep saying what we have always been saying about Keene State. It’s not translating to parents and students at this time, sadly. We can’t continue to just hold the way we have been communicating as a way moving forward. We have to have a value proposition for Keene State that translates to the audience we are trying to reach: parents and their students. We are trying to communicate who we are,” Treadwell said.

Treadwell said she is going to leverage some strategic resources. “We have a vacant line for a financial director right now. I’ve met with the team about this and I believe we have a team that has worked so hard in our financial aid office. We have a very important gap in that team for too long. I’m going to reach out to higher a temporary financial aid director to come in and help support our packaging and help support that team. We are also going to make recognition to the people who have worked so hard for the past several years and we are going to try to continue to hold that team strong even as we open a permanent search. The permanent search for a financial aid director will be open right away, but we will have an interim financial aid director that I will be bringing in in the next couple weeks.”

Treadwell said she believes she needs an outside source to come in and look at KSC’s strategies on enrollment and marketing communications. “We are going to bring someone in to do a very intense assessment within the team to identify needs for future investment for me and for the institution to help stabilize where we are with our marketing, communications and enrollment strategy teamwork,” Treadwell said.

Treadwell stressed the importance that KSC graduate students give them economic mobility. “The median income of $61,000 a year is much different than the income for a high school graduate. The career lifetime growth is differential, credentials are dramatically different for a college graduate versus a high school graduate. That’s our mission as a public institution, we should be helping individuals have economic mobility, so we need to get them to graduation,” Treadwell said.

Feedback from the campus community

Lastly, Treadwell addressed feedback she has heard amongst campus since the campus-wide meeting that was held in September.

“There is anxiety, and when I talked about organizational realignment this morning ,I’m sure I created more anxiety. Hold steady. We have to have conversations about these things. If I wasn’t being forthright with you about this, you would be surprised. You will be involved in the discussion. Each and every member of this community will be invited and engaged. You will not be surprised about the decisions we make, the decisions we must make. I have to lead that and that is my obligation, but I can’t do it alone. There are rumors out there about top down solutions. Faculty, you are not going to be surprised with an academic reorganization that descends from on high to you and your departments, I promise you that. We will have discussion,” Treadwell said.

Treadwell said she believes KSC has what it takes to face this challenge head-on.

“I was a part of this community for a long time and everything I feel on this campus since I’ve come back, we absolutely have the capacity to adapt to what is a challenging circumstance. The last institution I served, our total budget was $65 million and an $8.7 million dollar deficit and we cut it. We made it. We didn’t destroy the culture. This is a very important moment for us. I’m hearing your constructive feedback, I appreciate it and I am not tone deaf to it. Know that I am listening, know that I am engaging and know that I am trying to push, mentor, serve and support the entire team across the institution; it’s not just the cabinet, it’s the supervisors, directors, it’s the entire leadership of this campus that we need to work for and will,” Treadwell said.

She said she plans to hold community together through this difficult time. “We’ve got to hold community, so that means respecting each other, supporting each other, listening and hearing each other. Leadership is my responsibility, but it is not something on my own; you all have leadership as well and I am counting on you.”

Emma Hamilton can be contacted at ehamilton@kscequinox.com 

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