Fat Pensions and Dubious Results at California Community Colleges

Dec 11, 2016 by

By Marc Joffe –

Among progressive politicians, community colleges have recently taken on an iconic status. These are the scrappy institutions battling income inequality one mind at a time – helping lift underprivileged young strivers into the middle class. The result has been a drive to subsidize these schools, often without regard to their cost-effectiveness. Among the beneficiaries are retired community college administrators, who receive annual pensions upwards of $300,000.

Last year, the Obama Administration started a campaign to make community college free, dispatching Second Lady Dr. Jill Biden to promote the idea in California. During the presidential campaign, Hillary Clinton echoed the president’s commitment, while Bernie Sanders doubled down, proposing to make all two-year and four-year public colleges tuition free.

But with Democrats losing at the national level, free community college tuition will have to remain a state and local project. San Francisco, ever the progressive pioneer, has been planning to use revenue from a property transfer tax to cover the cost of attending its community college, known as the City College of San Francisco (CCSF). But the city’s budget has been thrown out of balance by voter rejection of a sales tax increase and the expected cost of battling the incoming administration’s plan to deport undocumented immigrants. Now supervisors are debating whether San Francisco can afford the $9 million annual cost of making CCSF free.

Perhaps if City College were run more efficiently, the city wouldn’t have to cover the nominal $46 per credit that students now pay. In Fiscal Year 2015, the district spent a total of $307 million to educate 23,545 full time equivalent students – which works out to over $13,000 per student.

Employee retirement costs played a key role in the heavy spending: the district contributed over $15 million to its three pension plans and incurred $7 million in other post-employment benefit costs. That is considerably more money than the proposed city subsidy.

The college’s pension contributions fund current and future retirement benefits – and some of those benefits are quite generous. In 2015, 47 CCSF retirees received annual CalSTRS pensions over $100,000.

The single biggest pension went to former Chancellor Don Griffin, who pulled down almost $277,000 in 2015. That’s enough to pay the tuition for 200 full-time students (taking 30 semester units at $46 per unit). Griffin retired amidst an accreditation crisis that nearly led to the college’s closure. In 2006, the Accrediting Commission for Community and Junior Colleges found CCSF deficient in several areas. Six years later, when Griffin was retiring, ACCJC conducted another review and concluded that the college had not adequately addressed its concerns. ACCJC would later decide to pull CCSF’s accreditation. Only the federal Department of Education’s intervention kept the college open.

In addition to the CalSTRS pensions, some San Francisco city employees bulked up their pensions by teaching part-time at CCSF. Two retired fire safety experts – Frank T. Cardinale and H. Brendan O’Leary – received pension payments exceeding $200,000 in 2015, partially as a result of their part-time work at CCSF.

It might be easier to accept these generous pensions if the institution was producing stellar results. But that is not the case as evidenced by the accreditation crisis and the fact that less than one-third of full-time entering freshman receive an Associate’s Degree within three years.

Generous community college pensions are not unique to San Francisco. Statewide, about 2200 community college retirees received pensions exceeding $100,000 last year. The single biggest 2015 pension went to retired Rancho Santiago Community College District chancellor Edward Hernandez, Jr, – who received just over $310,000. RSCCD is located in Santa Ana.

So while elected officials now place community colleges on the pedestal alongside Mom and apple pie, these institutions are far costlier. Taxpayers should demand their money’s worth from community colleges: one way to make these schools more cost effective is to cap the lavish pension benefits they now offer.

Source: Fat Pensions and Dubious Results at California Community Colleges – Union Watch

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