ERIC review: the impact of financial crises on access and support services in community colleges.

This review discusses the impact of fiscal contraction on community colleges. It explores how reduced state appropriations have adversely affected community college instruction and student support systems. It closes with the example of how fee increases in the 1990s lowered access to the California community college system and reduced transfers to the universities. The research shows that because instruction and student support services suffer when the budget is reduced, fiscal contraction can hamper the ability of community colleges to provide universal access.

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State revenue shortfalls, the result of the most recent economic recession, are prevalent throughout the nation. In order to cope with these shortfalls, many states are choosing to reduce spending in public programs and services, including higher education. After nearly a decade of abundant resources, many higher education institutions face a grave fiscal situation. In January 2002, The Chronicle of Higher Education reported that 36 states were anticipating budget deficits in 2003, and many had also reduced their higher education budgets mid-year (Hebel, Schmidt, & Selingo, 2002). In 2003, the University of Nebraska responded to declining state support by slating some of its academic programs for elimination and releasing some tenured faculty (Fogg, 2003). The state of Virginia cut the operating budget of its community colleges by 8% in 2002 and is expected to cut an additional 10% this year (Larose, 2003). In California, the state's record budget deficit has resulted in cumulative cuts of nearly 10% to the nation's largest community college system (Hebel, 2003; Mills, 2003).

Given the cyclical nature of economies, periods of reduced funding for public higher education should be expected, but they are not inconsequential, particularly for community colleges. The effects of budget reductions in state funding--whether large or small--are more profound in community colleges than in four-year colleges and universities primarily because the community college revenue stream is more homogeneous and dependent on state revenues (de la Garza, 2000; Education Commission of the States, 2000). Additionally, the community college emphasis on teaching to the exclusion of research activities results in few, if any, alternative revenue sources available to offset the impact of reduced state appropriations (de la Garza, 2000; Hebel, 2003; Mills, 2003).

Currently, the problem of reduced state revenue for community colleges is compounded further by enrollment increases. Rooney (2002) reports record enrollment increases in community colleges across the nation as students struggle to find affordable higher education. He also reports that enrollment increases of between 4% and 9% for fall 2002 were common in some state community college systems. Decreased state revenues, coupled with increased demand for instruction, have left many community colleges under escalating pressure to resolve the problem of serving more students with fewer resources.

Today's convergence of reduced state appropriations and increased demand for community college instruction is threatening colleges' ability to adhere to their missions and purposes, and arguably the problem is greater than ever before. Given these circumstances, an examination of the impact of prior fiscal crises on the missions of universal access and student support services is particularly relevant. This article looks to the past to illustrate the impact of fiscal contraction on access to community college instruction and support services, and explores previous responses to budget reductions, in particular enrollment management practices. Finally, the article discusses the impact of fee increases in the early 1990s on the California community college system in order to illustrate potential detrimental effects of increasing the cost of attendance on the missions of access and transfer.

Community Colleges' Mission, Students and Services

The impact of fiscal contraction on community college students cannot be fully appreciated without first understanding the students historically served by community colleges and their needs. In general, the student population at community colleges has been shaped by an expansive definition of access--one that encompasses the broad aspects of geography, affordability, academic preparation, educational objectives, and historic underrepresentation. Cohen and Brawer (2003) attribute the community college tradition of universal access to the American philosophy of opportunity for advancement for all individuals, regardless of social stratum, and to the mid-twentieth century initiative to establish localized institutions serving all of the educational needs of their surrounding communities. The pursuit of universal access and tradition of community service has resulted in community colleges enrolling a broad spectrum of students not likely to be served by other segments of the higher education system.

Students Served

In 1999-2000, a substantial proportion of all undergraduate students (42%) were enrolled in community colleges (Hoachlander, Sikora, & Horn, 2003). Among these enrollees, a sizeable number were from ethnic backgrounds considered historically underrepresented in higher education. In 2000, the National Center for Education Statistics reported that the percentage of minority students enrolled in community colleges was slightly over 34%, compared to less than 25% at four-year colleges and universities (Snyder, 2003). Hispanic and African American students comprised 14% and 12% of community college enrollment, respectively, compared to 7% Hispanic enrollment and 10% African American enrollment in four-year institutions. Further, the proportion of those who are first-generation college students or who require remedial coursework is substantial. A recent study of high school graduates entering community colleges reports that 30% have test scores reflecting mathematics competencies at the level of basic arithmetic operations, and 44% possess only fundamental reading comprehension skills with little analytical capacity (Hoachlander, Sikora, & Horn, 2003). Clearly, open access in community colleges has resulted in postsecondary opportunities for a significant number of undergraduates with diverse educational backgrounds and needs.

Student Support Services

The promise of open access, however, cannot be fulfilled without the corresponding community college tradition of providing student support services (Cohen & Brawer, 2003). Community colleges provide a substantial network of support programs aimed at facilitating the retention and achievement of at-risk and disadvantaged students. Grubb (2001) refers to this historic practice in the community colleges as an attempt to provide "a complete range of services to meet a variety of needs" (p. 12). Typically, community colleges employ multiple techniques and programs--consisting of placement testing, counseling and advising, supplemental instruction, learning communities, tutoring and skills labs, orientation, and first-year experience programs--in their effort to enhance student retention and achievement. Even though some of these strategies were developed for traditional college students, community college practitioners have often made these programs and services available to all of their students in order to improve student achievement, particularly where disadvantaged students are concerned (Goel, 2002).

In general, studies of classroom support programs and services for community colleges students suggest positive results for participants (Cohen & Brawer, 2003; Hagedorn, Perrakis, & Maxwell, 2002). Bridge programs and learning communities achieve a variety of positive outcomes for students, including better academic and social integration and involvement in college life, and participants often exhibit greater academic success than nonparticipants. Findings from an evaluation of Santa Ana College's Freshman Experience Program, a learning community designed as linked classes combined with counseling, include higher pass rates, greater persistence rates into subsequent semesters, more satisfaction with classroom learning experiences, development of study skills, and development of leadership skills and self-confidence for learning community participants than for nonparticipants with similar demographic characteristics (Rancho Santiago Community College District, 2003). Similarly, a study conducted at La Guardia Community College compared learning community students with a representative group of nonparticipants and found that learning community students had more positive perceptions of faculty, administrators, and other students, earned more credits and had higher grade point averages, and were more likely to express their intent to continue in higher education than were the nonparticipants (Tinto & Love, 1995). These are only two examples of how community colleges have been successful in developing programs and services that are aimed at improving student retention and achievement of educational goals. The tradition of student support services is evidence that community colleges recognize their importance in helping students achieve their educational goals.

The Impact of Fiscal Contraction on Community Colleges

Universal access to higher education is primarily accomplished through the nation's community colleges. It is largely because of the openness of community colleges that students from diverse backgrounds with a wide range of needs and objectives have gained access to higher education. Without community colleges and their efforts to facilitate student achievement, the promise of universal access falls short. It is essential, then, to understand how fiscal contraction hampers the ability of community colleges to provide universal access and student support services.

Reduced Access to Instruction

During economic downturns, state revenues decrease, and legislators, while perhaps committed in principle to the expansive definition of access shared by community colleges, show reluctance to fund fully such an inclusive approach (Cohen & Brawer, 2003; McCurdy, 1994). In California, for example, the difference between the amount of funds received from the legislature and the amount of funds required to implement fully universal access in community colleges, as specified in the 1960 Master Plan, is referred to as the "funding gap" (Burstein, 1996). During times of scarcity, community colleges are forced to subscribe to a definition of access that fits within the boundaries of their new fiscal reality (Cohen & Brawer, 2003). Thus, fiscal contraction by the state compels college officials to seek reductions in academic support services and instructional expenditures as well as partially compensate for revenue losses with tuition and fee increases to the extent permitted by state regulations.

When community colleges are forced to trim instructional expenditures, they do so by employing strategies that place controls on the supply and demand of instruction. Supply controls reduce the number of scheduled course offerings, while the demand control effectively reduces the number of students seeking instruction by raising the cost of attendance. Both strategies reduce enrollment and, by definition, access. It is important to understand the impact of each of these strategies on the community college student population.

Declines in Scheduled Offerings

Community colleges can limit the supply of courses by both reducing the number of classes offered in the schedule and by enforcing more stringent guidelines with respect to class efficiency standards or enrollment rates. Courses with insufficient enrollments are eliminated from the schedule after the start of the semester but prior to the college's census date (the date that the official enrollment count is recorded), often leaving students scrambling to find alternate courses. For example, in the California Community College System, colleges eliminated 10,500 class sections, for a reduction of almost 9% of all offerings between spring 2002 and spring 2003 (T. Nussbaum, personal communication, June 13, 2003). Hugget (1994) also provides evidence of the reduction in class offerings. She reports that American River College in Sacramento, California cancelled 51 class sections during one semester because enrollment did not meet the minimum threshold, and Santa Monica College, also in California, eliminated class sections from the previous year's schedule in an attempt to achieve budget reduction targets.

In their study of the Los Angeles Community College District, Hagedorn, Perrakis, and Maxwell (2002) identify flexible course times and offerings, including evening and weekend courses, as an institutional behavior that facilitates student success, particularly for nontraditional, low income, and disadvantaged students. However, during financial crises, community colleges are forced to curtail scheduling, thereby reducing flexibility for students. The California community college chancellor's office estimates that reductions in scheduled offerings led to nearly a 3% decline in headcount between spring 2002 and spring 2003 (P. Perry, personal communication, August 27, 2003). Decreasing the number of class sections and canceling classes that do not meet a minimum threshold of enrollment diminishes access by forcing students to compete for fewer opportunities to enroll. As enrollment competition increases, a proportion of students who previously would have been able to access instruction because of more flexible scheduling becomes shut out of the enrollment process entirely. Those shut out tend to be students with a heavy load of external commitments, such as work and family. In California, for example, the students who are not able to enroll due to constraints on the supply of courses are older first-time students who are more likely to have a heavier load of external commitments and reduced opportunity to enroll in classes (P. Perry, personal communication, August 27, 2003).

When colleges reduce their scheduled offerings, they seek to balance instructional expenditures with anticipated state revenues in order to eliminate funding gaps between the number of students served and the number of students funded by the state. For colleges that receive their funding based upon per-student funding formulas, accurately projecting enrollment is critical during fiscal retrenchment because falling below state enrollment targets means incurring greater financial losses. Thus, a critical component in anticipating future enrollment is estimating the impact of increasing the cost of attendance on the student population.

Increases in the Cost of Attendance

Increasingly, community colleges have raised the cost of attending their institutions as a way to counteract declines in state appropriations (Cohen & Brawer, 2003; Education Commission of the States, 2000; Phillippe, 1998). Yet while tuition and fee increases serve as an alternate revenue stream, the Research and Analysis Unit of the California Community Colleges (1993) shows that they also serve to regulate or reduce demand for community college courses. The effect of increasing the cost of attendance on reducing enrollment in higher education is well documented, as is the unequal impact of these increases on low-income students (Cuccaro-Alamin & Choy, 1998; Heller, 1996; Heller, 1998). Indeed, a study conducted by the San Diego Community College District revealed that tuition increases were in part responsible for an 8% decline in students attending colleges within the district (San Diego Community College District, 1993). The same study also reported that lower income students were less likely to enroll when tuition and fees increase. Enrollment declines due to tuition and fee increases were also reported in Miami-Dade Community College District and in the state of Texas (Brann, 1995; Texas State Legislature, 1992). The disproportionate effect of fee increases on low-income students is particularly problematic for community colleges because a substantial number of community college students are low-income, minority, and part-time students, all factors that are associated with decreased college attendance and persistence when tuition rises (Cuccaro-Alamin & Choy, 1998; Heller, 1996).

Although tuition and fee increases are sometimes offset by increases in the availability of financial aid, community college students are less likely than are their four-year counterparts to avail themselves of financial aid or loans to facilitate completion of their education (Cuccaro-Alamin & Choy, 1998). In his analysis of the impact of budget cuts on the California community colleges, McCurdy (1994) noted that while 60% of California community college students were eligible for aid, only 27% actually received it. It would appear that the preferred method of financing higher education for community college students is a combination of part-time college attendance, full-time work, and grants. Because continuing community college students are one of the most price-sensitive groups in higher education (Heller, 1998), they are more likely to stop out or drop out entirely when the cost of attending increases. Tuition and fee increases effectively diminish access for those students who exhibit more price sensitivity--typically low-income and underrepresented students (Choy & Berker, 2003).

Decreased Funding for Student Support Services

Given the proportion of first-generation and other potentially at-risk students attending community colleges, it is not surprising that colleges have gone to great lengths to respond to the needs of these students by creating a large network of academic and student support services. Increasingly, however, funding for new retention and academic success initiatives must come from program establishment grants or other temporary funding sources which, by definition, are not guaranteed (Cohen & Brawer, 2003). In California, for example, colleges have relied on Partnership for Excellence funds--a short-term, performance-based augmentation to annual state appropriations--in order to boost instructional and student support services. Sixty-eight percent of the state's total allocation for the Partnership for Excellence in 2001-2002 went to hiring more faculty, improving instructional support, expanding the number of counselors and education advisors, increasing hours of tutoring services and transfer centers, and building up bridge programs (Sheldon & Yong, 2001). In 1998-1999, expenditures in student services alone represented slightly more than 22% of total Partnership for Excellence spending, compared to slightly under 22% in 1999-2000, and 17% in 2000-2001 (Laurente & Sheldon, 2000; Sheldon & Yong, 2001). The community college investment of time and resources in student support services is significant when considered within its historical context. However, critics still question the adequacy of the overall resources for these services (Grubb, 2001).

Because part-time staff members such as tutors and counselors are overrepresented in academic and student support programs, these programs are extremely vulnerable to budget reductions. Frequently during fiscal contraction, colleges implement reductions in funds for part-time personnel, often as part of an effort to save as much of the instructional program as possible. This results in significant staff reductions for academic and student support programs. For example, at Cerritos College in California, funding for part-time hourly personnel in support services was reduced by 15% mid-year, resulting in reduced hours of operation for tutoring centers and skills labs (J. Boyle, personal communication, August 27, 2003). Additionally, when grants that support specialized programs such as learning communities or supplemental instruction end, or if the funding is cut by the sponsoring agency, colleges usually do not have enough general fund resources to continue the services at the same level, nor do they have the capacity to absorb the cost of the program within their annual state appropriation.

Clearly, budget reductions have a detrimental effect on community colleges' abilities to expand access and adequately support the learning needs of their students. Budget reductions affect access because community colleges are forced to engage in enrollment management practices that reduce student headcount in order to lower expenditures. As well, they often spur tuition and fee increases which also result in lost enrollment. Additionally, student support services often experience reductions during fiscal contraction, resulting in fewer students taking advantage of services proven to increase the likelihood of attaining educational goals.

Access and Transfer in California Community Colleges

The effects of fiscal contraction in California during the 1990s provide an excellent example of how reduced funding for community colleges diminishes access to all segments of California's higher education system. California, like other states across the nation, is experiencing a severe budget shortfall that is anticipated to last for several years. All segments of California's public higher education system are taking steps to mediate the anticipated declines in state appropriations. The University of California (UC), California State University (CSU), and community colleges will raise their tuition and fees significantly during 2003-2004. The UC and the CSU will both enact fee hikes of 30% over fall 2002 levels (Arnone, 2003), and the proposed tuition and fee increase for the community colleges will nearly double the fees per credit hour, taking the cost from $11 to $18 per unit (Maxwell & Mecoy, 2003). Additionally, in the face of booming enrollments, both the UC and CSU systems have suggested that some of their campuses will be limiting enrollment. California's community colleges have already started the process of decreasing enrollment, with many trimming their regularly scheduled offerings and eliminating appreciable portions of their summer and winter schedules.

Although the full impact of the current fiscal crisis in California will not be determined for several years, past experience suggests that the cost to students will be great. California's last severe budget crisis during the early 1990s left a substantial imprint on the state's ability to implement fully its 1960 Master Plan for Higher education, long viewed as a model for other public higher education systems. The effects of appropriation declines on access and transfer in California community colleges are worth reviewing because California is the largest community college system in the nation (Snyder, 2003), and its community colleges serve as the foundation of access in its public higher education system. The promises of access and transfer have made California's Master Plan for Higher Education a successful program for over 40 years. What follows is a summary of the impact of California's last severe fiscal crisis on access and transfer in its community colleges.

Access

The premise of California's Master Plan was to provide access to higher education for every Californian who desired it (Coons et al., 1960). The community colleges charged no tuition when it was enacted and helped to make this goal of access a reality, but they began charging a small fee in the early 1980s. The early 1990s was a period of further transformation in the fee structure for all segments of California higher education. Community college tuition and fees were impacted significantly by the state's budget shortfalls. Several changes to the fee structure significantly impacted community college enrollment in California (McCurdy, 1994). The changes, enacted in 1992-1993, included removal of the ten-unit limit on classes for which students were charged (previously students were charged for a maximum of ten units even if they were enrolled in more), increases in the per unit cost of instruction from $6 to $10, and a short-lived imposition of differential tuition for enrollees who already possessed a bachelor's degree. These changes were a significant departure from the 1960 Master Plan, which stipulated that attendance at community colleges would continue to be free.

A study by the Research and Analysis Unit of the California Community Colleges (1993) measured the impact of fee increases on enrollment in the community colleges by reporting both enrollment declines and estimates of unserved students, the difference between the enrollment demand estimate assuming colleges received adequate state funding, and the estimate for actual future enrollment. The enrollment decline in 1992-1993 was nearly 2%, equal to 23,300 students, and the estimate of unserved students was 98,000. In 1993-1994, the first year after the major tuition changes took effect, the system recorded an almost 9% decline in enrollment, or 132,300 students, and the estimate of unserved students grew to 140,000.

McCurdy (1994) also notes the considerable consequences of fee increases and the discontinuance of the fee cap. Approximately 41% of the enrollment lost during 1993-1994--54,000 students--already held bachelor's degrees. While state legislators believed these students to be "personal interest" enrollees, approximately 25,000 of them were enrolled in vocational training programs. Fee increases for students without bachelor's degrees were particularly difficult for self-supporting students, many of whom were low-income and minority students. Throughout 1992-1993 and 1993-1994, community colleges recorded disproportionate declines in the percentage of minority enrollees (McCurdy, 1994). Additionally, the lifting of the fee cap reversed a trend toward a greater percentage of students enrolling full-time, a factor associated with increased persistence. Although less is reported about the declines in scheduled offerings, it seems clear that the tuition and fee increases of the early 1990s restricted access and progress appreciably for California community college students, particularly for those students with low incomes and minority status. The 1993-1994 estimated enrollment loss of 132,300 students, combined with approximately 140,000 underserved students, underscores the significant impact of tuition and fee increases on college enrollment in California.

Transfer

The enrollment declines experienced in the early 1990s contributed, at least in part, to a decline in the number of community college transfers to both the University of California (UC) and the California State University (CSU) system. Examinations of reports from the California Postsecondary Education Commission (1994; 1997; 2000) reveal the pattern of transfer during the 1990s. Between 1991-1992 and 1995-1996 transfers to both the UC and CSU bad been increasing, with the UC hitting its peak of 10,475 transfers in 1994-1995, and the CSU peaking at 41,144 transfers in 1995-1996. However, between 1995-1996 and 1998-1999, approximately 4 years after community colleges first began experiencing enrollment declines, the community colleges recorded a steady decline in the number of students transferring to both systems. In 1995-1996, the California community colleges transferred 9,991 students to the University of California; by 1998-1999 the number of transfers had declined by over 14%. Transfer to the CSU system reflects a similar pattern. The 1995-1996 high of 41,144 transfers had declined by nearly 10% in 1998-1999. African American students were particularly impacted during this period, suffering transfer declines of almost 41% for UC and approximately 26% for CSU. The enrollment and transfer data suggest that enrollment declines in the community colleges, brought about in part because of tuition and fee increases, played a role in the decline in the number of transfer students to UC and CSU. It is likely that the decline in transfers is related to several factors, including a booming economy that resulted in more students joining the workforce rather than continuing their education. However, there can be no doubt that diminished enrollment in the community colleges reduced the transfer student pipeline.

Conclusion

It seems apparent that the definition of access in community colleges is a function of available resources. During times of financial crises, community colleges remain committed to the idea of universal access. However, in practice, they are unable to pursue such an expansive definition, particularly when there is a need to bring enrollment in line with available revenues. Financial contraction does not cause colleges to change their admission standards, nor does it cause them to change their requirements for enrollment; thus universal access is still technically provided. However, revenue shortfalls result in reduced access to the community colleges because they raise the cost of instruction and force limits on the supply of course offerings. Reducing the availability of courses makes it harder for students to progress through their coursework and achieve their educational goals in a timely manner. Thus, students with greater financial resources and flexibility in scheduling are better able to compete for educational opportunities during times of scarcity.

Price increases also create barriers for economically disadvantaged students. In addition to being priced out of enrollment, these students may attempt fewer courses because the financial threshold has become too high. Studies by both Kane (1995) and Halstead (1996) suggest that the affordability of a public two-year education is an important measure of the accessibility of higher education in general. When economics becomes a barrier to the constituents of the community college, fewer people are able to access and benefit from the entire system of public higher education. As tuition and fees increase, efforts should be made to expand awareness and encourage enrollment in financial aid programs, particularly among disadvantaged students.

Given community colleges' historic mission to expand access, academic support programs and services are necessary. With greater numbers of nontraditional, first-generation, and underprepared students attending community colleges, the need and demand for programs and services that support retention and academic success will continue to increase. Yet there is some evidence that existing student support resources are already inadequate for the task (Grubb, 2001). Because state appropriations have not met the demand in the student support arena, these programs are increasingly funded by alternate, temporary sources of funding such as grants and special categorical state augmentations, both of which are particularly vulnerable during economic recession. The result is unstable funding for programs intended to facilitate positive outcomes for some of the system's most vulnerable students. For these students, budget reductions result in attenuated services that diminish the prospects of achieving educational goals. Loss of funding for student support services not only limits student success but also restricts the ability of community colleges to facilitate goal attainment. Further research on the sources of funding for academic support programs and adequate levels of support for counseling and other programs is necessary.

California's experience during its last fiscal crisis underscores the need to preserve access in the community colleges. Evidence from California suggests that when access is reduced, the transfer mission of community colleges is threatened. Although it is likely that several factors, including the policies and practices of receiving institutions contributed to the declines in the number of transfer students in California, it also is likely that community college enrollment declines played a role in diminishing the transfer pipeline. Enrollment and transfer trends in California community colleges throughout the decade of the 1990s illustrate the impact of reduced financial resources on the ability of colleges to provide universal access and facilitate attainment of educational goals through student support services.

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Caroline Q. Sheldon is the Director of Research and Planning at Cerritos College in Norwalk, CA. [e-mail]