As the coronavirus pandemic wears on, State Center Community College District is beginning to get a better look at where its finances are after anticipating drastic cuts to funding just two months ago.

Early in May, State Center predicted a $36 million budget loss as the state grappled with its own $54.3 billion deficit due to COVID-19.

In June, trustees passed a tentative budget that forecast a 10% reduction in funding, with an overall loss to the California Community College system of $1.5 billion.

But at Tuesday’s board meeting, a week after Gov. Gavin Newsom signed a new budget, a slightly rosier version of the college’s finances was presented by Cheryl Sullivan vice-chancellor of finance and administration.

“The 2021 budget is pretty much last year’s budget, except there’s no (cost-of-living adjustment),” Sullivan said. There are no program cuts like previously thought.

Although community colleges were spared cuts in the state budget, $470 million was cut from the University of California and $500 million for the California State University system. Universities and community colleges are hoping federal help will come in October, which will ease deferrals for community colleges, and cuts for universities.

State Center trustees are expected to vote on a final budget in September.

The biggest problem, Sullivan said, is massive deferrals from the state that will require State Center to increase its reserves or borrow money to keep its day-to-day services running.

If federal funds don’t show up in a worst-case scenario, the district will have to spend $15.6 million from reserve funds.

“Fortunately, if we’re successful, we have enough reserves that we will not have to borrow money to make payroll and keep these colleges running,” said Chancellor Paul Parnell.

Colleges will get the money back in phases and how much will depend on whether California gets the federal relief money. With the funds, the deferrals will stand at $28.1 million, or 14% of State Center’s budget. Without federal funds, it shoots up to 30%, or $62 million. The district won’t fully be refunded until November 2021, Sullivan said.

Another problem is enrollment growth. Parnell said summer school has seen large numbers of students turn out, but fall isn’t looking as good.

Reedley College this summer saw a 6.2% jump in enrollment from summer 2019.

“Enrollment is 70% of the formula for how we’re funded,” Sullivan said, making low turnout a problem.

Officials predicted community colleges might get a boost in enrollment just a few months ago, as traditionally it rises with unemployment.

“Every single college president is out there trying to get in touch with the students and see if they’re just waiting to see if we have online or in-person classes,” Sullivan said. “And that seems to be the biggest thought, is that they’re just waiting to see what’s going to happen.”

But even if the district makes it through the year unscathed, Sullivan is already anticipating 2022.

“The biggest concern is economic recovery and how will California and Fresno, Madera, Kings, Tulare (counties) actually recover,” she said.

“And then for 2022, we know that we’re using a lot of the state reserves this year. So that’s another concern we’re going to have next year is that they’re not going to have that backfill to help soften that blow.”

The Education Lab is a local journalism initiative that highlights education issues critical to the advancement of the San Joaquin Valley. It is funded by donors. Learn about The Bee’s Education Lab on our website.