The checkbook scramble begins.
Gila Community College pays Eastern Arizona College four times each year for providing educational services.
A bill arrived from EAC for $1.6 million dollars. GCC only had $1.5 million in its account.
“We don’t have the funds to pay the invoice,” board chairman Bob Ashford told members of the governing board last week.
Ashford said EAC will likely allow the college to delay payments until it has the money.
As GCC scrambles to raise revenue and cut expenses, heightened attention has focused on EAC and the agreement between the two schools.
Last week, the board approved asking voters in a March election for an extra $1.2 million in property taxes. Ashford said the college has the lowest property tax rate in the state at roughly 53 cents per $100,000 of assessed valuation. The new, secondary tax would cost owners 25 cents per $100,000.
Ashford said the extra money could end a four-day each month furlough for administrative employees and erase the deficit. If voters defeat the measure in March, he wants to ask again in November. Exact figures remain unclear, but the deficit at one point reached $2 million, according to college officials.
Hopefully, the college will be able to convince voters, Ashford said, adding that residents look to education in tough economic times for new skills.
Board member Larry Stephenson disagreed with Ashford. “I am troubled by your comment, chairman. You said we’ll put it on the ballot again and again and again.”
He continued, “I feel bad that we’re split.” However, he said he couldn’t support an increase until the college gains clarity with its finances.
“Larry, I don’t know that you’ve ever been united with this board,” Ashford told him.
If GCC board members wanted to examine EAC’s financial records to verify charges, the contract between them provides them that ability once annually. The agreement gives EAC 30 days to respond to GCC’s written request.
This year, 97 percent of GCC’s $6.17 million budget will go to EAC, which pays the bills.
A closer look at the contract also casts doubt on whether GCC had the authority to raise its tuition 30 percent. In August, at least one board member touted the decision as a difficult but important step in independently creating the college’s destiny.
However, that independence may have been a façade. A clause in the contract provides EAC with sole discretion over setting tuition for GCC, and states that EAC’s tuition applies in Gila County.
EAC backed GCC’s 30 percent increase, but reportedly pushed for 40 percent.
EAC also decided on the furlough that saved $526,000. The decision did not need GCC board approval.
Gila County’s population counts and property valuations fall beneath legislatively-set thresholds, and so it cannot operate its own college.