By Teri Bernstein

Our analysis of the 50% law calculations for 96-97 and 97-98 uncovered serious problems in account classification. That may seem too technical to be interesting, but here is the problem in a nutshell.

   1. The 50% law exists because people and legislators do not want administrative expenses and other non-instructional expenses to be more that what is spent at community colleges to actually TEACH students.

   2. The law is set up with a lot of exclusions and gray areas so that there are many LEGAL ways to "stretch" compliance with the law.

   3. The fraction that needs to be at least 1/2 (or 50%) has instructional costs on top, and "education expenses" on the bottom.

   4. If the calculation is too low, one way it can be manipulated into being bigger is by increasing instructional expenses. This is done legally by increasing faculty salaries, hiring more full time instructors, paying part time faculty for office hours, improving Load factors, and various other ways, like by putting tutoring labs under the supervision of faculty. An illegal way to do is to intentionally misclassify costs like reassigned time and classified instructional aides. We told the District about their problem in reassigned time; we have not yet completed our analysis of the classified classification, but the problem also exists there.

   5. The District is in trouble because they are a) increasing administrative and classified salaries more than faculty salaries; b) increasing the percentage of sections taught by part-timers; c) spending over a million dollars more per year on contracted services; d) hiring more and more and more administrators.

   6. Another way the calculation can be manipulated is by making the bottom of the fraction smaller÷by excluding expenditures from what are "educational." It is OK to exclude new equipment, buildings, legitimate community service expenses, and self-supporting "ancillary" expenses like parking. Categorically funded items are excluded (the restricted budget). It is actually shocking to see what can be legitimately taken out÷like the whole $800,000 annual rent payment for Madison. This exclusion feature of the 50% law means that SMC is really not spending close to 50% of general fund÷SMC really spends less than 40%.

   7. SMC manipulates the bottom of this fraction, too. Police cannot be excluded from the calculation. Replacement equipment cannot be excluded. The "maintenance" portion of every lease agreement cannot be excluded. SMC is not allowed to exclude $1.5 million TWICE as they did in 96-97. There are other problems as well.

   8. Dr. Robertsonâs response to our revelations at the Board meeting was that SMC did not have to comply with the law until every community college in the state was held to the same standard. This is like telling your IRS auditor that you won't pay your tax bill until EVERYONE is audited. The reason unions in other Districts are not pressing their administrations to stay within the letter of the law is that other Districts are probably, to use another analogy, going 65mph in a 55 mph zone÷not 120 mph! Other Districts probably are more fair with the division of additional dollars than SMC. For example, other districts discuss the use of the Partnership for Excellence money with faculty instead of allocating it to new Administration and new Consultants.

   9. Comparing the 50% law to AB1725 is like comparing apples and oranges. The District argues that since reassigned time "counts" for the AB1725 calculation, it should count for the 50% law. The Chancellor's office of the State of California disagrees. The 1993 Budget and Accounting manual, which tells the Districts how to account for AB1725 shared governance costs like Faculty Senates, clearly and specifically defines these reassigned time expenses as NON instructional.

  10. The District's initial response to our discoveries--made and communicated to them OVER THE SUMMER, was to ignore us and hope we dropped the issue. They have refused to give us copies of basic information, possibly because they have more to hide. They did not even take the legitimate way out of their problem by filing an exemption with the State, which was the recommendation of financial administration here. Top administration made a decision to cover-up the problem with fancy accounting.

  11. The recent District response to our attempt to inspire them to "GET LEGAL" has been to "threaten" or "warn us÷in other words: TO INSPIRE FEAR. There is no reason that the District has to cut reassigned time, slash counseling budgets, or implement even screwier accounting practices. We met the 50% law guidelines with plenty of reassigned time and counseling expenses for DECADES. The problem now is the MASSIVE increase in Administration and Contracts and Services. (We still haven't figured out how they are funding all the overseas travel and fancy meals.)

  12. What we really don't understand is that, if they talked to us, we'd negotiate a plan that ensured a "fair share" for faculty of this spending extravaganza. We'd give them some leeway in handling their 50% problem, and the time to pursue a future law change if they think they have a case. They cannot change the law retroactively. They are out of compliance for 96/97 and 97/98 and they will be way out of compliance for 98/99 unless they implement some of the options discussed in #4 above. We informed them initially of their problem and have tried to talk to them about this since August. However, the level of contempt for faculty is so complete that this Administration would rather risk a legal decision that would require SMC to make millions of dollars in payments to faculty within one year or have to pay back money to the State and endure a PERMANENT decrease in District funding. Weâve appealed to the Board, but the Board either does not understand all the downside risks of the District's position, or shares top Administration's contempt for the law and for faculty. We know that Board members have been told they are "not allowed" to talk to us, but they are allowed. We are allowed to provide information, we are not allowed to bargain. We hope the Board, as well as the Administration, will start to listen.