28 Eastern Gateway Employees Will Lose Jobs as Part of Plan
YOUNGSTOWN, Ohio – Twenty-eight Eastern Gateway Community College employees will lose their jobs as part of the financial recovery plan for the college.
The reduction in force includes 10 hourly support employees and 18 salaried staff. Those affected have already been notified, and a college spokesman said there are no plans for additional staff reductions.
College trustees at a meeting Wednesday approved a reduction in force resolution, as well as a financial recovery plan and other resolutions that were required after the state Controlling Board approved a $6 million advance from the Ohio Department of Higher Education.
Interim President John Crooks said “the number of employees must be adjusted to financially operate a 9,000 student population.”
But Jim Corrin, president of the college faculty union, questions if the personnel cuts are in the right places.
“I don’t know of any administrators who have been let go,” he said.
He pointed to the college hiring consultants to help Eastern Gateway rectify its financial and operational challenges.
“Why do we still have executive vice presidents making over $100,000?” Corrin said.
The recovery plan says the college has reduced its operating expenditures and is improving its Pell Grant submissions.
Additionally, trustees Wednesday approved a resolution that requires expenditures of $50,000 or more to be included in the college operational budget. And another resolution requires trustee approval for purchases of $50,000 or more.
The Controlling Board approved the advance in state share of instruction funds in December 2023 to ensure adequate cash flow for the college. It amounts to a three-month advance. It followed a nearly $4 million advance approved by the Controlling Board in August 2023.
As part of that advance, the college had to follow a list of requirements, including adopting a financial recovery plan that includes an analysis of the financial difficulty and the causes of revenue and expenditure problems, description of efforts proposed to address those difficulties and analysis of how those efforts will resolve the financial difficulties.
Another requirement was the immediate review and elimination of all nonessential expenses.
College representatives will return to the Controlling Board and report progress in March.
The latest staff cuts follow the college’s trimming of about $4 million in costs, with about 60% in personnel costs and the rest in operational expenses. Most of the personnel cuts came from the Eastern Gateway adjunct faculty pool.
About 50 full-time staff members previously were reduced, with roughly 20 laid off and the remaining leaving for other employment.
Also among the requirements to secure the advance, by March 1, a “determination shall be made regarding opening for the summer/fall semesters, based on the anticipated financial viability of the institution in the long term.”
The college has been embroiled in financial problems and issues with its accreditation for more than a year.
Some of them stem from the college’s free tuition program, which enabled enrollment to balloon from about 5,000 in 2017 to close to 45,000 at its height.
The U.S. Department of Education in July 2022 ordered Eastern Gateway to cease and desist its Free College Benefit program and stopped Pell grant funds for new students. The department alleged that Pell Grant recipients were charged more than those who didn’t receive the grants.
Eastern Gateway sued the department, asking the court to stop enforcement of the order, saying it threatened the college’s ability to continue operations. Pell Grant funds amounted to nearly 75% of Eastern Gateway’s overall revenue at the time.
The parties settled the suit in August 2023 and the free tuition program ended, but the federal department is expected to levy a fine against the college.
Eastern Gateway expects about 9,000 students to be enrolled for spring 2024.
The U.S. Department of Education placed Eastern Gateway on Heightened Cash Monitoring 2 status in August 2022, meaning the college must use its own resources to credit student accounts and then wait for federal student aid reimbursements from the U.S. Department of Education.
In November 2021, the Higher Learning Commission placed the college on probation, though it remains accredited.
The HLC extended probation in November 2023, citing in part its financial issues. The commission will visit Eastern Gateway this spring, and its board is expected to decide on the college’s probationary status in November 2024.
Copyright 2024 The Business Journal, Youngstown, Ohio.