ECC Responds to Critical Audit with Corrective Action Plan

By Tony Farina

Erie Community College has filed a formal response to the Jan. 14 audit report by the state comptroller that detailed a “lax control environment” established by the board of trustees that allowed college management to assume board responsibilities and make key financial decisions with little or no board oversight.

The audit’s objective, according to the state comptroller, “was to assess Board oversight and management of College resources for the period Sept. 1, 2013 through July 2, 2015,” and the final report gave ECC a failing grade and made 22 recommendations and a written corrective action plan was requested from college officials within 90 days, meaning the due date was Tuesday, April 14.

A special meeting of the Board of Trustees on Tuesday unanimously approved a corrective action plan that addresses each of the recommendations contained in the audit of State Comptroller Tom DiNapoli, and now the challenge will be for the board to find a way to implement all of the changes it has submitted in that response.

Among the highlights:

• While the hiring of senior staff is within the purview of the president, any significant financial decisions regarding senior executive staff, including the creation of new positions, should be and will be approved by the board and recorded in the minutes.

• In the case of the creation of new positions, such action should and will be initiated by the submission of an employee hiring justification form by the president of the college to the board of trustees.

Among the findings in that blistering state audit report was that ECC President Jack Quinn created positions and handed out pay raises and other financial benefits to senior staff and certain employees without prior approval of the board.  The corrective action plan, submitted by the audit review panel under Chairman Dennis Murphy, would block Quinn or any future president from taking such action without board approval.

Other corrective action steps submitted in the report include:

• The board of trustees will authorize each senior executive staff position and compensation change.  Annually, the board will receive details concerning each itemized position through the college’s budget process.  Modifications to the approved budget would need board approval and need to be recorded in the minutes; and

• College management has completed steps to recover any ECC funds determined as improperly made to former employees.

In all, the audit review panel responded to each and every one of the 22 recommendations contained in the state audit, and as officials confide, the challenge will now be to make sure the corrective action plan is implemented as completely as possible.

In his cover letter to the board, Chairman Murphy, who is also a trustee, said the review panel considers the comptroller’s findings “as an opportunity to enhance top-down business methods through best practice and policies and procedure, responding appropriately where it did not find agreement,” adding he hopes the panel’s submission will be received with “specific satisfaction” by the comptroller.

Brian Butry, a spokesman for Comptroller DiNapoli, said the comptroller’s office will review the corrective action plan submitted Tuesday and “work with the college” where possible.

Erie Community College is facing serious financial challenges even as it seeks to show it is responding positively to the highly critical state audit that took 13 months to complete.  As we reported last month, declining enrollment, the depletion of reserve funds, and quite possibly the poor management of college resources will likely lead to another tuition hike for students of between $250 and $300, the third straight tuition hike at the three-campus college.

It is also true that both state and county funding for ECC falls short of the state formula for community colleges, another of the challenges facing the institution that is viewed as a valuable contributor to local workforce development when operating at full capacity.  Unfortunately, ECC’s enrollment has fallen significantly over the last three years yet staff and security costs continue to increase, a curious occurrence that would seem to clearly support the state audit findings of lax controls at the management level.  In other words, the staff has gotten bigger even as the student population has declined.