City College’s “edifice complex” on display.

The tiresome story of colleges hiring adjunct professors to carry the burden of teaching is starting to come full circle. At the San Diego Community College District, cutting classes taught by adjuncts is the latest desperate strategy for healing management’s self-inflicted wounds. And tutors at City College may well have been the canary in the mine.

Many employees complain that under the top-down leadership of Chancellor Constance Carroll, serious problems — including fraud and embezzlement — lower down the command structure too often go unnoticed.

In 2009, Rob Bush began taking classes in audio editing and production in the Radio, Television and Film department at City. He found that the editing did not come easy, so he put in long hours working by himself in the studio until he mastered techniques that he characterizes as largely “tactile.” By 2011, the year he finished the program, he had become so competent that he was asked to join a small team of tutors who helped beginning students. “Eventually there were 12 students who passed their classes because of me,” says Bush.

Ricky Shabazz is one of four district presidents since 2013.

The rate of pay was $11.25 per hour, and Bush was putting in 25 hours per week. But over time, Dean of Arts and Humanities Trudy Gerald began, with no advance notice, to reduce his and the other tutors’ hours, first to 16 hours, then halving them to 8, and finally to 4.

“I could see the students needed me,” says Bush, “so I worked five to six extra hours per week without pay. I love the audio program at City. It has helped many people find jobs, probably training 90 percent of the people who work in the field locally.”

Deficits balooned under vice chancellor Bonnie Anne Dowd.

The treatment of the tutors was “indicative,” Bush tells me, of disrespect for those in the lower echelons. “Why didn’t they just lay me off?” he asks.

One day in May 2018, several human resources personnel, accompanied by a campus police officer, removed Dean Gerald from her office and walked her off the premises. The reason could hardly have been how she treated tutors. Nor is it likely due to the Radio, Television and Film department complaining two years earlier that she dragged her feet in removing its increasingly erratic chief engineer. (He was eventually arrested for theft of expensive sound and video equipment).

At first, total silence surrounded Gerald’s removal, leading everyone to conclude that the community college district had paid for it. Several persons speaking anonymously, persons who would have been in positions to know at the time, have told me that Gerald was not fired but allowed to resign with full pension. Nothing more is known conclusively of the incident.

Mismanagement is endemic throughout the district. It might be argued that turnover at the top of the chain of command at City College is the source of its problems. Since President Terrence Burgess retired in 2013 after 12 years at the helm, there have been two new presidents (Anthony Beebe and the current Ricky Shabazz) and two interim presidents (Lynn Neault and Denise Whisenhunt).

Current district chancellor Constance Carroll replaced Augie Gallego in 2004. Many employees complain that, under Carroll, the district has used such a strictly top-down management style that it often misses problems lower down, such as fraud and outright embezzlement. According to highly placed sources, within the last decade one embezzlement scheme went on for five years at losses to the district totaling $132,000 per year. Normally, an organization’s internal auditor detects wildcat expenditures, but under “Internal Auditor” on its website, the district lists “vacant.” It has been vacant for nearly ten years.

The district hired an outside firm, as required by the state, to do its yearly audits.. From fiscal year 2013-2014 through 2016-2017, San Diego-based Christy White Associates performed the audits. In each year, the company found “significant deficiencies in internal controls” in the district’s financial operations. In 2017-2018, Christy White was replaced by CliftonLarsonAllen, which found the same deficiencies.

It is possible that, despite audits, the district’s management can conceal fraud or embezzlement, because auditors often only ask management if they are aware of any fraud or misappropriation of funds. As evidence of the inherent risk of such an approach, consider the case of Dixon, Illinois. Over 20 years, the city’s treasurer, Rita Crundwell, successfully embezzled enough to buy an extravagant horse ranch without a longtime outside auditor realizing it. “The lesson painfully learned by Dixon,” wrote Kelly Pope in the July 31,2013, edition of Forensic and Valuation Insider, “was that trust without verification is a recipe for disaster.” The title of Pope’s article was “The $54 Million Fraud: What CPAs can learn from the fleecing of Dixon, Ill.”

The accounting firm that was hoodwinked for so long, Clifton Gunderson LLP, merged with LarsonAllen in 2012, creating CliftonLarsonAllen. San Diego Community College District’s outside auditor: CliftonLarsonAllen.

The San Diego district’s finances have shown a precipitous drop, ending in June 2019 in a disturbing deficit that lingers. A better place than the audits to see the district’s financial health are the reports it makes to the state. These can only be obtained by a California public records request. But colleges will suffer state funding sanctions if the reports are substantially false.

Under the supervision of executive vice chancellor for technology and business services Bonnie Anne Dowd, the main factors leading to the deficit were twofold. First, the district started running too many classes given the funds being received from the state. Second was the significant PeopleSoft internet technology consulting costs that were so over budget that they’ve had to be charged to the operating fund. The PeopleSoft project had been supported by bond funds. But Prop S monies, the specific source of funding for the project, as well as recent building projects, has run out of money. The proposition, along with Prop N, also bore much of the burden of funding the district’s tremendous edifice complex — 36 new buildings and 18 building renovations.

At the end of the 2016-2017 fiscal year, the district’s General Fund Unrestricted beginning balance from the end of the previous year was $34,906,804. Its closing balance was $25,388,757, the figure that became the beginning balance for 2017-2018. The closing balance for that year was $6,565,629. The closing balance for 2019-2019 would have been a negative $20,257,898 except that the district had raided several other funds to the tune of $37,582,139. One of those funds was Other Post-Employment Benefits, withdrawing $14,700,000. An additional $22,182,139 was made available from a General Fund Unrestricted account, meaning the funds supposedly were restricted to be a reserve account.

The ending balance in 2018 - 2019 for the district’s general fund unrestricted was $17.3 million. However, that was after the transfer in of the $37.6 million. If the district continues its current spending pattern, the financial balance could be in a deficit for FY 2019 - 2020 with no means to cover it. Recent revelations have shown the difficulty the City of San Diego still has in paying money back that it borrowed from its pension system in the early 2000s. The 2009 recession made the problem much worse. If another downturn in the economy should take place, the San Diego Community College District will be in an especially precarious situation. If the faculty members who were not paid on time one month several years ago thought that was bad, they might want to think about the district’s financial health today.

District chancellor Constance Carrol indicated in a July 2019 email to faculty and staff that reducing classes that adjunct instructors teach will be the road to recovery. In fact, now that would be about the only way out.