These are strategies that must be followed no matter what the immediate financial situation of the college.  Principle:  We must always keep clear focus on the continuing financial picture and do nothing to damage the long-term viability of the college or the collegeís ability to accomplish its comprehensive mission.

1. Maintain physical plant and capital equipment in good repair with adequate budget allocations.  Postponing maintenance and repair only increases future obligations to maintain the publicís investment in the collegeís physical assets.
2. Maintain a long-term employee compensation strategy that balances the need to attract and retain highly qualified employees with the economic and political realities of the local and state environment.  Develop and maintain a strategy to assess and provide for anticipated future costs of compensation.  This is a collective bargaining issue and decisions about compensation must be made ultimately by the Board of Education.
3. Fund ahead for known future obligations (e.g., early retirement programs, compensation studies, etc.).  If we delay funding future obligations or ìborrowî money from resources set aside for future obligations we only create a larger liability in the future.
4. When allocating money for a new program, service or capital investment, take into account the FULL cost of that program/service/investment.  ìHiddenî costs should be uncovered and analyzed before making any new large expenditure.
5. Donít spend strategic (non-recurring) funds on continuing (recurring) needs.  Spending one-time money on continuing needs creates a future obligation with no means in place to pay for that obligation.  Non-recurring funds should either be set aside for specific projects or invested in capital needs.
6. Budget for annual unanticipated needs (Board and administrative contingencies). Every organization has needs that emerge after the annual budget is adopted.  It is unrealistic to expect that every need can be anticipated 18 months in advance.  Sound fiscal practice calls for allocating reasonable and sufficient contingency to meet these needs.

These strategies are necessary for the college to remain competitive and to give students the best programs and services possible.  Both this category of strategies and the next call for maximizing current investments.

1. Focus budget reallocations and new allocations on accomplishing selected Strategic Plan goals.  The Strategic Plan has been carefully developed to identify where the college should best focus its efforts to accomplish its mission.  Resources should be allocated strategically and therefore in keeping with the plan.
2. Maintain adequate Materials and Services budgets that take into account the effects of inflation. Not increasing Materials & Services budgets has the same effect as across-the-board reductions: the quality of instruction and services is put at risk.
3. Budget for replacement of capital equipment.  A planned capital equipment replacement schedule is necessary, especially in instructional areas dependent on training students to use up-to-date equipment.
4. Treat computer hardware/software replacement as a Materials & Services budget item.  Since the life cycle for computer hardware and software is very short (about 3 to 4 years) and technology is integral to instruction and operations, replacement cannot be treated like other capital items.
5. Invest in student success/retention.  A large number of college cost analyses show that it costs less to retain current students than to attract new students.  This strategy does not necessarily dictate spending more money overall on success/retention but rather examining how funds for student success and retention are allocated now. 
6. Invest in instructional technology to maximize access.  Distance learning through technology will provide a wider market for the college and the possibility of higher enrollments.
7. Develop a plan and budget toward maintaining a diverse base of full-time faculty.  [Note: need to clarify this strategy.]

Strategies for maximizing revenue must focus on making the most of the investments we already have both in people and in physical resources.  Principle: use current capacity to maximize enrollment and access.

1. Increase utilization of physical capacity. The physical plant costs money even when empty and therefore we should use the facilities as much as possible. Evening and weekend programs and classes increase the utilization of facilities. Our summer resources, including facilities and staff, are especially underutilized. 
2. Use available Salary Reserve funds to cover instructor costs for extra sections. Budget left in the Salary Reserve account can be used in the current year to increase enrollment capacity thus increasing state funds for the upcoming year.
3. Use effective targeted marketing.  Under-enrolled programs and classes should be identified, evaluated and, if viable, marketed aggressively.  The college should identify through appropriate research programs and services that will meet the needs of district residents.  The effectiveness of marketing projects should be evaluated.
4. Count all possible FTE.  Put systems in place to ensure that the college is reporting all allowable FTE for state reimbursement.
5. Maximize indirect charged to grants.  Most grants allow applicants to include the costs of administering grant activities (e.g., facilities costs, counseling for special populations, cost of business services, etc). Our ìnegotiated rateî with the federal government for administrative recovery on grants is approximately 50%.  Lane typically collects around 2% to 4% overall for administrative recovery.  This makes most grants a net financial loss to the college.  We should establish a clear policy that requires grants to cover the full costs of the program with the administrative recovery kept as unrestricted funds.
6. Develop a three-year plan for tuition rates.  A multi-year tuition rate plan allows for better fiscal planning for the college and for students.  The plan could be as simple as tying tuition increases to increases in the local area median family income.
7. Investigate new revenue sources.  Currently, the only major revenue source under the control of the college is tuition & fees.  Lane should explore new revenue sources that might bring in significant funds to the college.  Decisions in this area would need to be balanced with the costs of developing new revenue sources.

These strategies should be ongoing.  Note that sometimes a one-time investment can be made to reduce costs in the long term.

1. Invest in technology to increase the cost efficiency of operational processes.  Up-to-date technology (hardware and software) allows staff to be more productive.  Old out-of-date technology hinders efficiency, creates unnecessary costs, and is detrimental to serving students.
2. Increase efficiency of operational processes.  Time and money invested in continuous improvement and/or redesign of whole processes results in more cost effective operations.
3. Use NWC-Restricted (department carryover) to fund department needs before allocating additional General Fund budget monies.  Because departments are allowed to manage their costs over longer time periods through carryover, they should be given more responsibility for balancing new needs with old and for meeting unanticipated needs.
4. Periodically review discretionary expenditures (e.g., travel, consulting services) to determine the need for and effectiveness of these costs.  All expenditures should be reviewed regularly as a normal part of the budgeting process.

These program/service strategies should be ongoing no matter what the financial condition of the college.

1. Regularly ìpruneî programs according to established criteria (e.g., low demand, high cost, lead to jobs that are low-paying, etc.).  It is good management practice in any business or organization is to continually examine products or activities and weed out those that are not contributing as much to meeting customer needs or accomplishing the strategic purposes of the organization.
2. Regularly ìpruneî services according to established criteria (e.g., low impact, fewer numbers of people affected, etc.).  Likewise, services that support the main mission of the organization should be regularly examined and eliminated as they become less value-added.
3. Donít make across-the-board reductions; instead look at whole functions.  Percentage reductions in all programs and services merely erode the quality of every program/service and jeopardize the effectiveness of our human resources by stretching employees beyond reasonable limits. The challenge of this strategy is finding whole functions to reduce substantially or eliminate.

These proposed strategies fall into two categories: (a) those that will help ìbufferî the college from large reductions and phase in longer term budget reductions; and (b) those that could be long-term.  Any short-term benefit must be weighed against the long-term effects of each of these strategies.

A.  ìBuffersî

1. Freeze or reduce employee compensation.  Since payroll is 80% of our annual expenditures, clearly this could have a significant impact on our budget.  However, (a) such changes would have to be negotiated with the unions, (b) experience shows that freezing or reducing compensation creates a future obligation to provide a ìcatch upî for employees, and (c) our ability to attract and retain good employees would be affected.
2. Eliminate/curtail/suspend selected services.  Employee layoffs in selected service areas could have a significant impact on the budget.  This would have to be weighed against potential impacts on (a) student enrollment and retention, (b) the physical learning and working environment, (c) the safety of students and employees, (d) the smooth day-to-day operations of the college, and (e) the stress levels experienced by employees in trying to maintain high quality services.
3. Redirect money held for specific projects or long term obligations. This includes Restricted Net Working Capital being held for department needs through their carryover.  While this would be a ready source for reallocation, using money set aside for specific purposes could severely jeopardize the long-term financial health of the college (e.g., #1, #3 and #5 under ìLong-term financial strategiesî).
4. Shut down college operations during breaks.  The collegeís physical capacity is severely underutilized during breaks.  If new programs cannot be scheduled for these times, then the college should consider shutting down operations.  It would be necessary to bargain corresponding reductions in employee assignments for these time periods they would not be working.
5. Selectively reduce enrollment.  While FTE brings in state revenue some FTE can also be a net dollar loss to the college.  Savings can be realized in at least two ways: (a) by reducing the number of classes in programs that are being subsidized by other programs and (b) by reducing enrollment to a level that will reduce the need for support services and allow for reductions in those areas.  A planned reduction in enrollment need not be a ìbadî thing for the college.
6. Increase the efficiency in scheduling of classes.  Review class sizes and number of sections of a class and adjust in areas where efficiencies can be gained.  This approach could reduce direct instructional costs but also could affect the quality of instruction.

7. Examine policy for extending financial credit to students.  Currently, students are automatically extended credit for the cost of enrolling in classes.  While this policy clearly has increased access for students, it has also resulted in a very large bad debts expense each year.
8. Investigate contracting out some services.  Some college services might be provided by external organizations at a lower cost.  This would have to be weighed against the loss of control over quality.
9. Increase tuition rates.  Tuition is the only significant revenue that the college has control over.  Tuition increases need to be balanced against access and affordability for students.