MCC sees signs of improvement in latest audit

Mesalands Community College received an unmodified opinion — the best attainable — in its recently completed audit for fiscal-year 2023.

Though the audit’s number of findings edged up from nine to 10 in the 2023 audit, its unmodified (or “clean”) opinion signaled a marked improvement from the disclaimer, or second-worst, opinion from the college’s FY2022 audit. It was a sign Mesalands is emerging from its fiscal crisis that came to light early last year.

During the Nov. 19 board of trustees meeting, board Chairman Richard Primrose said he’d attended an exit conference about the FY2023 audit with State Auditor Joseph Maestas.

“He said we’ve come a long way, and the stormy water is clearing,” Primrose said. “We are definitely moving forward.”

During the meeting, the board went over the FY2023 audit by teleconference with Donna Trujillo, director of the financial audit division of the Office of the State Auditor. Trujillo also presided over the college’s 2022 audit.

The audit states in the fiscal year ending June 30, 2023, the college experienced an operating loss of $7.33 million. The college’s cash on hand declined from $2.09 million to $575,000 by the end of the fiscal year. Its net position, however, improved from $9.32 million to nearly $11 million.

The audit reported material weaknesses in the college’s financial close and reporting, its bank reconciliations and missing documents in adjusting journal entries — all citing extensive turnover in the financial office.

It found a significant deficiency in budget overruns for instruction and general budget by $745,541. It cited “a lack of effective budgetary control and financial management.”

It stated “it appeared Dr. (Gregory) Busch, who was the president at the time, approved salary increases for the staff that may not have been supported by the approved budget.”

The college, reportedly weeks away from not meeting payroll, in early 2023 imposed extensive cost-cutting measures.

Busch left town and eventually resigned after no-confidence votes by the staff senate, faculty senate and executive team.

Another significant deficiency was found in disbursements and travel reimbursements due to lack of timely submissions or documentation.

The report also cited a lack of endowment documentation, late submission of data collection to the federal audit clearinghouse, late deposits, undercollateralization of funds and late audit submissions.

While noting seven the findings were repeated from the previous fiscal audit, Trujillo said Mesalands was “getting better” in addressing them.

Trujillo also commented about “amazing improvements” by the college and good work by its staff.

After Trujillo’s overview of the audit, the board unanimously approved it.

Trujillo said she next would complete the FY2024 audit and anticipated it would be finished by February or March.

Rachelle Arias, director of the college’s office of business services, told the board the repeated findings probably won’t be gone until the FY2025 audit.

The college soon will begin a special audit, also performed by the state auditor’s office.

Shawn Beck, Office of State Auditor special investigations director who attended the board meeting, said he was looking forward to “a smooth process” in completing that audit.

During his written president’s report to the board, Allen Moss stated the main purpose of the special audit “is to determine how Mesalands got into the mess it did and what could be done to prevent a future occurrence.”

In other business:

— Josh McVey, vice president of student affairs, presented a more detailed strategic enrollment management plan.

While Mesalands saw enrollment decline 39% during the previous five years, McVey said other higher-learning institutions saw drops of 50% or more.

This year, MCC’s enrollment rose 14%.

“We are pulling out of our decline,” McVey said, adding the college is using a recruiter again for the first time in four years.

The report projects Mesalands’ enrollment will rise from 545 in fall 2024 to 612 by fall 2028.

He said Mesalands is well-positioned to prepare students for two of the fastest-growing jobs in the U.S. — wind technician and healthcare.

— McVey said Leeward Renewable Energy, which operates wind farms in southern Quay County, has offered scholarships for the college’s wind program and opportunities for its wind technicians to lead workshops.

— McVey reported a team for an upcoming “Powershift” documentary film followed around two Mesalands wind-technician students.

— Moss said he was notified by the Higher Education Department it would recommend funding for the nursing and wind programs to the state legislature. He noted Mesalands is the only college that operates a nursing program without state funds.

Moss said the college also would submit a special funding request to help defray costs of the nursing program.

— Moss said the college recently moved its bookstore into Building A, and the business office is being moved into the former library space.

— Mark Martinez, executive director of operations and procurement, said he hopes to have contractors replace the roof on Building A during the winter break to minimize disruptions to students and staff.

He also reported HVAC units have been replaced in Building A and former armory. New LED lighting also is being installed in phases in Building A.

— Martinez said a new circuitry board for the wind turbine didn’t not resolve its problems. He said officials are troubleshooting the issue.

— Martinez said the fitness center again will offer a promotion of a free sixth month if residents buy a January-through-May membership.

— Jessica Gonzales gave her annual financial aid report. A total of 265 students are receiving a total of $912,416 in aid during the current school year, though both numbers are expected to rise. Over half of that money is from federal sources.

— Joel Kiser, vice president of academics, said the college would hold its Honors College presentation on Dec. 3 and a pinning ceremony for the nursing program on Dec. 7.

— Kiser said 200 users and nursing students would have first access to the new Canvas learning management system.

— McVey showed newly designed vests for the rodeo team.