Stanley Berard

Lock Haven

In the several weeks since it was announced, I have been trying to understand the decision to close the Clearfield campus of Commonwealth University, but I still cannot explain it.

In announcing the decision to the CU community, President Bashar Hanna highlighted that in the last five years at Clearfield “the average annual operating deficit has been more than $1.6M.”

As shared with the CU community, this average deficit figure is based on average total revenues (tuition, fees and state appropriation) of $2.86 million and average “total expenditures” of $4.5 million.

“Total expenditures” includes employee compensation, financial aid, utilities and supplies and services. It includes one more item, an estimate of indirect expenditures — the share of the university’s general expenses like the registration, financial aid and central administration — attributable to Clearfield operations.

The estimate of indirect costs is computed as a cost per student credit hour. In the administration’s analysis, indirect costs of Clearfield operations averaged $1.8 million annually over the last five years. The total of the direct expense items averaged $2.68 million. Notice that the indirect costs are about 40% of the “total expenditures.”

I see no evidence that closing the Clearfield campus will appreciably reduce any indirect costs. We will not reduce general expenses by $1.8 million by closing the campus. The likely impact is much closer to zero than to $1.8 million.

If we exclude these indirect costs from the analysis, the last five years of operations at Clearfield brought an average of $2.86 million in revenue versus $2.68 million in direct spending–an annual average of $181,000 in net marginal revenue.

This does not make it a profit center, but it is a far cry from the implication that Clearfield operations bleed CU of $1.6 million a year.

Dr. Hanna’s announcement assured us that the Clearfield closure is based on a careful analysis. I have not seen such an analysis presented to the CU community.