Editorial: Peralta starting to dig out of deep financial hole

Past administrations and boards of the Peralta Community College District dug such a deep financial hole that it will take years to climb out.

Fortunately, despite the pandemic, district trustees are finally starting to recognize the depth of the problem, to stop digging the hole deeper and to begin the recovery. Voters should elect trustees who will continue that effort.

The best choices are incumbent Cindi Reiss in Area 5, who has been a leader of the refreshing change; Louis Quindlen in Area 3; and Seth Steward in Area 7.

Early this year, the Accrediting Commission for Community and Junior Colleges took the four Peralta campuses — Berkeley City College, the College of Alameda, Laney College and Merritt College — off probation in part because the district had started to address its budget shortfalls. But the challenges will persist: As student enrollment continues to decline, the district’s finances are being propped up in part by state subsidies that will run out in the next few years.

The district, meanwhile, has developed a plan to deal with the very costly and irresponsible bond borrowing scheme developed by leaders in 2005 to cover the cost of workers’ retirement health benefits.

The original deal was structured so that the bond payments were backloaded, resulting in ridiculously expensive interest costs. The resulting debt, $235 million as of four years ago, is more than was originally borrowed and will require decades of rising payments that will eat up education funds.

Under the new plan to try to reduce the financial pain, the district needs to consistently pay more up front toward retirement of the bonds so the installments in later years don’t become completely unmanageable. It’s a classic case of pay now or pay a lot more later.

Then there’s the leadership turnover. The current interim chancellor, Jannett Jackson, is the fifth top administrator in four years. In her 18 months on the job, she has made significant progress righting the district’s finances and flawed accounting systems. Jackson has committed to stay through December 2023; district trustees should plan for her departure with a nationwide search for her replacement.

This is important because the district must right its finances and stabilize its leadership to provide quality education.

Area 3 – Louis Quindlen

Area 3 incumbent Linda Handy is stepping down after 20 years on the board. It’s about time. Soon after her first election, Handy provided a key vote for hiring Elihu Harris as chancellor. Harris, the former Oakland mayor and state assemblyman, was never qualified to lead a community college district.

During his seven years at Peralta, the costly bond program was launched, and Harris awarded contracts to his business partner, handed out salary raises to his friends and ran up extravagant charges on his credit card — all while the district’s finances crumbled.

With Handy finally leaving, voters should elect Louis Quindlen, who was a machinist instructor at the district for 17 years before retiring in 2020. During his teaching career, he served on seven Peralta and Laney College committees, including the district Facilities Committee and the Laney Faculty Senate.

Quindlen understands the budget issues and the challenges ahead. He advocates for the district to develop a long-term plan that includes more career education and making Peralta a key place for training workers to boost the East Bay economy.

His opponent, Tarrell Gamble, is a financial analyst, member of the Alameda County Employees Retirement Association board and Handy’s choice to be her successor.

Area 5 – Cindi Reiss

When Reiss was first elected to the board four years ago, we strongly endorsed her because of her background. In addition to holding a doctorate in art history from UC Irvine and teaching at West Valley College in Saratoga, Reiss is a commissioner for the Accrediting Commission for Community and Junior Colleges.

It’s in that latter role that we expected her to provide keen leadership for Peralta, which had its own accreditation issues. She has fully met our expectations, digging deep into the district’s finances, especially its troubled bonds, and helping guide the district out of its accreditation struggles. If there had been more trustees like Reiss in years past, Peralta wouldn’t be facing many of the problems it does today.

Her challenger, Saleem Gilmore, an administrator at the Student Equity and Success Center at Cal State East Bay, might in another race be a strong candidate. But he fails to recognize that Reiss has been one of the people bringing to the board the sort of change he advocates — and Reiss has a much stronger understanding of the district’s finances.

Area 7 – Seth Steward

The Area 7 seat was held for nearly eight years by Julina Bonilla, who resigned in July for health reasons.

Seth Steward, currently chief of staff for Oakland City Councilman Dan Kalb, should be a good replacement. He served as a prosecutor for about 13 years in San Francisco and Portland, Ore., and ran in June for Alameda County district attorney but failed to make the runoff.

He’s now running for the Peralta board because, he says, the best way to decrease the crime rate is to increase the graduation rate. His top priorities include keeping the district in good stead with the accreditors, which includes good management of district finances, and finding a permanent chancellor.

His opponent, Sheweet Yohannes, did not show up at the agreed-upon time for her virtual interview.