Colt’s Blog

Together we will reach, teach, and inspire each student to excellence

The recession has taken a heavy toll on Oregon’s schools. According to the Confederation of Oregon School Administrators (COSA), over the last three years Oregon’s schools have seen a 15.9% teacher job loss causing class sizes to increase 20-30% across the state. In most districts, boards  have spent down their reserves and employees have taken salary and benefit reductions – yet cuts still had to be made that impacted services for students.  Today the recession continues to impact Oregon. The private sector is just beginning to see signs of recovery with slow job growth. The public sector is still heavily impacted. The 2012-13 budget for Bethel School District will see a continuation of employee concessions on wages, use of remaining reserves, and further cuts to staffing.

This economic crisis has also had a considerable impact on our District’s families. Over the last 3 years the local unemployment level has fluctuated between 10-12%. Our staff members continue hear from students, parents, and co-workers about losing homes, moving out of the District to seek employment, or combining households to make ends meet. The recession has resulted in lost work hours, reduced wages, and job loss for many of the families we serve. This economic situation clearly shows in an increased need for our free and reduced price meal programs. Prior to the recession the percentage of our population participating in this program was about 50%, while we are over 60% today; this is an increase of more 600 students facing poverty. We are regularly breaking records for the number of meals served in a day. Our families and our community are still hurting economically; so far this school year we provided specialized services to more than 300 homeless youth.

This statewide decline in income has, in turn, impacted revenue for the District. As unemployment levels remain high, state income tax revenue continues to decrease and as a result state funding to schools declines. The District continues, for a fourth year running, to see a slight decline in enrollment. This is very different from the growth seen over the previous 20 years.  In 2008-09 the District was forced to decrease budget expenditures by about $1.1 million mid-year. At that time we were able to avoid cuts that impacted students directly. In 2009-10 the District planned for a $9 million dollar adjustment to its budget. This included reductions to staffing and supplies at all levels, use of Federal Stimulus dollars, and a series of employee concessions including up to 12 furlough days for students and staff.

In January 2010, Oregon voters passed ballot measures that generated about $560 million in state revenue. This, combined with legislative action to secure additional state reserve funds for K-12 schools, had a positive impact on Bethel: 10 cut school days were restored to the 2009-10 calendar. However, the 2009-10 school year still saw a shortfall of $7.4 million compared to the amount needed to maintain service levels. In 2010-11 the District faced a $5.1 million deficit to maintain current service levels. The solution once again came from employee concessions, cut school days, Federal Stimulus funds, and reductions in some services and supplies. Last year we saw increased costs for the Public Employees Retirement System (PERS) and our deficit increased to $6.2 million. This time the solution came from employee concessions, cut school days, state stimulus funds (one time School Year Subaccount dollars), and further reductions in services and supplies.

The planning, input, cooperation, and careful consideration that has gone into the development of this 2012-13 Proposed Budget has been a continuation of efforts to increase revenue and seek savings over the last several years. The efforts have resulted in a budget which will not entirely meet the needs of our students. The fact is that there will not be revenue resources available to return the District to pre-recession compensation, supply, staffing, and program levels. In spite of reductions over the last few years, the District has still garnered great success with continued improvements in literacy instruction; implementation of a new math program at elementary and middle school levels; partnerships with local agencies to provide tutoring services; grants to deliver new instruction at the high school level; a new pre-kindergarten program; initiatives to fight childhood obesity; improvements to parent access to student information; advances in providing healthy local foods to our students; new teacher and administrator growth and evaluation processes; the opening of a school-based health center; new educational enhancement grants and school beautification efforts through the Bethel Education Foundation; an active and effective College and Career Center that is successfully attaining more scholarships and support for high school students; and the list goes on. These projects are a testament to the giving heart of our staff and community. The Bethel family wants the very best for its kids and is seeking out opportunities to do just that. Because of these efforts our students thrive in a number of ways: With statewide achievements in basketball, swimming, chess, DECA, FBLA, OBOB, cheerleading, music, culinary arts, math, and more. With the support of Bethel programs and staff, our children are not only reaching for excellence, they are achieving it.

However, the fact remains that the 2012-13 budget is still not adequate to meet the needs of all our students; especially in light of the increasing state diploma requirements. To put a clear picture on how this decreased level of funding will impact services, I will turn to Oregon’s Quality Education Model (QEM). The QEM is a regularly updated bipartisan study that determines the level of funding required to ensure that 90% of Oregon’s students reach the state standards and are able to earn a New Oregon Diploma. The QEM includes recommendations on class size, technology, counselor ratios, and much more. In order to fund schools at the QEM level for the 2011-13 biennium, the legislature would have to allocate $8.75 billion for K-12 education. Currently, Oregon schools are funded at nearly $5.7 billion; that is $2.95 billion short of QEM recommendations. This is more than 30% shy of what the QEM says is required for student success.

Developing a Proposed Budget at this revenue level has required making difficult choices around compensation, staffing reductions, supply and service reductions, and consideration of the use of reserves and ending fund balance dollars. It required the utilization of an ongoing, inclusive and thorough process for budget development involving many contributors. It began with regular information sharing and input gathering, beginning as far back as November 2008. It included the processing of goals, reductions, and creative cost-saving ideas in small and large groups of varied make-up. It included consideration of more than 250 cost saving suggestions brought forth by parents, community members, employees, and students. It included thoughtful, time-consuming deliberation by administrators and cooperative, forthright, and dutiful bargaining with all our employee groups. This included meeting and deliberating budget options with the Long-Term Budget Planning Committee, a group with diverse district and community representation. This committee helped to create criteria with which to make future budget addition and reduction decisions. The District will continue to use this group to review long-term budgeting plans. The entire process culminated in the Proposed Budget presented here.

The 2012-13 Proposed Budget is a mix of sustaining reductions made over the last 4 years, continued use of reserves, significant additional staffing reductions, and continued employee concessions. The Proposed Budget reduces teaching, administrative, and classified staffing levels. The licensed staffing ratio will reach unprecedented levels by adding 3.9 students per staff member in the ratio. This will impact average class size across the district. Bethel will have more than 30 fewer teachers and counselors in 2012-13, some of this due to a projected decline in enrollment and some due to the staffing ratio change. Administration will also see an approximately 8% staffing reduction, while further centralized reductions will come from district clerical and teacher-on-special-assignment (TOSA) reductions. Additionally, the District will see classified staffing reductions impacting all levels.

This budget relies on employee concessions to minimize the impact on programs and class sizes. At the time this message is presented employee concession talks are still underway. Considerations are being made to eliminate or reduce increased costs to the District. Cost of living and seniority step pay increases, insurance increases, and a continuation of 10-13.4 unpaid furlough days are all being discussed. For the last two years students have lost 8 school days each year; that may continue in 2012-13. This makes it difficult to provide necessary instructional time to help students meet essential skill levels now required to earn an Oregon Diploma, and it puts the District’s fourth and fifth grade students below the state guidelines for instructional hours for a third year in a row.

The District has negotiated aggressively to minimize increases in contracted services. An example of this is decreasing contracted custodial services to save $85,000. The District continues to review all education options and shift ESD programs that can be managed in a more cost-efficient manner to Bethel. This frees ESD funds to be used in new ways to support the District. As a result this year additional dollars and services will be directed to Cascade Middle School, which became a mandatory Title program due to an increase in the number of its students living in poverty. This shift in ESD dollars also spares the District from thinning Title I services across the elementary programs to create the new Title program at Cascade.

Each element going into this year’s budget is designed to help the District reduce costs and maximize revenue while keeping this agreed upon budgeting philosophy and its accompanying priorities at the forefront:

   The quantity and quality of programs offered by Bethel School District are related to both the amount of funding provided as well as the effective and efficient management of those funds.

   To maximize the benefit to our community’s children the District must continue its effort to cultivate strong relationships with and between students, parents, staff, and community members in local fiscal decision making.   In optimizing those funds for the benefit of the students, the District will strive to:

• Maximize the positive impact on classroom instruction, instructional support, readiness to learn, and efforts to increase student achievement and engagement so that all students make progress toward meeting state standards, District goals, and personal aspirations. 
• Protect and maintain the community’s investment in our facilities, physical spaces, equipment, and other assets.
• Prepare for both short and long-term fiscal responsibilities including: labor agreements, reserves, fund balance, planning for current and future mandates and community needs, and by investing in the sustainable growth of new and existing efficient and effective programs.

If the Budget Committee opts to suggest changes to the Proposed Budget, I believe it is important to keep these priorities at the forefront of decision making. The priorities were developed by the Long-Term Budget Planning Committee and adopted by the Board. It is also important to carefully reflect on the interplay of elements used to balance this budget if any changes to the Proposed Budget are to be enacted. A change in one area of this budget will have consequences on the feasibility of other portions of the document.

Sustainability is a key factor in the development of any budget, but especially a declining revenue budget. The district has faced budget sustainability issues from the onset of the recession. These have included declining state revenue, increasing personnel costs, short-term federal and state funding, and use of District reserve funds. This Proposed Budget is the first in two years without the inclusion of significant Federal Stimulus revenue or one-time state funds, which alone decreases revenue from the previous year by $1.3 million. At the same time the budget also includes a significant new expense over the previous biennium; an increase of approximately $1.3 million imposed by the PERS. The Proposed Budget does continue to use unsustainable tools to achieve a balanced bottom line. Employee concessions and reserves (the Ending Fund Balance and the Land Acquisition and Maintenance Fund) will be used to offset the deficit.

These concessions have had a significant and beneficial impact on the district’s budget for four years running. However, they do not constitute a sustainable solution. They help address issues for a single year at a time, then previous employee agreements fall back into place. This unsustainable practice will lead to one of three future outcomes: (1) Employees and the District through normal bargaining or determination processes permanently reset compensation at sustainable levels; (2) Significant staffing reductions are made elsewhere in the budget to compensate for current salary and benefit costs; or (3) The District realizes a proportionate and reliable increase in State School Fund revenue

I will conclude by sharing my high level of gratitude toward the staff of Bethel School District. Even under some of the most difficult circumstances, I have witnessed incredible dedication to mission. I continue to hear comments like, “We understand the situation”, “We can make it work”, and “We have to get it done, our kids need this.” These are not unusual statements for educators to make. The difference in Bethel is the words are turned into actions.  Here, I see staff willingly sacrifice. Here, it is all about the kids. Even with the reductions sustained over the last two biennia, our student achievement has continued to rise because of the caliber of our staff. I continue to be humbled by our staff and our community, and I’m proud to lead in Bethel. Even though circumstances over the last several years have been counter to this effort, my goal is to guide us peacefully through the economic crisis and successfully put us on the path to financial stability and great student success.

This message will be delivered publicly and further discussion may take place at our Budget Meeting on May 14, 2012. Then, on May 17 the Budget Committee will reconvene to hear presentations on the administration, special education, individual schools, and “all schools” portions of the budget. May 17 also offers the first opportunity for Budget Committee approval of a 2012-13 budget for Bethel School District. To the Budget Committee I say, thank you for your willingness to serve the Bethel School District and its community; we look forward to your questions and guidance as we move toward approval and adoption of this budget for 2012-13.

Acknowledgements

Many individuals have worked diligently to create this draft budget. I would like to recognize those who have contributed significantly to its development, foremost, our Budget Director Ellen Mooney. Additionally, Connie Alsup, Linda Northrup, Nathan Voelsch, Shirley Rasler, Jill Busby, and Gayle Wood worked collaboratively to prepare this budget document. I also appreciate the advice and expertise I received from Chris Parra and Pat McGillivray. The district and building administrators have provided much time and invaluable input. We owe thanks to Jim Dixon, Charlotte Baarstad, and Becky McDermott for printing and delivery of this document. Finally, I would like to thank the Board and Budget Committee for the time they will be volunteering to review, advise, and guide us in our efforts to meet students’ needs in Bethel School District.