Before the recession, school district budgeting was not quite the bear it is today. Each January, the House Ways & Means Committee would announce the amount they planned to fund the Base Student Cost (BSC), a primary piece of district revenue, and it would generally hold up through the entire legislative process. There was usually discussion of how much the teacher pay raise would be, and we could count on a somewhat increased amount of revenue to fund our programs. School Boards with fiscal autonomy could have their budgets agreed upon long before the June 30 deadline.
It is not like that anymore. Last June 28, after building our budget on the information we had from Columbia, the Governor vetoed the "hold harmless" proviso and the legislature failed to override the veto costing our District over $1.3 million we had counted on. Too late to make any changes and have a balanced budget to report by July 1 as required by law, we have operated this year by pulling money from the building fund balance.
In comparison, in 2008, districts received $2,476 in BSC. This year we received $2,012. The legislature so far is saying $2,101 for next year (even though the Education Finance Act says we should be receiving $2,771 for FY 13-14). Every $100 in BSC means about $1 million for District Two. So, we are in a very difficult situation again.
Additionally, we are predicting an increase of 100 students, and with roll ups of current students, we need 9.5 more teachers. We also would like to provide a literacy and math coach for every school, an additional 9 positions (The AdvancED visiting team gave us two directives: enhance our technology and utilize instructional coaches to strengthen and extend best instructional practices across the District). We are also in need of $135,000 to continue funding the sheriff's deputies patrolling our elementary schools and will need some additional athletic and fine arts supplements next year. The 2% step increase for employees will cost about $800,000.
Therefore, to provide the resources necessary for these increases, we believe it will have to come from local funding as the State Senate has shown little interest in increasing the BSC from the House's $2,101. Administration is asking the Board of Trustees to fund these personnel needs which may necessitate a millage increase within the cap established by the legislature and with an option we have only used one time in recent years: a salary adjustment for our working retired employees.
Several years ago, when the BSC hit a low of $1,630, we furloughed administrators for 10 days, everyone else for 5 days and cut working retirees' salaries by 15%. It was a one-year situation that we were able to reverse. Many other districts dismissed all working retirees and if they were replaced, it was with less experienced (and lower cost) employees. Some districts adjusted salaries to something along the lines of a bachelor's and 5 years experience. Most of those districts have continued to do so as the state funding has not yet returned to the levels of 2008. We, however, greatly value our most veteran employees and have avoided making that decision as long as we could. But it is, to us, about our only option if we wish to provide our staff and students with the support needed to provide an outstanding education. A 15% salary reduction will save the District about $500,000, or $450,000 if it is only administered to certified staff.
So, if the Senate does not come through with a large increase, and the Board approves administration's recommendations, our retired employees will see their pay reduced. My encouragement to them is to remember that they will still be earning more with their retirement checks than they will lose from the 15%. All of us know when we take the option to retire, our contracts are no longer "continuing," but “at-will;” it is a chance we take. My hope is that this, too, will be a one year situation and that as the economy improves, and we elect pro-education representatives, we will be able to reinstate the salary schedule for all.
It is a difficult decision, not one arrived at lightly and delayed as long as we thought we could in the hopes of not having to go this direction. We hope it will not be a deal-breaker with our most veteran employees.
If you have a question, suggestion or observation about this information, do not hesitate to contact me.