DATE: June 24, 2008
TO: All Employees
FROM: Walt Rulffes
SUBJECT: Status of State Budget Cuts
Many people have contacted me asking the status of how CCSD will handle the increasing State budget cuts. An answer I gave that was accurate last week needs to be revised this week as the picture continues to change. If you are observing media reports, then you are likely as current as I am regarding the amount of State reductions in revenue. The purpose of this memo is to bring you up to date regarding how CCSD is affected, which most likely will change as State conditions change.
I won’t discuss herein the initial cuts that have already been made, as that information has been provided elsewhere and is not germane for this discussion. Of importance now is how does the district deal with more major reductions in its funding?
Here’s the gloomy background. The latest State projected additional revenue shortfall, after more than $900 million has already been cut, is identified below:
$250 million or more for the fiscal year beginning July 1, 2008; and $1.2 billion for the next biennium, which is the 2009-2010 and 2010-2011 school years.
The big question is, “How much will CCSD’s share of the shortfall be?” I wish I knew, but since public education as a whole makes up half the State’s budget, it’s a fair assumption that CCSD’s hit could be as follows:
Another $50 to 70 million for 2008-2009 school year; and Another $135 million for the 2009-2010 school year.
Against this background, here’s my prognosis for how funding reductions will translate to CCSD.
Q: What about the 4% employee COLA the Legislature included in its original funding?
A: The District and Unions followed the provisions of collective bargaining and put the 4% COLA into contract agreements. The Support Staff Union contract was ratified by Support members and approved by the School Board. The CCEA and the CCASAPE contracts have been ratified by their respective members and are scheduled for School Board action on
June 26, 2008. My recommendation is to approve the contracts.
Q: What about all the talk of taking the COLA’s to offset the State shortfall?
A: Here’s why I am recommending to the Board to approve the contracts. First and foremost, you deserve it. I don't know how we can expect our employees to absorb the increased cost of living, e.g., gasoline, food, and in the case of teachers – health care. There are about 7,000 employees who are not eligible for a step-increase, and the 4% is their only improvement. The support staff contract has been signed, sealed, and delivered, as well as the employee contracts in most other school districts throughout the State. I do not see how school districts can legally breach contract agreements, and CCSD’s staff deserves equal treatment to that of other school districts in regard to the COLA.
There’s more. While this has not been widely recognized, if the District/CCEA contract agreement is not approved, the new program for the retired teacher health plan falls through the crack, leaving future teacher retirees without a reasonable medical plan.
Q: So what’s the consequence of the cuts?
A: Well, hopefully the State will minimize cuts to public education with other alternatives – to which I am not privy at this time. I know that there are legislators and others who are seeking options to avoid further cuts in essential State services. Examples include the proposed 3% room tax, Terry Lanni's proposal to add an increase in the payroll tax to the mix, and borrowing against future revenues such as the Tobacco fund.
Q: If further cuts are necessary, what’s at risk in CCSD?
A: This is the tough part. We will be forced to cut the central, regional, and school administrative services where we can, as well as support functions. The Budget Department has already told central administrators to submit 6% cuts in their budgets. Out-of-state travel requests, contract and consulting services, and capital purchases from the general fund will require approval of the Budget Department. The Human Resources Division (HR) has placed a hold on certain categories of hiring, not only because of the budget cuts that are looming, but also because enrollment growth has dramatically slowed. Expenditures from the SB 185 funds, which are the school improvement grants, have been put on hold. SB 185 funds will likely be withheld by the State. Also, remember the District is facing unfunded inflation (as in fuel) and added costs (as in 7 new school openings). Some relief could be possible if a fee is imposed for certain services, e.g. transportation and non-academic activities, but it will be very unpopular.
The big dollars will have to come from where big expenditures are occurring. HR is holding many classroom vacancies open until more is learned from the State because those vacancies will likely be needed to absorb teachers who are currently assigned to non-classroom functions. In an earlier message, it was estimated that the projected reduction in CCSD revenue is the equivalent of an estimated 2,000 positions. Nothing has changed to reduce that estimate.
Q: What’s the timing of all this?
A: Timing depends on the State. At the time of this writing, the Legislature is scheduled for a special session to begin on June 27, 2008. If that occurs, or if a resolution is worked out prior instead of having a special session, we should know before July 1, 2008, what the fiscal impact will be on the upcoming school year. At this point, the bulk of what I am hearing centers around "cuts" rather than finding new revenues to make up the difference.
Q: What's the prognosis for the budget we're submitting for the next biennium?
A: We have been directed by the Nevada Department of Education to submit $133 million in cuts for the next biennium in September of 2008, which takes effect for July 1, 2009, assuming it’s approved by the Legislature. While we are complying with this request, it is important to remember that the level of funding for education and the opportunity to provide new revenue sources will certainly be a major topic of the 2009 legislative session, and I hope you will join me in working to find alternatives to the devastation this level of cuts would produce.
God forbid our governor raise taxes on local folks to, you know, learn their kids to read. I'm really REALLY glad our weak excuse for a union (an "association," actually, as if that explains the inefficacy of most of their presence in Carson City) bundled the cost of living increase in with provisions for retiree health benefits. At this time last year, when it was unclear whether retirees after 2008 would, in fact, be eligible for insurance coverage, we were projecting something like 5000 people to retire this year, and I just don't think the state wants to have to deal with it's largest county's teachers not getting salary increases AND needing to hire 5000 more new teachers.
What I find most worrisome is that it looks like the area that'll be taking the biggest hit is research. Ruffles mentions curtailing expenses for "consultants" and SB 185 funds, and it's that money that A) brings new research into the district and B) disseminates it to teachers--new teachers in most cases. SB 185 money is designated "School Improvement" money--we all write a school improvement plan each year, and these funds help schools achieve their goals, generally in the area of subgroups passing the Big Tests. Schools with a pattern of not making AYP get extra help, such as mentors and money to pay teachers to go to conferences, and to pay other teachers to come to site-based trainings to hear what the other people learned at their conferences so that everybody can stay up on current research.
Yes, we could probably limit some of the "consultant" spending because I've seen some of the people and research the district brings in, and a lot of it is redundant and I'm sure some of it is pretty screwy. On the other hand, Harry Wong spoke at one of the new teacher conferences I went to, and all teachers got treated to a presentation by Ron Clark one staff development day last year, and I found both of those experiences valuable. And it was SB 185 funds that paid for the two full-time mentors I had at the middle school in Northtown, where I learned enough in a year and a half to be a project leader next year and my administrator's nominee for Teacher of the Year.
Maybe it's not all bad. Because our district is so huge (fifth largest in the nation), reducing the amount spent on research consultants means going back to tried and true practices and GIVING THEM TIME TO WORK before jumping straight onto the next bandwagon when we don't see immediate results. Cutting funds in these areas will allow our district to function reasonably well for next year, even two or three more years, but I don't want to be around here in another 10 when we're really feeling the effects of allowing our district's current research-based practices to stagnate. Once the state sees that we can do without this budget money, the odds of us getting it back are slim, and funding will probably never be back to the level it is now. I also think we'll see much lower retention rates for new teachers because it is primarily them that the SB 185 money helps. Most of our new hires are locked in to jobs veteran teachers don't want, and without a support system present, I can imagine many of them looking at their measly $34K salary and wondering if it's really worth it. And there's not much of an incentive for veteran teachers, especially those approaching retirement, to pass on their expertise or to continue to develop their own practices.
So anyway, we'll see how this goes. I've been fortunate this summer in that my principal is highly committed to my program and finding the money to get it off the ground. She submitted my entire list of facilities requests, about $18,000 total, to the banker without striking anything, quibbling about costs, or even questioning any of the items we asked for. Nothing can get paid for until the July 1, but so far, my stuff's first in line. It's not district budget problems that affect me, I just need to make sure I keep the same principal forever.