Schools

Bartlett: School Budget Headed for 'Cliffhanger'

The lack of pain and drama now could create huge problems in the next two years, the Board of Education chairwoman warns.

The is racing toward a budgetary cliff and needs to start hitting the brakes to prevent a catastrophe, Board of Education Chairwoman Alison Bartlett warned her colleagues Wednesday night.

“We have a budget right now that is not sustainable,” she said.

Speaking just before the school board went through the proposed fiscal 2012 budget line by line for the first time in public, Bartlett said one of the candidates for the superintendent job told the board there are two approaches to budgeting right now: the slide and the cliffhanger.

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If you use the slide, you cut and save as much as possible every year, accepting that there will be pain along the way. If you choose the cliff, you do everything possible year by year to cover excessive spending, until one day you find yourself about to go over the cliff.

“Two years ago,” Bartlett said, “we were at that cliffhanger” when the school system had to make dramatic cuts, including an across-the-board 2 percent pay cut for employees that still left the system looking at a $127 million deficit last May and led to laying off 579 teachers. Most were offered their jobs back before this school year.

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The proposed budget the school board examined Wednesday night has no such problems on the surface. As Chief Financial Officer Mike Addison , the budget would balance without layoffs or tax increases by using two furlough days (down from five this school year), 178 instructional days (down from the usual 180 but up from 175 this year) and $22.2 million in excess revenue from the school system’s last Special Purpose Local Option Sales Tax, SPLOST II (Cobb is now operating under SPLOST III). The budget includes a midyear step increase in pay for teachers.

But Bartlett, who represents the south-central area of the county around , pointed out that the proposed budget is on shaky ground, with $851.8 million in expenditures and $817.3 million in revenue, including the $22.2 million in SPLOST II money the board is expected to use.

The plan relies on $34 million in one-time money left over from this year: $25 million set aside for anticipated midyear cuts in state funding that never came and $9 million in federal stimulus money the district didn’t spend.

The use of one-time revenue and excess SPLOST money totals some $56 million for a school system with a general fund balance just under $80 million, slightly more than one month’s expenses. That’s the cliff Bartlett fears the school system is racing toward if the economy doesn’t bounce back.

“I’m not comfortable that the economy is going to continue to improve,” she said, citing federal borrowing of $100 billion per month and gas prices nearing $4 a gallon.

The school district might reach the edge a year from now when it creates the fiscal 2013 budget without $34 million in one-time funds; it might get there sooner if the state, which funds 46 percent of the Cobb school budget, decides to return to midyear austerity cuts. In that case, the system would tap its fund balance as an emergency reserve.

The situation is “high risk … for how we’re going to deal with the future,” Bartlett said. “I don’t want to go through what we went through again two years ago.”

For perspective, Addison explained what the school system will have to do in 2011-12 to balance the budget if the board neither uses excess SPLOST funds nor raises the property tax rate from 18.9 mills to 20 mills: Use five furlough days instead of two; have 175 instructional days instead of 178; increase the average class size by one student and thus cut 148 teaching positions; and run buses only to students living at least 1.5 miles from school instead of the current half-mile for elementary pupils.

West Cobb board member Lynnda Crowder-Eagle said she’s not willing to increase the number of furlough days, each of which saves $2.8 million on personnel and $200,000 on transportation, so she asked Bartlett: “What would you do instead?”

Bartlett had no answers but instead said she wants Addison to go back through the budget and look for more savings before Superintendent Fred Sanderson retires at the end of June and costs the school system three decades of budget experience. “If we don’t deal with this now, we’re going to have to deal with it in the next two years.”

Sanderson did caution the board to take a conservative approach because the system is spending more than it takes in.

Still, board members expressed ideas for more spending Wednesday night, not less.

  • David Banks, who represents East and Northeast Cobb, said he wants the school system to restore the 2 percent pay cut from 2009, which Addison said saved about $17 million. “Even a half-percent would be something.”
  • Board members asked about increasing the pay for substitute teachers from $69 a day, which Banks called an insult, to $95 a day or even last year’s rate of $79. The cost of going to $95 a day would be more than $2 million.
  • Bartlett said the system should give nurses a pay raise as soon as possible because, unlike teachers, they don’t get raises for increasing experience even though they took the 2 percent austerity cut in 2009. She said nurses play a crucial role in education because they help keep students in the classroom.

Having already urged her colleagues away from the cliff, though, Bartlett acknowledged that the money isn’t there.


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