The Davis School District is facing a multiyear, multimillion dollar shortfall due to the state’s economic and budget crisis. Complicating the already problematic nature of the state’s economy is the political impasse that has gripped the state’s budget process. That has meant not only are local districts facing budget cuts, they are dealing with large unknowns. The word leaking out of Sacramento is that the big five have reached a tentative agreement that could be announced today. Many are expected the results of that to be devastating to local governments and schools. As a result of the uncertainty, the district is planning for the worst–budget cuts with zero flexibility. That means pink slips and pay cuts are on the table. Right now the proposal is for a 2.5% cut for teacher salaries.
On Wednesday of last week, the Vanguard interviewed DTA President Cathy Haskell and incoming DTA President Ingrid Salim. You can catch the entire interview here.
This is the first of a two part series. Tomorrow, we will have the district’s response from Associate Superintendent Bruce Colby.
From the teacher’s perspective one of the biggest concerns is to avoid a repeat of last year when there were 114 pink slip notices sent out to teachers.
“You may recall that despite all of the pink slips that did go out, those are the RIF notices or reduction in work force, that say that teachers might get laid off. They sent out 114 of them. They rescinded I think all of them. They ended up hiring teachers this year because some of them had already found other jobs. So we knew that they were taking a very conservative path last year.”
The teachers hope that we learned something from last year however.
“We think they had learned something about the impact that had had on morale in this district this year, and at least these expectations now, even in the worst case scenario… the expectations are that RIF notices will be much much smaller. Superintendent Hammond was mentioning [Wednesday] twenty-something perhaps and that’s anticipated to even go down or be rescinded after the March 15 date when they have to get out.”
One of the questions that arises is if the district has and is using carryover or reserve money this year to plug some of the gaps, why didn’t they use that money last year.
Igrid Salim likened it to a leaky roof situation and whether you use your savings account to fix the leaky roof or you hold onto in case there is a worse problem down the line.
“You have a savings account, do you fix the leaky roof now or do you keep the savings account because something worse might happen later and just live with the leaky roof? That’s not a fair analogy here, but in the end it is the board who makes the decisions about how to use the money.”
In the end she said, the board felt more comfortable in terms of the overall status of the budget, by sending out pink slip notices to quite a lot of teachers rather than eat into the reserves.
However both teachers felt that this had a hugely detrimental effect on the morale of teachers, the students, the parents, the community and even the board and administration.
“We did learn last year that if you lay people off, even if they’re rehired that it has an enormous price on morale, which in the end has a consequence in the classroom and for education overall. I certainly know that our chief financial officer Bruce Colby and our Superintendent Dr. James Hammond have been incredibly earnest about wanting to not lay off people. They have certainly learned that that was a horrible process to go through.”
One of the key questions facing the district is how much flexibility the district will in dealing with the decreased amount of money.
“Things are going to be dire in terms the budget coming from the state which we don’t have yet. We have a couple of proposals, the Democrats have one proposal, the Governor has a different one slightly. Each of them have a lot of different factors which will impact how much money we are not getting from the state, not how much we get, but how much they will take back.”
However, regardless of the proposal, we could get something in the way of flexibility.
“We have looked at flexibility offered in the Governor’s proposal and there’s some in the Democrats’ proposal, but where pretty sure we’re going to get some flexibility.”
The two biggest areas would be an ability to use more of the carryovers from the previous year than we normally would. That would be a chunk of money according to Ms. Haskell. The other chunk would come from class size reduction money, something that the teacher’s would like to avoid even in Davis where that would simply mean going from 20 to 22 students per classroom.
Ingrid Salim explained how the categorical process works.
“Unlike our paycheck that we get every month that we can use however we want, budgets for school districts have little categories that you can only use for specific things, for example, buildings are called facilities money. You can’t use those monies to pay teachers.”
One item that might be cut would be money for new textbooks.
Ms. Salim explained that while the could use new Math and English textbooks, teachers are a much higher priority:
“We do have books, we could use new ones but we don’t *need* them, we need teachers.”
One of the big questions, and one of the things that the board and administration are asking teachers to do is to give up salary and possibly instructional days in order to balance the budget.
For both this seems to be the area of last resort, cutting salaries.
“We’ve talked long and hard about what we’d be willing to do. The short answer is this: there has been a suggestion that we give up a couple of days of salary, and the other union has been asked the same, and the administrators have been told that they will be expected to do that.”
Cathy Haskell said that cutting two days from the instructional calendar would be approximately one percent pay cut. So a 2.5% pay cut would be the equivalent to five days of instructional time.
“There are some very interesting discussions about what does it mean to have one less day of school. Or does it mean that we still have that day of school, we just don’t get paid for it.”
Ingrid Salim quickly followed up on that thought:
“So what she’s referring to is a voluntary cut in salary without a reduction in days. That’s another option on the table.”
However, the teachers seem opposed to this option.
“We believe that there are measures that we can still take that on paper will of course balance the budget without us having to give up.”
However, the district seems to feel otherwise and are now moving ahead with a plan to cut 2.5% from salaries. A plan that may not come to fruition depending on what the budget looks like as it announced today (if it announced today).
“Our reasoning is that it’s not just us giving up salaries, which absolutely we are affected by, but it certainly takes away from the educational process in this district. So if take away two days from instructional time, that’s two days students are not in class. If we take two work days from our time, that’s two days that we’re not preparing. We don’t feel that this serves education and we’re not willing to take the hit when there are other things that can be done.”
“Unfortunately it would impact real people who already make less than half of what our top administrators make. We don’t really want to point that out all the time, they do a tremendous job. But most of us are parents that have children that live and work in this city. We make the normal salary that teachers make, it’s not off the charts, it’s livable, but it would hurt us, we would feel that particular amount [of cuts].”
However, she said that as a last resort, and there is nothing else that can be done, they would be willing to enter into discussions on this. They simply believe that other options exist at this time.
Ms. Salim continued:
“If we felt we had to do that in order to put the district in a state where it had a balanced budget, I think we’d be willing to talk about that. We really do believe there are ways to begin addressing the budget deficit.”
One of the biggest differences that is emerging between the board and the teachers is the issue of self-qualification. The district is required to show a balanced budget for a full three years. Under normal conditions that is a reasonable requirement. But when you do not actually have a budget, it gets tricky to try to budget for the third year.
As Ingrid Salim put it:
“It’s the absurdity of trying to balance the budget three years out without even a current to really work on. We’re talking about assumptions, putting numbers into a spreadsheet, plugging in equations, to figure out numbers for a budget that we don’t even have.”
The district is moving toward more draconian cuts right now primarily because it is trying to have a positive assessment for 2010-11. The alternative is to balance the budget for this year and next year, and then address the problems with 2010-11 in the future when there is more certainty.
That is the approach the teachers favor.
“one of the ways that we would advocate that we would make the budget balanced now is what is called a self-qualification. On paper we acknowledge that that third year out we don’t make ends meet. We will deal with that over time. If we self-qualify that way and make a couple of other cuts, there are no cuts necessary right now in order to balance the budget right now. We say that we haven’t balanced it, we acknowledge that…”
“We don’t want to cut salaries; we don’t to want to cut people. Let’s allow ourselves to be self-qualified. Let’s allow us to take our reserves down to the legal limit—it’s been hinted that we’d be allowed to drop them further than they are. That’s a little bit nerve wracking because it means you have less in your savings account. We advocate let’s do that first—yes, it’s less conservative, but we believe it’s a better policy to keep people and keep their salaries where they are and allow them to live, than it would be to do anything else.”
The teachers feel respected in this process by administration.
“We’re feeling valued from them [the administrators]. We’re not completely sure that the board understands all of that. But then we acknowledge that none of them are fiscal experts. They are all people donating their time mostly to serve in this capacity. We really appreciate the amount of time and energy that they put in trying to wrap their minds around pretty big issues. It’s quite a lot for them to take in in small amounts.”
Last year, the district tried like the plague to avoid self-qualifying. The fear was that the county would take over the school district and that would be a horrific outcome, we would lose out autonomy.
“Last year, don’t self-qualify… the county will come in… They heard this over and over. So they took action that was very conservative to prevent that. This year, they’re hearing the sky won’t fall in, it will be okay.”
It is difficult to understand why that has changed now. However, according to the teachers, what has changed is the fiscal circumstance of the state.
Cathy Haskell was actually willing to take more of a chance last year rather than face the wrath of 114 layoff notices.
“I think it has to do with your level of risk that you have to take… 30% of the school districts last year ended up doing not a positive certifications. This year with the numbers the way they look it is for me not a surprise to hear that self-qualifying keeps you from doing some things that maybe you don’t want to do. I was actually ready last year to take more risk, but as a collection of people we couldn’t get there. I think we’re in a much different place this year, knowing that it’s not about this year, it’s not about next year, it’s about the second year out. Last year we were actually talking about the current year.”
One of the things that has changed is that the process was horrible that no one wants a repeat of that scenario this year.
As Ingrid Salim explained, the entire point of self-qualifications is to prevent districts from mismanaging their money. During an economic crisis when the state is drastically cutting back its funding for local districts, counties are not going to immediately assume that districts are in the red in year three because of fiscal mismanagement. This is particularly true for districts that have a good track record.
“We’re looking at something like 70 percent of districts in the state of California who might be doing that. That’s just a reflection of not having a budget now, not having assumptions, and seeing that there’s no way to make it balance in three years unless you cut your staff.”
As Cathy Haskell put it, the problem this year is the state’s revenue stream to local districts, not our fiscal management.
“Last year we chose to show that we had a positive certification. And to be positive it means you have to show that all three years you will be in a positive cash flow.
This year the trouble isn’t how we’re organized as a school district, it’s the funding from the state. With the Governor’s projection of what the budget for the state will be, I don’t know a district in the state that won’t be in trouble the second year out. Most of them will be trouble next year. We now have some of that cushion of Q and W, but nobody has a cushion for a 16% cut.”
Igrid Salim continued:
“Both from Bruce Colby’s understanding of what this means and the circumstances and the landscape changing, a self-qualification today isn’t going to mean the same thing that it meant a year ago.”
Moreover, the hope is that seeing actual numbers will produce less drastic results.
“We want to wait and see how the budgets are going to really come in over the next year, and then we’ll accommodate that. We know that counties now are going to look at that and say okay, they’re thinking about that, they’re on top of it, they’re not losing it, they’re not going to be going bankrupt… So the reigns are a little bit more lax.”
Ms. Salim also believes that because so many districts are facing these fiscal problems, that counties will be more reluctant to intervene, having not the resources to do so. In the worst case scenario, the county could hire an accountant to oversee the district’s books. But she played down even this possibility.
“We don’t expect that to happen because there will be so many in this situation and because it’s a reasonable situation now. If we were flush with money, it wouldn’t be reasonable to be self-qualifying.”
One thing both agreed upon is that there is no way to cut our budget without deep cuts. The bad news is that we do not have a lot of pork and extra programs that can simply be cut. So any cut that the district makes will be painful.
Tomorrow we will see that the district does not agree with some of these assessments by the teachers, particularly with regards to self-qualification and also cuts to teacher salaries.
—David M. Greenwald reporting