Drastic Measures and Grandiose Gestures by the School District

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The headlines that came out of Thursday’s school board meeting were dramatic with the Superintendent suggesting that the top four administrators would take double the pay cut that they were asking teachers to take in order to send the message that they were serious about the school budget crisis. Beneath those sensational headlines is a truth that is every bit as bleak but perhaps not quite as sexy.

The truth is somewhere in between here. The first factor that people need to understand is that in some ways what was discussed on Thursday night was the choice of the school board. They were presented options the previous week and could have chosen to self-qualify.
Self-qualification is a complicated process that was explained on the Vanguard radio show fairly well on Wednesday night. But in short, given the budget crisis, the district could have taken the latest assumptions from the governor’s budget, said that they would deal with 2010-11 in due time, and cal it a budget.

The problem as Cathy Haskell current DTA President and Ingrid Salim, incoming DTA President explained on the radio show is that the board was told last year that self-qualification would be a red flag to the county that there were fiscal problems. That is because a large extent of the district’s fiscal problems last year were in-house and local. That is not the case this year. There are estimates that 70% of the state will self-qualify. The reason for self-qualification is that the first two years of the budget would be balanced but the third year, 2010-11, would have an on-paper deficit that would need to be addressed. In a state budget crisis year, this is not the alarm bell that it would have been last year.

Nevertheless the board was not comfortable with self-qualification and instead are looking for the three year balanced budget. The result is additional pain of trying to anticipate three years out without even hard numbers for this year’s budget. And they must do it by March 15.

As Sheila Allen put it on Thursday:

“It’s just so frustrating that we have deadlines that we have to meet and other elected officials are not. So we’re working with ‘fiction’ and we’re messing with real people’s lives when it’s based on fiction, it’s very frustrating.”

In addition to the school board making the situation harder, Thursday’s budget also assumed no flexibility. This is probably a wise decision at some level. The CTA has launched a veritable battle against any flexibility in CSR (Class Size Reduction) requirements. Moreover, they have opposed categorical flexibility as well. Still, it appears likely there would be some flexibility.

As we walk quickly through the numbers, all of this suggests that the grand gesture (largely symbolic) made by the top four might actually be a worst case scenario rather than the operating assumption that was suggested in the headlines on Friday.

The budget challenge as laid out by Bruce Colby is how we reduce the cost of delivering our programs without reduce the level of the programs we provide. Moreover, the district has a structural deficit, it is basically eating at least $1 million in reserve each year by these budget assumptions. It is doing that in order to both maintain our programs and avoid the painful layoffs that were proposed last year.

In short, what the district needs to do is to reduce on-going expenditures by $4.9 million or more over the next two years to maintain fiscal solvency. That is $3.3 million in 2009-10 and an additional $1.6 million in 2010-11. And 2010-11 is probably on the low side unless the economy and budget forecast improves. Even with that, the district will continue to have a structural deficit of $1 million which will need to be addressed by 2011-12.

As Associate Superintendent Bruce Colby said:

“At some point we will run out of reserves and we will have to close the gap for the last million dollars.”

The district examined the salary breakdown for 2009-10 by bargaining unit. Their proposed cuts are roughly proportional cuts across the three classifications ranging from 3.68% among classified (support staff), 3.88% among certificated (teachers) and 4.15% among unrepresented (management and administrators).

Under this scenario they are taking out three counselors, they think they can find 200,000 by shifting around unused parcel tax money, but $910,000 is coming from increasing the student to teacher ratio for grades 4-12 which are not governed by CSR requirements. That means losing teachings, perhaps as many as 14. Some of that could be obtained through attrition–retirements and transfers.

However, and here is where the real painful decisions come in. Those cuts still leave the district one million dollars short.

So the bottom column on the grid shows the possibilities for accomplishing that savings. One is what was talked about last week, would be federal stimulus package dollars. It is possible the district will get $2.7 million, but we would have to look more closely at the Senate’s version. There is also a possibility that the Davis Schools Foundation will be able to raise some of that money, but these days are a bit tougher for raising money than a year ago.

On the other side of the ledger are flexibilities that could be granted by the legislature. The adult education program has a $200,000 that is categorical money, which means that the district could be allowed to use it for general fund if they get flexibility on that. There is an additional $1.1 million in categorical money that could be used if granted by the legislature. And then there is about $1 million in CSR that could be used if they raise the ratio of students to teachers from 20 to 22. However, as mentioned that is going to be a political fight and the DTA seems to believe that there are other ways to get that money.

Now here is finally where we get to the sexy headlines which are not so sexy. If all else fails, one possibility is that the teachers and in fact all employees take a 2.5% pay reduction. That would free up $1.26 million that would cover that million hole.

It is here that we see the offer from the top four administrators coming into play.

Superintendent James Hammond:

“If there were to be any type of salary reduction for employees, that we would double whatever that salary reduction would be. So if we are looking at a 2.5% reduction to every employee in the district, then we the four of us would incur a 5% reduction for the 09-10 school year in order to contribute to our ability to prevent layoffs.”

And let us not take away from this gesture. Because it is important to know that the administration is willing to share the pain, particularly after we have been so critical of Bruce Colby taking a pay increase of roughly 5% in these budget times. He is willing to give that back should it be needed.

As Board President told the Enterprise:

“They’ve being leaders.”

But clearly this is the worst case scenario and the last resort. However, it does appear that the administration got the message from the community that has complained about administrative raises during a year when the district was contemplating layoffs and teachers were not getting raises.

The bottom line here is that while that gesture is appreciated a lot has to go wrong for it to be implemented.

However, we are not done. The cuts in 2010-11 under current assumptions amount to $1.65 million. Remember however those are on top of the cuts that would be implemented for 09-10.

At this point we are really getting into pure personnel unless the district gets stimulus money, gifts, or categorical flexibility. Because the district is looking for a three-year balanced budget, they are looking at 8 teacher layoffs for $520,000 in savings, 12 secretarial layoffs for another half million, and the loss of nearly three site administrators for $295,000. The latter represents a 6.26% cut in funding for the unrepresented bargaining unit, compared to 4.59% for classified, and 1.59% for certificated.

Those cuts however still leave the district nearly $300,000 short of balance.

In short, the district is making a lot of tough decisions right now that they really might not have to make depending on how the budget pans out. Much of this is due to the board’s apprehension to do a self-qualification and work toward a balance for 2010-11 with more realistic assumptions.

There are going to be teacher’s noticed. That is now unavoidable. It will not be the 100 or so that were noticed last year. But as the DTA representatives said on Wednesday, that took a huge emotional and psychological toll.

As Superintendent Hammond put it:

“There could be overnoticing going on but we do not know what the rules of flexibility are going to be.”

As Board President Gina Daleiden put it:

“No one would do this unless we were at the very last resort.”

I understand some of the rationale for doing it this way, but I’m not fully convinced it is the last resort. Given the state budget picture, a self-qualification does not seem to put the district in the kind of risk they would have been in last year, they need to trust their Superintendent and Chief Budget Officer who just last week recommended the self-qualification route to avoid these kinds of drastic cuts that may not have to be implemented. I understand the frustration that Board Member Sheila Allen expressed at the state budget process, the school districts are one of many victims of that inaction. But I am not convinced this was the only way to do this based on the other alternatives out there.

—David M. Greenwald reporting

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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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6 thoughts on “Drastic Measures and Grandiose Gestures by the School District”

  1. Anonymous

    Does the Davis School Board know something that the rest of the state does not? 70 percent of the state is going to self-quality, and our two top district administrators are recommending it, but I guess our five board members know more than all of them?Sure makes a lot of sense to me.

  2. David M. Greenwald

    I'm not completely up on it. But first let me say, the district administration did not recommend self-qualification, they posed it as an alternative.Basically state law requires districts to have a budget by March 15. And not just a budget but show that they have balance for three years.If you have a balanced budget through the entire period, you are positively qualified and basically in good standing. If you are self-qualified, that means you are basically saying that you have balanced budget for two years, but you are showing a negative balance for the third year.Under normal conditions that is a red-flag to the overseeing agency, the County Office of education. Last year there was a fear that they would come in and take over our operations because it would demonstrate fiscal problems.What's changed this year is that the state situation is so bad, everyone is going to have trouble balancing their budgets for this next year let alone two years out especially given the non-budget and unknowns. So the thinking is that the county would not have the same reaction as they would have last year.I'll try to get a better explanation than that. Listen to about the 20 minute mark of the radio show, they have a far better explanation than I could muster.

  3. wdf

    Because there are potential risks involved in self-qualifying (unwanted scrutiny from officials from outside of Davis, perception of greater financial risk when taking out loans, overall perception of greater financial instability), and because DJUSD is a public, tax-funded entity, it isn't wise to ask for the self-qualifying option without fully hashing out the alternatives in public discussion.If the alternatives are so thoroughly unacceptable, the trustees can come back and revisit it, with some credit for having a fuller understanding and discussion of those alternatives.There is a point where inaction on the part of the legislature is almost more despicable than an undesirable but approved budget.Would Gray Davis have shown more leadership now than Arnold Schwarzenegger? That's not really a rhetorical comment. I honestly wonder. Regardless of the political party affiliation, the chief executive has an expected responsibility to make things work. It doesn't seem be be happening with the current governor.

  4. Anonymous

    WDF, I agree the State Legislature is bad and has been that way for more than a few years. The self serving Nunez and Perata are gone and that helps. I think Arnold has been trying to get everyone to see the light for a couple of years now. But they all have their special agenda's to follow. Gray Davis was the idiot who signed in the …Fair Share… shop agency to allow the Unions to steal public funds. Now our leaders, from top to bottom, have to deal with self serving Unions before a resolution can be reached.

  5. Rick Entrikin

    David:I love athletics and learned a lot about life & teamwork by playing sports in high school & college.But this is a different time. Now,the same DJUSD trustees who are wringing their hands over projected $1 million annual deficits are supporting a $10 million athletic stadium/track.Something is wrong here(money, values or both).

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