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School programs and employees may have to go
By MIKE HALLIDAY
While state legislators are congratulating themselves for putting more money toward education, Federal Way Public Schools is facing a $4.2 million shortfall next year that could mean making painful decisions that could include cutting programs and employees.
While the specific programs havent been brought up, that could change in about three weeks when an advisory committee to the School Board presents a more refined list of possible options, said Sally McLean, the school districts chief financial officer.
Board member Charles Hoff said the districts financial predicament will mean whole programs will get cut rather than taking a few dollars from one and a few from another.
And it will mean reducing the number of employees on the districts payroll, McLean said. Whether thats through teachers leaving for other work, retirements or the district handing out pink slips, its too soon to say, she added.
Those decisions will have to be made before the end of May, before teachers renew contracts for the next academic year.
A budget committee of citizens and district employees is working on budget recommendations for superintendent Tom Murphy. A preliminary recommendation will be made May 9.
McLean explained to the board this week why the shortfall is anticipated, despite an increase in state money to school districts. The problem comes from four areas:
Increased funding for teachers salaries and benefits.
Â Federal Ways financial reserves, or rainy-day funds.
Low birth rates in the district.
Cuts in federal funding.
When the state increased funding for teachers salaries and benefits during the last legislative session, not only was it almost double what the district anticipated when this years budget was created, but it paid for half of the districts educators. In almost 20 years working on school budgets, McLean said she had never seen something like this during the second year of the states budget.
Using formulas, the state determines how many teachers a district should have and pays for those positions. But if a district wants to add more teachers, for example, to lower class sizes, run special programs not required by the state or pay for counselors and librarians, the district must find the dollars to pay for those positions. Typically, the money comes from levies the districts voters approve.
An increase in revenue of $1.4 billion at the state level had legislators in Olympia looking around for places to spend some of the money, which included salaries and benefits for teachers. Across the state, teachers will get a 3.3 percent cost-of-living increase, benefits and pension contributions. That means the district has to come up with $3.8 million to cover the teachers it hired with levy dollars. And its not something the district can blow off. Court rulings require all educators receive pay increases. Those court rulings dont detail who writes the checks.
Saving for the unexpected
Part of the districts budget between 3 and 5 percent is kept aside in the general fund. In laymans terms, its something of a rainy-day fund. It pays for unexpected expenses not foreseen during budget planning, or helps cover costs temporarily while the district waits for income from one of its revenue sources.
In the last few years, the district has dipped into this reserve to cover some its budget shortfall to keep programs operating and staff paid. The School Board has mandated there not be less than 3 percent. But now there is. In the 2004-05 school budget, the board allowed the district to go below 3 percent. The district had never needed to do that, and the unreserved funds remained at 3 percent. Theres a first time for everything, and that year was it. To bring the districts unreserved funds back to 3 percent means the district needs to put back $840,000.
Fewer kids means less from state
Then there is the declining birth rate in the Federal Way district. While not every child born in the district necessarily becomes a student here, the rate is used as a barometer of future class sizes. The birth rate fell from 2,017 in 1992 to 1,672 in 2003, and kindergarten enrollment declined to about 80 percent of what it has been, officials said.
The number of students in the district determines how much funding comes from the state. In the 2003-04 school year, the district saw a one-year drop in enrollment and a state budget crunch that resulted in a $6.4 million cut in the districts budget.
McLean acknowledged there are other indicators things arent so gloomy. For instance, construction is strong in King County and could mean more people will move to the district with school-age children. However, construction alone wont offset the lower birth rates for most schools.
Cuts from the other Washington
Federal funding for programs the school district uses are being cut. The total dollar amount seems paltry an estimated $165,000 compared to the millions the district is bracing to go without. Yet, McLean said while there will be fewer federal funds, the programs will survive, but with reductions. And the district has previously taken the stance it wont buttress federal programs with local dollars.
Add to the situation the district is considering new academic programs for next year that require money.
The state also gave districts money to pay for summer programs and extra help for students not passing the Washington Assessment of Student Learning (WASL) about $469,000 for Federal Way. However, the Legislature told districts they cant substitute the new money for local dollars already paying for the WASL classes.
Aside from the Seattle school district, which is considering closing schools because of plunging enrollment, other districts in the area arent feeling Federal Ways pain for three reasons:
Other districts have larger budget reserves. Murphy noted his district spent part of its reserve to help students succeed academically and is the only district in the South Sound region to achieve the desired yearly progress in each category measured by the federal No Child Left Behind act.
Other districts, like Bethel and Puyallup in Pierce County, are growing rapidly and getting more state funding as a result.
Other districts recently passed local maintenance and operation levies that take advantage of new state legislation allowing them to collect more from taxpayers. Federal Way wont be able to do that until 2008, when its current levy sunsets.
Staff writer Mike Halliday: 925-5565, firstname.lastname@example.org