The Tough Work Now Begins

Unfortunately a good chunk of the remainder of the school year will be devoted to trying to solve our current budget mess, and this process kicked off in earnest with a Board study session we had on Tuesday, Janaury 26th. With the recently proposed State budget, our friends in Sacramento whacked education again. For us, the latest estimate is a further decrease in revenue of about $700,000. This was on top of the $900,000 we already knew we’d be in the hole for next year. Furthermore, these estmates already take into account the recent mid-year reductions we made (as I wrote in early December, we eliminated five positions at the District office — almost 20% of the District office staff — and for four of those folks, their last day was yesterday).

That leaves us with a known problem of $1.6 million. However, as we have learned, the situation is more likely to get worse and not better, so our staff estimates that it would be more prudent to look at it as a $2.2 million problem — a combination of revenue enhancements and cost reductions equaling that amount starting next fiscal year would eliminate our deficit and keep us above the 3% minimum required reserve level. However, only a 3% reserve level hardly gives me great comfort (we were at 14% only three years ago, so it’s easy to see how the State can wipe that away quickly). Also, this assumes that we renew the Measure D parcel tax, which expires June 2011. We need to have another discussion on when to put this renewal on the ballot — definitely look out for that!

By the way, if you didn’t catch that, I did say “revenue enhancements.” I’m very excited to report that Dr. Baker and his team are aggressively pursuing ways to increase our top line, including more aggressive grant proposals as well as looking at launching some fee-for-service businesses, such as pre-school, after care, and summer camps. It’s a brilliant idea, and long overdue (although SCCLC has had a model for some years). Like any new business, we must remain conservative as to its possibilities for the purpose of budgeting, but I do agree with our Superintendent that it has tremoundous potential. Accordingly, the Board agreed that a target of around $250K in next fiscal year is prudent for the purpose of budgeting.

That leaves us with the cuts. At our Board meeting Tuesday night, the Superintendent presented what was essentially a discussion piece developed by the Admininstration to look at restructuring the way we deliver some programs. Unlike in the past when we considered eliminating certain programs, these ideas were more about sharing responsibilities and/or reducing services rather than eliminating them. Of course, such reductions would still involve reducing personnel (as that’s where the savings lie), but they are definitely more creative solutions that would lessen the impact on the students. Some of these ideas include reducing library support, using middle school music instructors to also teach elementary school stuents, etc. These are all just concepts at this point — the Board will of course debate these and other ideas over the next few months. However, the Board did generally agree that the target for these types of programatic restructuring cuts would be about $750K. So, with $250K in revenue enhancements, that leaves us with a target of about $1.2 million in reductions that would need to come from employee compensation. Generally speaking that can happen two ways (or a combination of the two) — reductions in the average compensation per employee, or a reduction in the number of employees. The former means things like salary cuts; the latter means things like increasing class sizes (and both areas are matters that need to be collectively bargained).

This bring me to process. How are we going to approach this problem and discussion, as well as get input from the public? Unlike last year where we did a few large “town hall” style meetings, it is more likely that the Superintendent will conduct a series of smaller, school-site meetings at every school to discuss these issues with parents and concerned community members and bring back that input to the Board. Please be on the lookout for notices from your principals on these meeting days and times. Also, we still have the budget survey from last year, and that will continue to be a resource for staff and the Board. Many of you may recall from last year that we have a March 15th deadline for sending out “pink slips” to certificated employees. So, for example, if we think that increasing class sizes is at all a possibility, then the District would have to send out notices to potentially affected teachers. It’s of course a wacky system as the budget isn’t completed until June (and like last year, you can then rescind the termination notices – but of course affected employees have already started looking for other jobs by then), so you have to make a decision by March 15th to send out these notices based on a ton of uncertainty.

So, if you’re seriously depressed by the time you’ve read this far, I do want to add some perspective. Yes, the State is treating us like crap. Yes, the ramifications for California are potentially catastropic. Yes, the structural problems in the state render it unlikely that this will turn around for very long time. But we in San Carlos have an amazing history of making lemonade from lemons. We still have great schools by every measure, dedicated and inspiring teachers, a top-notch administration and staff, and passionate and devoted parents. Although it may be cold comfort to some, San Carlos has it much better than so many other places in the State, including some our close neighbors (e.g., Redwood City is facing some unfathomable reductions in their programs). This is due largely to the fact that, despite being a Revenue Limit district, San Carlos kept a large financial reserve, got the community support to pass two parcel taxes, and has a strong and growing Education Foundation. I encourage everyone to attend these budget meetings and to continue to support the San Carlos Educational Foundation, which I know is tough in these times. Also please attend Spring Fling on March 6th when we can together celebrate all that we have accomplished as a community despite the lemons that the State delivers to us.