By Jake Vela, LEV Senior Policy Analyst
How big is the budget shortfall for the 2017-18 school year?
- Seattle Public Schools (SPS) has recently announced that they have an expected budget shortfall of $74 million for the 2017-18 school year. The $74 million shortfall would be about 10% of the $790 million budget recommendation adopted by Seattle Public Schools in 2016-17.
- Why is Seattle Public Schools expecting a $74 million budget deficit in 2017-18?
- The expiring of a temporary increase in how much the state allows Seattle to raise through local levies (levy lid) accounts for $30 million of the shortfall. The other $44 million is because the staffing levels agreed to by the district and the unions in the most recent contracts exceeded the funding levels they knew would be available in the 2017-18 school year.
- Why is the state levy lid being reduced starting January 2018?
- In 2010 the legislature temporarily increased the amount of money school districts could raise through local levies (levy lid). This increase was intended to be a band aid to allow districts, who were able to pass additional levies, to make-up for the reduction in state funding for education due to the economic recession. This temporary increase is set to expire at the end of calendar year 2017 as specified in the original legislation in 2010.
- Is SPS expecting a budget deficit in 2016-17?
- Yes, the 2016-17 budget adopted by SPS expected to spend $35 million more than they anticipated to get from the federal, state, and local sources. SPS was able to do this because they spent $35 million in reserves they had remaining from previous years.
- Is this approach to budgeting by SPS sustainable?
- The Office of Superintendent of Public Instruction recommends that districts end each school year with reserves equaling at least 5% of their annual budget to be able to address unexpected changes in costs or funding support from local, state, or federal funding sources. To meet the 5% goal SPS would need to maintain a reserve of $39.5 million to remain in good financial health. According to the 2016-17 adopted budget Seattle is expected to end the School year with an ending fund balance of $39.9 million which would be just enough to meet the 5% reserve fund goal.
- How has the level of state funding changed since the beginning of the recession in 2008?
- When did Seattle Public School agree to the salary and staffing levels that created this budget deficit?
- Seattle Public Schools agreed to their most recent collective bargaining agreement in September 2015 after the state had passed their most recent budget in July 2015. The district agreed to this budget following the strike at the start of the 2015-16 school year. The recent and future salary increases and staffing levels agreed to by SPS and the unions in their 2015 Collective Bargaining Agreements set district staffing levels and salary increases through the 2017-18 school year
- How much of a school district’s budget is dedicated to staffing costs?
- Over 80% of the average school district’s budget is from staffing costs.
- What is a reduction in force (RIF) notice?
- It is the notice a district sends out to existing staff that may need to be laid off if the district will not have sufficient funds in the following school year. Receiving a RIF notice does not mean an employee will be losing their job, but it does mean they will be in a pool of employees that may be laid off.
- What determines who will receive a RIF notice?
- The district will send out RIF notices to teachers, support staff, and other staff positions based on the district’s plan to cope with the budget shortfall.
- What determines which employees do or do not receive a RIF notice?
- Who does and does not receive a RIF notice is tied to the level of experience an employee has, so teachers with less experience will be more likely to receive a RIF notice than more experienced employees. New and beginning teachers are more often found in schools with higher levels of low-income students. Teachers, staff, and students in these schools will experience more uncertainty in their school building than other schools.
- Will the budget deficit be solved before the district would need to send out RIF notices?
- The legislature is expected to invest more money in basic education in the 2017 legislative session, but a final budget isn’t expected to be completed before the district completes their budget preparations for the 2017-18 school year.
- How much does $74 million mean on a per-student basis?
- $74 million translates to a budget shortfall of $1,407 per SPS student. The state would need to increase education funding by approximately $1.5 billion for the 2017-18 school year, one-year before the court mandated deadline of 2018-19, for Washington to experience a funding increase of $1,400 per-student statewide.
- Are other districts experiencing similar budget shortfalls?
- In the future other districts may communicate to their communities that they are expecting a budget shortfall because of the levy cliff or other budgeting challenges, but as of December 15, 2016 we are not aware of other districts publically stating they expect to have a budget shortfall in the 2017-18 school year.