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NHCS's painful budget compromise: What happened, how staff are reacting, and how we got here

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District's snapshot of local funding from the county commission.

On Tuesday, June 21, 2022, the New Hanover County Board of Education members passed the district’s budget in a 5-2 vote. For some, that's a relief after weeks of stalemate — but it wasn’t the best news for classified staff.

The road to this budget had twists and turns — mainly stemming from the district’s teaching assistants (TAs) organizing in the fall of 2021 to demand a $17 dollar per hour minimum wage.

However, for now, that won’t become a reality.

Related: After a long, rocky road, New Hanover County School Board passes budget

Instead, the district intends to give classified staff, which include positions like TAs, custodians, bus drivers, and office support, a $15-hour minimum, which is state-mandated, with a 1% step increase for years of service. Prior to this, most TAs were historically earning $13 an hour. In order to fund that, the district will need to eliminate 54 positions — according to the district, this would be primarily through some combination of removing vacant positions or phasing out current positions through retirement or attrition (i.e. not replacing employees who leave or retire).

This was the recommendation of Superintendent Dr. Charles Foust and Chief Financial Officer Ashley Sutton, and the majority of the board voted in favor.

The district’s plan also includes giving classified staff a bonus of $1,000 for the next two years from the federal Elementary and Secondary Schools Emergency Relief (ESSER) funds.

In the final budget from the county, the district is receiving $91 million, a 1% decrease from last year. For capital funds, it’s $4.7 million, a 27% increase. As for the debt service, it's funding $23.2 million, which is a 6.7% decrease. The county is also providing $975,000 to expand the district’s pre-K program.

The district typically receives its remaining budget from the state (41%) and about 26% from the federal government. They also get funding from food service (3%) and capital outlay (3%), and other restricted funds (3%).

The twists and turns of the vote

Board member Nelson Beaulieu said toward the beginning of the meeting, “this budget was a loss — a loss for the board for the failure to communicate.”

Board member Judy Justice retorted by saying that classified staff wasn’t communicated with – that the discussion went from giving them $17 an hour to $16 to $15.

She claimed that the need for this increase was not effectively expressed by the district — that Foust and his staff did not provide the commissioners with accurate information about the number of positions the district needed.

“We have failed to communicate to the county commissioners how dire our situation is,” said Justice.

Board member Stephanie Walker agreed and started calling into question the district’s 1-to-1 plan where every student in the district will receive an electronic device over five years. She asked if the district could put next year’s rollout (year three of the plan) on hold. The funding for the plan comes from ESSER, a sum worth over ten million each subsequent year. She also mentioned that not all students in the district need a device at school.

That’s when Chair Stephanie Kraybill called up Dawn Brinson, Assistant Superintendent for Technology and Digital Learning, to say that all students needed to be on the same operating system — with the same software programs, assessments, and other resources. Brinson added that for security purposes, it would be unwise for students to bring their own devices into the district’s network.

Foust said during the meeting that if they delayed the 1-to-1 plan — they would have to submit to the state an entirely new plan for these ESSER funds.

“People are more important than devices,” said Justice.

Member Stefanie Adams weighed in on the issue and said that the board was “not an easy group to work with.”

“We should have been 1-to-1 years ago. We are trying to provide a top-tier education for our students – our students need to be working with these devices; we are a fintech (financial technology) hub. I don’t want to lose positions. I want people to get a raise, but it’s a workforce development issue,” said Adams.

After further deliberation from Justice, board member Pete Wildeboer, and Walker about the 1-to-1 plan, and the issues surrounding the number of positions the district needed to operate, Adams said, “I am jumping out of my skin with these questions. They are the experts. We have seen this budget for a long time, and I would make the motion to pass the budget now.”

Wildeboer followed Adams by saying he wanted to know exactly which positions would be cut in order to give classified staff a 1% step increase.

Beaulieu responded, “We are not managers, and this is bordering on absurdity; it’s time to do our jobs.”

Walker told Beaulieu and her fellow board members that the “buck stops with us. There is a potential crisis with our employees. I have worked on this budget for months, and I don’t appreciate the ‘jumping out the skin comment’. I need to ask questions freely as a board member; there are serious consequences of this budget. We need to calm down, and we are working very hard.”

Justice said that the district needed to “treat classified staff with respect. I’m worried about people leaving in droves. We need to try. We need to try to do the $17.”

She stopped giving her statement to address “Adams’ laughing” at her.

Kraybill told the members that there’s a difference between ‘oversight’ and ‘overstepping’.

“District staff have given us a recommendation; it’s their job to do that. It’s not up to us to decide that we don’t like a position,” said Kraybill.

But Justice responded, “Oversight is our job.”

Kraybill then called for the first vote to pass the budget. It was 4-3, with Board Member Hugh McManus, Wildeboer, Justice, and Walker agreeing that they needed more time to review the budget to understand if there was another way to give the pay increase or to ensure they weren’t any job cuts as a result of the offering of the 1% step increase with the $15 minimum.

Kraybill then asked those four members to vote on specific recommendations for the staff to look into.

Adams then said, “This board is an absolute disgrace.”

Walker responded to Adams, “I don’t want to hear those comments on the dais. Giggling (directed at Adams) is immature.”

Justice called for another joint meeting between the board and the county commissioners – that the district had already passed a resolution to keep the school system operating on the 2021-2022 budget until their decision, that way the board could continue to take their time on the process.

Wildeboer chimed in to say he wanted the district to reassess the possibility of providing a $16 an hour minimum for all classified staff.

He also took issue with not knowing which 54 positions would be cut over the next two years, which the superintendent had suggested was necessary in order to achieve a $15 an hour minimum, with a 1% step increase for years of service.

McManus ultimately agreed with Wildeboer about the lack of information surrounding the reductions in positions.

But Foust assured Wildeboer and McManus that the district would lose those positions through vacancies and attrition — and cuts would likely not be necessary.

Walker then brought up the need for using ESSER, the federal Covid funding for the classified staff pay increase, arguing that they needed to cut some of the ESSER-funded programs and the 1-to-1 to make it happen.

But the district said that they would have to ultimately cut more jobs if they used ESSER for the pay increase, which goes away in the next two school years.

Foust said, “We would have to take it back to the last plan and cut 230 positions – and ESSER dollars are going to end.”

Sutton reiterated that even if classified staff was given the raise over the next two years – there is no way to sustain it past that timeframe, and there hadn’t been a consistent funding stream identified.

“If you give someone a raise, that person would expect that to continue into the future,” said Sutton.

After this discussion, the board then took a short break.

Upon the board's return, McManus changed his tune, saying the commissioners wouldn’t likely give them any additional funding and the school board would have to work things out themselves: “I am so tired of the bickering. We attack each other. The county commissioners are not going to give us more money. They have spoken. They’d have to eat a lot to come back to us. Hopefully, if we all agree, the numbers are workable.”

After McManus’s speech, Wildeboer decided to change his vote, too.

After the decision, Justice said, “We’re letting the classified staff down, a lot of people are going to leave."

NHCAE President-Elect Responds

Cynthia Silva is the New Hanover County Association of Educators (NHCAE) president-elect. She starts her leadership position on July 1. She’s also been an exceptional children (EC) teacher with the district for over twenty years.

Silva said the budget decision is not good for classified staff: “They will not be provided a living wage, because to have two board members back down and went to what the state is now saying is the minimum wage, which is $15.”

She said members are contacting her now saying they are frustrated with last night’s decision, and they’re now looking at organizing around the midterm election.

“The budget can be amended, as was discussed last night, and we will be looking for Board of Education members in November that would look at what is best for the students is keeping the same staff with them not having people quit because they have to go to another job in order to survive," she said.

Silva wasn’t convinced that the county commissioners, along with some of the school board members, looked at all the funding available to them.

“But people have locked into what the superintendent has said, and we're not looking at all the different pots, and being creative, as teachers are always asked to do, as TAs are always asked to do, as custodians do. So it is absolutely frustrating when you don’t see them being creative,” said Silva.

Silva said she wants the board to be proactive in going after the $1.25 billion private endowment funding from the sale of New Hanover Regional Medical Center — and the commissioners to consider a supermajority to access some of $300 million in the county’s stabilization fund. However, Commission Chair Julia Olson-Boseman and County Manager Chris Coudriet said they would not be using any of that fund for district staff pay increases.

She also addressed the diminished funds given by the commission, which was $1.1 million less than the previous school year.

“I don't think the county commissioners fully understand how much we, the Board of Education does, need. I mean, they made a 1% cut to the budget, which was on one of the slides last night. That’s significant,” said Silva.

But she did say that classified staff needed those $1,000 ESSER bonuses the district plans to provide, but it’s still not the “permanent salary increase that would improve my life.”

She added that the district’s efforts to survey staff and the salary compensation study were all for naught.

“They wasted that money, wasted our time,” said Silva

Even though Silva is staying, another one of NHCAE’s leaders has left. Treasurer-Elect Christine Miranda Ambriz, a district exceptional children (EC) teaching assistant who’s bilingual, formally resigned for a better-paying job. She got offered a full-time position with benefits at Easterseals.

“I had this gut feeling that if I missed this opportunity, I'm going to shoot myself in the foot because I can’t let this opportunity go by, and I could be climbing out of debt rather than digging myself into debt,” said Miranda Ambriz.

Miranda Ambriz said she sent in her resignation right after the county commission made its decision not to allocate the funding for the classified staff increase.

“They’re not going to give us this raise. I’m gone,” said Miranda Ambriz.

Back in April, Miranda Ambriz told WHQR she, along with many other TAs, would leave if the commission and the board didn’t find a way to appropriate the $17.6 million for a $16 an hour minimum with a 2% increase all within one year.

“And I'm the type of person when I say something, I do it. I'm going to miss Ashley High School and working with all the students every day. It was really hard to make the move, but I had to do what was healthy for me because working three jobs was extremely hard,” said Miranda Ambriz.

The history of the TAs' ask

At the board meetings in both November and December 2021, NHCS TAs were asking to be compensated at $17 an hour at both press conferences hosted by the New Hanover County Association of Educators and during the ‘Call to the Audience’ period.

The result of these efforts had board members like Hugh McManus, Pete Wildeboer, Judy Justice, and Stephanie Walker start formally asking the New Hanover County Commissioners to provide for this pay increase.

When it came time for budget deliberations starting in early April 2022, the county commissioners, who appropriate about 24% of the system’s funding, said they would be holding the per-student spending constant at $3,434. This signaled to the school board that they would not be getting a local supplement increase for the TAs and other classified staff pay raises.

But at the April 19, 2022 school board meeting, the board voted 6 to 1 to send to the commissioners a request of $16 an hour with a 2% step increase (steps refer to years of service) over a two-year span, a total worth $17.6 million. Justice was the lone dissenting member because she wanted to give classified staff $17 an hour with a 1% step all in one year, an ask worth $14 million.

The majority board request for the $16 an hour with a 2% step increase stemmed from the district’s salary compensation study, conducted by the consultant, Hurd, Isenhour, Lopes, LLC.

When WHQR asked the incoming leaders of the NHCAE about this April board vote, they said they agreed with the board asking for the $16 an hour minimum with a 2% step increase. But they wanted it done all within one year, which differed from the official board's ask for the increase to be completed over two years, in which some classified staff would have to wait until year two to receive the raise.

NHCAE leadership said if this pay increase was not approved, then the district would start to see valuable staff leave.

At this point, NHCAE — along with Walker and Justice — was also arguing that county staff was going to receive a minimum of $16 an hour in their budget, so why not extend this same increase to the schools? And the county did ultimately end up passing its budget to this increase.

According to Jessica Loeper, Chief Communications Officer for New Hanover County, “the county increased the minimum, midpoint, and maximum salaries in our salary plan by 6.86%. This results in a living wage minimum of $16.35 per hour/$34,008 per year (based on 2,080 standard annual work hours) for any county employee.” 

NHCAE, along with several other TAs who demonstrated about the pay increase in fall 2021, said the district needed to allocate federal pandemic funds or ESSER funds to cover the pay increases, but Kraybill, along with Foust, said that those funds had already been directed for other programs and temporary job positions.

But at the board’s next meeting on May 3, Foust had changed his tune and said in order to fund the pay increases for classified staff, the district would have to redirect ESSER funding — and cut hundreds of positions.

He also said he had to take the position of the Equity, Diversity, and Inclusion Officer, a new position that was recommended by the August 2021 Equity Audit, conducted by Sophic Solutions. But members, in particular, Vice-Chair Walker, said that needed to be accounted for in the budget.

After this May budget discussion, having already shown the board what cuts the district would have to make in order to give the classified pay increase, Foust asked the board what their final request for the commissioners would be: $17-hour minimum wage with a 1% step increase, a $16 minimum with a 1% step, or $16 with a 2% step increase.

The members then tabled the final ask to the commissioners for a meeting on May 6. They also told Foust to put back in the request for an EDI Officer.

That Friday, May 6 members voted 4 to 2 to formally submit to the commissioners the ask for $17 an hour with a 1% increase for classified staff. Nelson Beaulieu and Kraybill dissented (and Stefanie Adams was not present for the vote).

At this meeting, Foust and Sutton presented they would have to cut around 230 district positions over the next three years to make the $17 an hour pay increase, with a 1% step increase for classified staff.

Sutton also said the county informed them they could not base a budget over a span of two years — they could only bring a budget based on one year alone, that there could not be a resolution passed to ensure the district’s funding for several years to come.

And after this meeting, the county commissioners' final budget held steadfast to the number they gave the district back in April: $3,434 per student, with no further allocation for the pay increase.

So then at the board's next meeting on June 7, Foust and Sutton said they could not recommend the classified staff pay the board had requested. Without the support of the commissioners, the district could not sustain the pay increase on its own, as ESSER funding would run out by the fiscal year 2025.

What’s Next?

Foust told the board they could revisit the district's budget once the state passes theirs, possibly later this summer or fall and/or if they exceed the number of students they’ve budgeted for (since funding is often based on a per-student rate).

He said with this new knowledge, “We could give an increase in October.”

As of now, the county commission gave the district money based on having 24,841 students show up to its schools, but the state projected 25,777 students, 330 more than the district’s own projection.

Foust and the board members discussed the possibility of asking the commissioners for more funding if they've exceeded the 24,841 student number after the 10-day period when the district’s enrollment count is official.

The next board meeting is scheduled for July 12. They’ll hold a town hall meeting on July 19.