The board approved an additional $5.5 million in funding from the county commission. They reserved $2.3 million to fund attrition (meaning they keep an employee’s salary and benefits in place for one year if they take a lower-paying job – and to continue paying staff that have not yet resigned or retired). They will use the remaining $3.2 million for the board’s priorities, which are preserving the positions of exceptional children (EC) teachers and EC teacher’s assistants and academically and intellectually gifted teacher (AIG) positions.
$20 million shortfall makes for complicated budget process
Earlier in the year, the district announced a $20 million budget shortfall caused by the loss of $10 million in federal COVID relief funding and $10 million in declining fund balance—mainly stemming from declining student enrollments and the increased costs for state-mandated salary raises, benefits, and retirement. That set the school board up for a contentious budget season and tough decisions on eliminating essential staff positions, like social workers, teachers, and teachers’ assistants.
Assistant Superintendent Dr. Christopher Barnes told the board that so far, in terms of positions previously set for possible elimination, the district has 98 ‘active’ positions, ones that have an employee in it or need to be filled by the first day of school. 138 ‘inactive’ positions are vacant and have been eliminated, and 62 ‘frozen’ positions are “on hold and may become active or inactive based on factors such as enrollment and budget.” (*You can view the details of these positions at the end of this report.)
He added that “Vacancies are about positions, not people.”
The school’s budget is $325 million, with $309 million in operating funds. Chief Financial Officer Ashley Sutton said the only budget not based on estimates is from the county commission, at $93.3 million. State ($193.2 million) and federal ($14.7 million) budgets are based on projections —those budgets are expected to arrive in October. The district has $7.3 million budgeted from ‘other restricted’ revenue funds, such as fines and forfeitures. They’ll only have $2 million for capital, a bulk of which is going to New Hanover High, and $14.2 million in enterprise funds.
School board continues to call out county commission
Board Chair Pete Wildeboer also announced that while they passed a budget, he will still try to contact the county commission to set up a joint meeting about the district’s finances.
At the beginning of the meeting, Wildeboer and Board member Hugh McManus stressed that the commissioners refused to meet with the school board to discuss this year's complicated budget.
McManus said he still wanted to entertain the idea of forcing the commissioners to the negotiating table on the budget through a provision in state statute.
“It’s do or die in the next decade for [public schools] – they owe us something – and to hear us out,” he said.
Members Josie Barnhart, Stephanie Kraybill, and Pat Bradford said it was too late in this cycle to request additional funds from the commission because they needed to pass a budget soon to make payroll.
At one point, Sutton interjected to tell them that the district wouldn’t run out of money to pay staff on July 1—but that it would eventually if a budget wasn’t agreed upon. Board members concluded they would need to pass a budget without going back to the county to ask for more but wouldn’t give up on communicating the district’s needs to them.
Budget pressures
Superintendent Dr. Charles Foust reiterated that salaries, benefits, and retirement costs continue to increase – and that the newest state budget “makes [him] nervous”: what if the legislature passes a 5% salary increase when the district has budgeted only for 4%?
“We’ll have to come back to you all if that happens,” he said.
School boards across the state have struggled with the same problem this year: sunsetting federal funds and mandated pay raises have squeezed their budgets into a crisis. Diminishing enrollment in traditional public schools has similarly put added stress on districts.
If a district position is within the state allotment, the state budget pays for it. If the position is over that allotment, the district/county commission is on the hook for providing the increase, hence the reason for budgeting conservatively.
McManus pointed out that $7.2 million is going to charter and virtual schools, which is out of the schools’ budget. “This doesn’t help our schools, and it’s going to get worse,” he said.
Barnhart responded that they have to provide for students no longer attending public school, and the local money follows them. Barnhart also suggested reducing the teachers’ local supplement by 10% if it would mean they could save more positions.
Endowment announces additional funding
Bradford mentioned that the district will receive an additional $2.9 million from the New Hanover Community Endowment to hire 26 literacy facilitators, which was announced the day before. They’ll receive $5.9 million over the next two years, for a total of $8.7 million over the life of the grant.
It’s unclear what will happen to those positions after the close of the three-year grant.
In a press release, the Endowment said this grant will add two pre-K classrooms, providing two additional teachers and two teacher’s assistants to serve up to 30 additional families. Earlier in the week, the public was notified that the district lost $3 million in funding from the federal Head Start grant program, which supported the operations of Johnson Pre-K.
The next meeting is scheduled for Tuesday, July 2, where the board will discuss policies 7300 and 3200, which regulate what staff can have in classrooms.
June 27, 2024 - NHCS Budget Draft by Ben Schachtman on Scribd
