Budget Letter to the School Board

Below is my Budget Letter to the School Board, which outlines the FY 2017-18 Budget:
Dear Mr. Blackmon, Members of the Board of School Trustees, and Citizens of Kershaw County:
With this document I present the Preliminary General Fund Budget for the Kershaw County School District for Fiscal Year 2017-2018. As presented, the Preliminary Budget totals $81,288,940 or a 3.1% increase as compared to the Fiscal Year 2016-17 Budget of $78,812,089. Over 60% of this increase is for pension and insurance costs.
In developing a Preliminary Budget, we have actively involved the people most impacted by the choices that are ultimately made. Beginning in February, senior staff met with every individual building principal to discuss needs and priorities. Similar discussions were held with district office administrators. These meetings were especially beneficial to me in terms of assessing where we stand. Beyond these meetings, I received input from Teacher Cabinet, Support Cabinet, Parent Cabinet, and Student Cabinet. We also surveyed principals as to budget priorities and to receive input as to the most pressing professional development needs.
Factors Impacting the Preliminary Budget
The Preliminary Budget is predicated on an enrollment of 10,424 K-12 students, an increase of approximately 100 students over the 2016-17 school year. I would note that enrollment in the current year has exceeded projection and has not decreased at the level it normally does over the course of the school year. However, I believe it prudent to project enrollment conservatively at this point in time and adjust as additional data becomes available.
As I discussed with the Board a few weeks back, the demands of growth are more complex than they might have been even a few years ago. As our enrollment has grown, the new students have brought significantly higher needs, especially in terms of special education, health impairments, and second language instruction. The percentage of our students who are economically disadvantaged has also grown. All of this is exacerbated by new and existing state and federal mandates, which are all too often unfunded, or at best, underfunded.
The South Carolina House of Representatives recently passed a budget that only increased Base Student Cost by $50. The budget under consideration by the Senate assumes an $85 increase. Even based on the Senate proposal, funding for Base Student Cost would still be $549 below the legal requirement. As we have discussed, Kershaw County School District has lost almost $70 million since 2009 because of the state’s failure to fund K-12 education consistent with the requirements of law. The $85 Senate proposal will increase this gap by another $4.6 million. The Preliminary Budget assumes state funding based on the proposed Senate budget.
Our district continues to struggle with resources that were lost during the economic downturn and have not yet been restored. We also continue to lose ground in terms of competitive compensation with neighboring districts. (For example, the starting teacher salary in Richland 2 is about $3,000 higher than in Kershaw County and the starting teacher salary in Lancaster County is about $1,100 higher than ours.) This is particularly troubling because it is projected that over 40% of the teaching force in South Carolina will retire over the next ten years. The competition to replace these teachers will be stiff. We will certainly need to be much better positioned than we are now.
The Preliminary Budget assumes no increase in local millage because any increase in millage must be approved by County Council. Under state law, the School Board is eligible to receive a 3.5 mill (about $420,000) increase in 2017-18. The Board may wish to consider requesting Council to reinstitute a revenue agreement that funds the costs of enrollment growth. The development that is bringing us new students is approved at the County level. The School Board has been put in the difficult position of having to manage this growth with no say in the matter and without adequate resources. There comes a point in time where growth can’t simply be “absorbed.” It should be noted that the District has lost over $8.8 million in local funding since 2010 because millage has not been increased to the legally permissible level.
Priority Needs
There are numerous priorities in our district that need to be met, especially because of the deep cuts made during the economic downturn. Unfortunately, available revenue does not come close to supporting all of the critical priorities. Based on discussions with the Board, staff, parents, and community members, the following areas have emerged as the highest priority areas:
• Competitive compensation, including National Board stipends
• Maintaining current class size and other services given enrollment growth
• Providing staff and materials for individualized remediation and intervention for students struggling in reading and math
• Addressing increasing needs in special education and second language (ESOL) instruction
• Hiring an additional elementary principal in the North Central area and providing additional administrative support in our fastest growing schools in the Lugoff and Elgin areas
• Expanding arts and STEM opportunities
• Providing an alternative program for elementary students
I would also remind the Board that County Council would like the District to continue to increase its financial commitment for school resource officers.
Proposed Expenditures
The Preliminary Budget does include the following:
• Teaching positions to maintain current class size and to meet projected needs in Special Education
• Step increase for all employees
• An additional elementary principal for the North Central area so that a principal will not have to be shared between Bethune and Mt. Pisgah
• Increases in line items for energy, custodial services, and library books
I am further recommending that $100,000 of Fund Balance be used to purchase math and reading materials for intervention and remediation. I will possibly bring back recommendations later as to the use of fund balance for selected deferred maintenance needs. However, I would like to wait until work on the construction projects being funded through the referendum is a bit further along.
Unmet Priorities
Following are areas that because of funding limitations could not be included in the Preliminary Budget and would be the areas I would most want to address if additional funds became available:
• Staffing to provide additional, more individual help for students who are struggling with reading and math
• Additional staffing for ESOL (second language) instruction
• Staffing for increased elective offerings in the arts and STEM
• Additional administrative support for the growing schools in the Lugoff and Elgin areas
• Funding for an alternative program for elementary students
• Funding to assume the costs of an additional school resource officer, per the County’s request
While there are certainly other areas of legitimate need, these are the ones that I see as most important in terms of our educational mission.
Budget Meetings
The following meetings have been scheduled for staff and the community to discuss and react to the Preliminary Budget:
• Wednesday, April 19 at Lugoff-Elgin High School (Staff at 3:30 p.m./Public at 7:00 p.m.)
• Tuesday, April 25 at Camden High School (Staff at 3:30 p.m./Public at 7:00 p.m.)
• Wednesday, April 26 at North Central High School (Staff at 3:30 p.m./Public at 7:00 p.m.)
Feedback from these meetings will be presented to the Board to consider as it finalizes its budget.
Although our District continues to do outstanding work with available resources, the budget I am presenting you at this point is totally and completely inadequate in terms of meeting the educational needs of our community. I can only hope that as new state revenue projections are made and the South Carolina Senate takes up the budget, the situation might improve. However, right now, the state is balancing its budget and solving longstanding problems with the retirement system, roads, and other areas on the backs of teachers and children. I also must continue to emphasize that local revenue is insufficient to meet the increasing demands of continuing enrollment growth. I think it is fair to say that we are at a tipping point.
Dr. Frank E. Morgan