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Schools

Schools to cut budget $19.6M

The superintendent says raiding the reserves again is not an option, but reducing the staff is.

By THOMAS C. TOBIN
Published January 11, 2006

The Pinellas school system will cut its budget by nearly $20-million next year, bringing lean times that will feature slim raises and fewer employees, district officials said Tuesday.

The details will become apparent over the next two weeks as top administrators prepare a list of cuts for the School Board to consider.

School superintendent Clayton Wilcox told the board a fiscal problem has been brewing for years, the result of officials failing to make "the hard decisions" as revenue from the state did not meet the district's education needs.

"This is not a result of last year's budget," Wilcox told the board. "This is the result of many years of spending decisions that have been made. . . . We simply don't have the luxury anymore to do what amounts to deficit spending."

He spoke of "right-sizing" the district's staff.

"I think we're looking at a year ahead where fewer of us will have to run a little harder and a little faster," he said.

School Board members accepted the news glumly.

"Here we are again - looking at cutting for the kids," said board member Jane Gallucci, who blamed state policymakers.

Wilcox said he and his staff have been combing the budget for potential cuts. None of the scenarios so far call for layoffs, but he indicated plans could include multiple transfers and not filling vacancies.

Also on the cutting table: a range of unspecified programs.

Wilcox and district finance officials predicted schools would feel a significant impact.

According to projections released Tuesday, the district is planning a cut of $19.6-million for the 2006-07 fiscal year, which begins July 1. That's up from an $18-million figure Wilcox announced in November.

As it stands, the 2006-07 budget would include minimal raises. Teachers who have not hit the top of the salary scale would get a "step increase" of 1.5 percent. All other employees would get a 1 percent raise. The district would continue to pay 80 percent of the district's health insurance contribution. But Wilcox suggested that the board might want to look at reducing even that long-standing benefit.

"We're trying to look at everything," he said. "There's just not an area that we are not looking at."

Pinellas teachers got an average raise of 6.6 percent last year after voters approved a property tax increase to bring teacher salaries closer to the national average. Their salaries are higher this year than they would otherwise be, but they remain below the national average.

Pinellas gets an increased allotment from the state each year, but it has not been enough in recent years to keep pace with expenses and maintain the reserves needed for unanticipated costs. This year, the state funding formula will give Pinellas about $779-million in operating funds but the district projects expenses of $802-million.

The shortage has been an annual occurrence, which the district typically handles by raiding its reserves and transferring money within the budget.

But the district's budget officials predict disaster in just four years if that practice continues. Assuming the state's funding philosophy remains the same and the district did not cut its budget, the district's reserve account would be more than $56-million in the red.

Budget officials call that "the Titanic model."

Said Doug Forth, an assistant superintendent in charge of budgeting: "The results are unacceptable, financially and legally."

The district cut its budget by $18.5-million in 2003, which improved its reserves in 2004. But they have started to decline again.

The $19.6-million cut next year would give Pinellas a reserve of about $22-million by 2009, district officials said.

"We're not running out there saying, "The sky is falling," but we're looking for practical solutions to improve our position," Wilcox said.

He told the board that schools and departments would not be involved in fashioning the final list of cuts for the board because they do not have an overall view of the district's budget situation. He also said they were not likely to cut their own budgets very effectively.

Recently, when the district asked departments to submit their budgets for 2006-07, some came back asking for more money and staff, he said.

"We were like, "Didn't you get the memo?' "

Among the factors contributing to the district's fiscal woes:

Rising energy costs.

Rising insurance costs.

The class size amendment, which will require more teachers.

The choice plan, which requires more buses, drivers and fuel.

Potential settlement costs for a handful of serious legal claims against the district, including lawsuits from the families of two students killed in bus-related accidents.

[Last modified January 11, 2006, 00:40:10]