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School Survey: Michigan school districts still face major cuts

We aren't really inclined to post unedited media releases, but this one from the Michigan School Business Officials really lends a lot of perspective about the effect that costs rising far faster than revenues are doing to Michigan's schools. We're interested in what you think about us posting great big things like this is - send us an email or send a comment using the form at the bottom.

News Release from the Michigan School Business Officials

Schools are still cutting programs, staff and services despite an increase in their foundation allowance for the 2005-06 school year and a proposed increase for 2006-07, reveals a March 2006 survey conducted by EPICoMRA on behalf of Michigan School Business Officials (MSBO).

In the 2005-06 school year 234 Michigan school districts (a random sample of Michigan's 535 K-12 districts) stated that they eliminated 859 positions, which equates to more than 1,900 layoffs statewide. Seventy-three percent of these districts did not fill open positions or reduced staff through attrition and 82 percent spent or reduced their fund balance.

These districts still expect to face budget challenges in the 2006-07 school year. They responded that even with a projected $200 per pupil increase in the foundation allowance for the 2006-07 year:

75% will spend or reduce their fund balance

73% said they would not replace some or all of employees who leave

69% will increase workload for current employees

67% would reduce spending on supplies and services

58% would increase class size

Another startling discovery was that in the 2005-06 academic year, 60 percent of the districts reporting indicated that their pupil enrollment decreased; with an average loss of over 1,000 students per district for urban districts responding to the survey.

Besides layoffs, school districts have done a number of things to lower their expenses:

76% increased their workload for current employees

56% allowed class size to increase

45% participate in cooperative purchasing

35% reduced or eliminated field trips

Many districts are focusing on energy management strategies to lower their costs. Energy costs represent two to four percent of a district's budget. In 2004-05, the 234 responding school districts spent over $142 million on heating and power (gas, electric etc.) needs. In 2005-06 these same districts spent about $172 million, which is an increase of 21 percent from the year before.

"It appears that despite the Legislature's increase to the foundation allowance for 2005-06, and their proposed increase next year, there are still structural problems to the school funding system," said Ed Sarpolus, Vice-president of EPICoMRA. "School districts are still struggling and their cuts are impacting the classroom."

While the survey numbers tell a story, the following comments from unnamed school business managers are even more telling:

"We are looking at privatizing transportation, custodial and food service for next year as the only way left to avoid substantial reductions in educational programs."

"We will be out of fund balance at the end of 2006-2007, even with more than $800,000 in cuts for that year. We will not be able to make enough cuts to get through the 2007-2008 year. We are dealing with one year at a time, which is the best we can do considering that we're a month into the new school year before we know our enrollment and per pupil amount for sure."

"If the current trend continues, our school will have spent its fund balance within three years and be closing our doors!"

"We have closed two buildings in two years and negotiated freezes and hard dollar caps. We have no capital outlay, curriculum adoptions, and no major facilities projects taking place for three years. What else can we do?"

"All district employees and parents are pulling together to keep our doors open."

"We are implementing $2 million in budget cuts for next year. We will continue to close school buildings in fiscal 2008. We believe we offer excellent educational opportunities for children, but these opportunities are in jeopardy. We are focusing way too much energy on the budget and too little energy on the business of educating students. This continues cause organization disruption and unrest as just about every aspect of our operation is being affected by budget cuts."

"We are using choice to help deal with our financial situation - of our total students, of nearly 7,000, 16 % are choice. We would be in enrollment decline without choice."

"We have picked all of the low hanging fruit - our future is now one of choosing from a myriad of destructive actions that will have negative impacts on our students and totally change the culture of our school district."

"Community members volunteer to cover jobs we can't and parents do fundraisers to keep co-curriculars going. We started adjusting programs over four years ago, so thus far have managed to save all staff. In past four years we have attained two large federal grants and many small, local grants for extras."

"We are selling a building next year to help balance the budget. This is a one-time revenue. The following year we will not have another building to sell!"

"We have to figure it out year by year. We can't do much for long range planning."

"We had to deal with this in 2003-04 where we laid off 10% of our staff and made drastic non-payroll cuts. We had two years of no base increases. We are holding our own."

"Even though the numbers do not look big, (because) we are not a big district, only about 1400 students, we have been making reductions for so long we really do not know or have much left. With student ridership of about 80%, only two custodians per building and bare bones administrative staff ... sorry it is just extremely frustrating when you are trying to a lot of good and (you) really care."

"Not quite sure how we are going to survive. Really do not have anything left to reduce other than really increasing class size."

"Constantly asking relevancy questions. Looking at ways to cover additional support staffing needs with existing staff and formulas embedded in contracts to determine salary and benefit increases. We're holding people accountable for their individual budgets and following through with them."

"Left unaddressed, this district's structural deficit will carry into next year plus we anticipate an enrollment drop. The stars are NOT lining up."

"We continue to defer purchases for textbooks, technology, buses, and repairs on buildings and grounds. Due to cuts and deferrals made, labor costs have grown to 86% of our budget."

"We are running out of things to cut. The next step could be privatization of custodial staff and elimination of transportation for regular education students."

"Currently have our superintendent acting as the elementary principal also. Looking at privatization."

"Trying to cut costs as far away from the classroom as possible. Not large ticket items such as textbooks, computers and busses. Not replacing employees when a resignation or retirement is received."

"For the first time in many years the district is having to borrow to meet cash requirements for general fund expenditures."

For more information: Ed Sarpolus, EPICoMRA, 517.886.0860

Posted/updated Mar 30, 2006
by Andrew McFarlane (Absolute Michigan)