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Why are local schools in red ink?

Mark Brooky • Jul 21, 2015 at 12:54 PM

Ron further asked, "Why do they feel that the state should bail them out? Could the schools not use reserve money to keep the most important educators (teachers and paraprofessionals) teaching this coming school year? Were salary increases given to any school personnel for the 2013-14 school year?"


I asked the superintendents of the Grand Haven and Spring Lake school districts to help me with the answer, and both offered extensive and passionate explanations.

Keith Konarska, superintendent for Grand Haven Area Public Schools, said the primary reason for the Grand Haven district’s "budget challenge" is the state's unprecedented $470 per-student funding reduction made the past two years, which aligns funding with pre-2005 levels.

"When this is considered, on top of the all-but-required program expansions such as all-day Young Fives and kindergarten programming, significant financial challenges were created for all districts," he said.

Dennis Furton, superintendent for Spring Lake Public Schools, had a similar response. He cited the reduced state foundation allowance, which is the district's primary source of revenue, coming at the same time that the retirement rate was increased. 

"The result was a net decrease to available funds of almost $750 per pupil," Furton explained. "That equates to more than 10 percent of our revenue from the state. On the heels of that net reduction in available funds, the state mandated all-day kindergarten, which further eroded our ability to balance the budget by reducing by half the revenue we receive from kindergarten enrollees. That equated to a $182 per-pupil reduction."

Given those factors, Furton said the SLPS staff conceded a great deal in terms of wage freezes and insurance concessions. In addition, the district has looked to share several administrative positions with neighboring districts and has privatized its custodial staff — "to name just a few of the efficiencies we've implemented."

"However, some reductions to professional and non-professional staff have been necessary," Furton added. "These reductions have been kept as minimal as possible, though it is accurate to state that reducing paraprofessional support will absolutely impact classrooms and students."

Furton said the district has balanced its budget by utilizing its fund balance. However, these reserve funds are reaching a point that they may no longer be enough to avoid borrowing at peak times during the fiscal year, he said. The school board has made it a priority that the district avoid a need to borrow.

Furton said no SLPS employees have been granted a salary increase for the 2013-14 year.

"And, finally, we are not asking for the state to 'bail us out,'" he said. "We are seeking a return to investing in public education at levels that sustain what is working. We know that our system is succeeding in its mission to educate our schoolchildren. We need the state to recognize that education is an investment."

Konarska said they do not consider a restoration of the $470 per-student funding reduction as “bailing us out.” He said a restoration of these dollars would be significant in eliminating deficit spending. 

"Grand Haven Area Public Schools has maintained the integrity of our programs by identifying efficiencies away from the classroom and expanding alternative revenue," Konarska said. "The result of these efficiencies has allowed us to put money aside each year by adding to our fund balance — in essence, reserving dollars for a rainy day. We have utilized these fund balance dollars over the past few years to balance our budget and offset funding reductions. Unfortunately, in doing so, we have spent down our fund balance to a low level."

Did the Grand Haven district have salary increases for the coming school year?

"Yes," Konarska replied. "When employee contracts for the 2013-14 school year were negotiated over a year ago, our staff agreed to significant concessions — including taking a wage reduction or freeze, contributing 20 percent toward health care premiums, and paying more toward retirement costs in exchange for a modest increase this year that is partially offset by those concessions.

"In addition, the state indicated that increased revenues would be directed towards K-12 funding," the Grand Haven superintendent continued. "Unfortunately, the expected increases in K-12 funding for the coming year did not occur as increased state revenues were, for the most part, directed toward early childhood and colleges."

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