With slower-than-expected revenue growth and a 2.5 cents tax built into next year’s budget to pay new bond debt, Durham County officials said Tuesday that the school district’s funding request of as much as $13 million for the 2017-18 school year is out of the question.
The request for such a large amount would only be necessary if state law makers uphold a mandate that districts across the state reduce K-3 class sizes. Durham Public Schools has said that reducing K-3 class sizes could cost the district approximately $6 million, the cost of an additional 102 teachers.
“As you already know, we already have a 2.5 cents tax increase that’s built in as a result of the bond referendum we passed in November, and in addition to that, $13 million is an exceptionally big number,” explained County Manager Wendell Davis during a joint meeting between County Commissioners and the DPS Board of Education Tuesday.
Davis said a $13 million increase would require about a 3.7-cent tax increase on top of the 2.5-cent increase already built in to cover the bond debt.
He said that while new revenue topped $9 million last year, it is projected to fall to about half that this year.
“Thirteen million dollars is a large number and we have to be realistic about what we’re going to be positioned to burden taxpayers with,” Davis said.
But DPS has said the mandate will be painful if lawmakers don’t act to change it.
“If the General Assembly forces us to do that, that means we will RIF (Reduction in Force/lay off) 100 art, music and P.E. teachers,” said Superintendent Bert L’Homme.
He said DPS does not even have 100 extra classrooms to accommodate the K-3 teachers it would have to hire to replace the laid off art, music and P.E. teachers.
And L’Homme said outfitting 100 classrooms would also be an expensive venture.
The amount needed to reduce K-3 class sizes for DPS would be less if a proposal by the state House is upheld by the Senate.
Under that plan — House Bill 13 — the cost of the state mandate would be cut to one-third of the initial estimate, or roughly $2.2 million to pay for about 30 teachers.
L’Homme urged commissioners to focus on the district’s base request for new money, which amounts to nearly $5 million.
It includes a request that the county fully fund the operation of the Whitted School to the tune of $1.5 million.
DPS and the county initially agreed to split the cost to operate the new school that will have eight preschool classrooms for 144 students, but DPS said a tight budget year will make it difficult for the school district to come up with its share which amounts to $750,000.
L’Homme also asked commissioners Tuesday to place the money in a special appropriations account so DPS won’t have to share it with local charter schools as required by state law if it’s given as part of a new budget appropriation to the district.
“We’ve checked this out and charter schools would not be able to attach it if it was given as a separate appropriation,” L’Homme said.
He said a commitment to the Whitted School request is needed sooner rather than later because DPS has put off hiring staff for the school until it knows whether the county will agree to the $1.5 million request.
In addition to Whitted School, which is scheduled to open in August, L’Homme said the new money request for enrollment growth, increases in fixed costs, salary and benefit increases should be the priority for the moment.
“Those are things that are important right now,” L’Homme said.
County Commissioners Chairwoman Wendy Jacobs said she thinks the two boards are in agreement on establishing a separate funding mechanism to support preschool programs so that charter schools, which do not operate such programs, are not entitled to a cut of money earmarked for them.
Commissioners suggested sending all money for preschools through such an account.
“The money needs to go directly into a separate fund,” Jacobs said. “We need to start funding pre-K that way to make sure the money is in a separate account.”
She was less committal about the request for the county to pay the entire operational cost for Whitted.
“It’s really going to be a tough budget year for us,” Jacobs said. “Obviously that’s going to be part of our conversation, whether we are able to cover DPS’ costs for Whitted.”
Meanwhile, L’Homme said he would be reluctant to spend $2.3 million to give increase DPS’ minimum wage to $15 per hour unless the county agrees to fund it.
DPS has been asked to consider such an increase to keep pace with the county and City of Durham, which have adopted a $15 an hour minimum wage.
“If we were to give that raise to our staff without an increase, I would be reluctant to give it if we had to take more and more resources from the classroom,” L’Homme said.
DPS is facing an $8.5 million shortfall and will be forced to make “substantial” cuts to central services, the school district reported last week.
DPS Finance Director Aaron Beaulieu presented a PowerPoint presentation on Tuesday showing cuts totaling $6.5 million to central services and $4.95 million in school building reductions.
The school district will rely on $7.7 million from its fund balance to balance the budget, leaving about $2.2 million in its rainy day account.
DPS also projects a 500-student decrease in enrollment next year, which will mean a loss in state funding and about 30 teaching positions and some support and counseling positions.
Meanwhile, charter school enrollment is expected to increase by 700 students, which means more local dollars will follow students to those schools.
Beaulieu used visual aids, fake money, to show commissioners how much local funding follows students to charter schools.