Near Death of a District: The Perfect Storm

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Near Death of a District The Perfect Storm

• School District of Florence County
• Jan Dooley, District Administrator
• Rural Advisory Council Presentation
• January 12, 2006

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The Perfect Storm
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The Beginning

• The Perfect Storm began to brew in the late
  1980s.
• Post employment health insurance benefits were
  added to teacher contract.
• This benefit was a cost saving measure at the
  time and was an incentive to move higher-cost
  teachers into retirement and obtain lower cost,
  newly educated teachers.

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Increasing Momentum in Early 1990s

• The storm picked up momentum in the early 1990s
  when revenue caps went into effect.
• Our district was a lean spending district in the
  base year.
• Thus, per pupil revenue amount was set lower than
  many other districts.

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Cool Waters of the mid 1990s

• The intensity of the storm was calmed by cool
  waters in the mid 1990s as enrollments continued
  to increase.
• Rising enrollments masked the monster of a storm
  that was taking shape.

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Warm Waters of the late 1990s and Early 2000s

• Warms waters of the late 1990s and early 2000s
  moved the storm from a tropical depression to a
  full-fledged hurricane caused by
• Declining enrollment
• Escalating health insurance costs
• The ticking time bomb Post employment health
  and dental benefits
• Low revenue limit
• Increased fixed costs
• Rising property values with subsequent decrease
  in state aid

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The Perfect Storm The Causes

• Declining enrollment Peak of 929 FTEs in
  1996-97 830 in 2001-02 636 in 2005-06 (Drop of
  32 from 1996-97 drop of 24 from 2001-02)
• Escalating health insurance costs 39 increase
  in premiums in 2001-02 school year
• Post-employment benefits some with health
  dental benefits until age 75 others until
  Medicare new hires none (426,000 paid in
  2004-05 projected 515,000 in 2005-06)
• Low per pupil revenue since 1993-94 (insufficient
  to maintain adequate programming, support
  increased costs, and resume deferred spending)
  Sparsely populated county with long bus routes
  (Some runs over 3 hours per day)
• Fund balance had dropped from 777,000 at the
  beginning of 2002-03 to 164,000 at the beginning
  of 2003-04

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Severe Declining Enrollment
Includes 61 students on open enrollment
Includes 30 students on open enrollment
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Escalating Health Insurance Costs
Includes auditor adjustment for two months
premium
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The Historical Perspective Change in Revenue
Expenditures
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The Historical Perspective Change in Fund
Balance
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The Perfect Storm Attempted Remedies

• Reduced personnel by 29 since 2001-02, the
  majority of which was in the last three years
  (including closing one rural elementary school)
• Revenue dropped by 317,000 expenditures were
  reduced by 1.877 million in two years (2003-05)
• Reductions of 1.2 million in salaries and
  benefits through personnel reductions, freezes on
  salaries (except steps/lanes), and change of
  health insurance plan with share of premium
• 700,000 in other budget reductions most of
  which was deferred spending
• Through 2003-05 bargaining efforts, district
  eliminated post-employment benefits for new
  hires
• Three referendum attempts prior to dissolution
  orderMay of 2004, February of 2005, June of 2005
  Live Within Your Means Philosophy

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Personnel Reductions
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Change in Revenue Expenditures through 2004-05
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The Perfect Storm Dissolution Order

• The majority of the Board of Education believes
  that any further reductions in personnel and in
  programming will be detrimental to the education
  of the children of our district.
• The Board of Education has limited class sizes at
  the elementary level to 25.
• The majority of the Board of Education believes
  the students deserve to have elementary music and
  physical education taught by licensed
  specialists, rather than the classroom teachers.
• The majority of the Board of Education believes
  the students deserve art, music, physical
  education, and vocational education at the middle
  school and high school.
• The school district has already eliminated the
  elementary art teacher, elementary guidance
  counselor, middle school Spanish, reduced course
  offerings at the high school in Spanish (only
  Spanish I and II), Business Education and
  Technology Education, reduced the number of HS
  Special Education teachers with the remaining
  high school teacher on overload, and has moved
  the classroom portion of drivers education to
  the summer.
• The district has no Reading Specialist,
  Curriculum Director, In-house School Nurse, or
  Principals. The elementary and MS/HS principals
  have been replaced with building supervisors,
  with the District Administrator assigned to
  teacher evaluations.
• What do we want for the children of our district?

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The Perfect Storm Dissolution Order

• Our children deserve adequate programming.
• Our children deserve to have access to
  technology.
• Our children deserve to have updated textbooks
  and other educational resources.
• Our children deserve to compete in athletics and
  other extracurricular activities.
• Our children deserve to ride on safe buses.
• Our children deserve to have an emotionally and
  physically safe environment within which to
  learn.
• What do we want for the children of our district?

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So Why Dissolution? What Do We Want for the
Children of Our District?
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Comprehensive School Reform -Expeditionary
Learning
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Youth Teaching Youth
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Comprehensive School Reform High Scope
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The Ever-So-Vital Extras
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Thus, Dissolution Order

• Resolution to Consider Dissolution June 29,
  2005
• Resolution to Order Dissolution July 11, 2005
• The Stand for Adequate Education
• for Our Children

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School District Boundary Appeal Board Hearings

• 7 member state panel, consisting of two board
  members from large districts, two from medium
  districts, and two from small districts in the
  state, plus deputy superintendent of public
  instruction
• The panel was to either affirm or deny
  dissolution
• Received testimony in August, September, and
  October

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Passage of November 8 Referendum

• 500,000 for 2005-06
• 750,000 for 2006-07
• 1,000,000 for 2007-08
• 1,250,000 for 2008-09
• 1,250,000 for 2009-10
• Additional monies will stabilize the district as
  we address issues important to the long-term
  financial stability of our district and further
  strengthen district educational programs.
• With the passage of the referendum, on November
  15, the SDBAB voted to deny dissolution.

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The Fall Out

• A Community Divided - Philosophical Differences
• Establish the level of desired programming and
  obtain revenue to support programming
• Force level of programming to fit current revenue
  live within your means philosophy
• Shattering of human relationshipsthe issues of
  adequate education vs. property taxes has pitted
  neighbor against neighbor and has torn families
  apart.

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Does the Educational Funding System Work?

• The day after the passage of the November 8
  referendum, the following question was asked by
  two different individuals
• Doesnt this prove that the state funding system
  works, the voters approved the referendum?

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Does the Educational Funding System Work?

• My response
• No children in any other school district should
  have to experience the struggles that our
  children have had to endure for the last two
  years. Their intense worry over losing their
  much loved school district should never have
  occurred. It has taken its toll on their
  spirits. We, as adults, must work together to
  ensure that children in other school districts
  never, never have to bear such weight. But
  today, our students rejoice and we rejoice with
  them.

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Courage of Conviction in Turbulent Waters

• The Florence Board of Education members are to be
  commended for the courageous stand that they took
  on behalf of the children of our district. They
  drew a line in the sand when they said, No more
  cuts. I have been proud to stand with them
  during this difficult time.