The Edmond Sun
Superintendent Janet Barresi recently announced her desire for districts to provide teachers a $2,000 across-the-board raise. Barresi said the plan would cost $100 million annually, which Barresi proposed be funded primarily from school district carryover funds.
Two state legislators joined superintendents across the state in saying the proposal is not sustainable for districts.
Rep. Lee Denney, R-Cushing, and Sen. Jim Halligan, R-Stillwater, oversee funding for common education in Oklahoma. They agree that spending one-time money on a reoccurring cost jeopardizes future operations of the state’s school districts as it would only be a short-term solution to a long-term problem.
“I’m very excited about the thought that we might be able to give our teachers raises, but being in the business I’m in, I certainly worry about a funding source, and a dedicated funding source, so that we could keep the raises funded every year,” Denney said.
Denney and Halligan both said Monday they support an effort to increase teacher pay, but that it would be difficult for the Legislature to come up with the $100 million needed to fund the plan each year after the initial raise.
In Edmond, Superintendent David Goin said, “Certainly, we would all be in agreement that an increase is needed to compensate Oklahoma teachers at a more appropriate and competitive level.
“Interestingly, the state superintendent suggested that the primary source of funding for the increase come from local districts’ existing year-end fund balances. What is implied is that the June 30 general fund cash balance represents ‘surplus’ funding. From an Edmond perspective, I would respond, rather, that a carefully managed fund balance provides adequate cash flow to allow us to meet obligations. It certainly does not represent an available ‘surplus’ for discretionary spending. Used to fund a salary increase, it would represent an expenditure of one-time monies for a recurring obligation.”
Fund balance is necessity
A fund balance is necessary because the July through November payroll for Edmond Public Schools will require about $36 million, Goin said.
Goin added the district ended FY2013 on June 30, 2013, with an available fund balance of about $15.4 million. With state and other sources of revenue to be collected from July through November anticipated to be in the neighborhood of $25 million, it becomes clear that for payroll alone, a healthy incoming fund balance will be necessary. Beginning in December ad valorem collections will significantly increase cash flow.
“In further consideration of the maintenance of a fund balance, fiscal years 2010 through 2013 were distressing for Edmond and Oklahoma school districts,” Goin said. “During that period of time overall state allocations to Oklahoma school districts fell dramatically. When increases in the state’s student population are built into the equation, about $240 million less was allocated than would have been the case if FY2009 funding levels had been sustained. Locally, in FY09, our basic state aid for Edmond was $38.8 million; in FY13 (and with an additional 1,500 students) state aid was $33.4 million. While some progress was made by the Legislature for FY14 funding, the gap compared is still substantial.”
Goin explained what assisted in keeping Edmond and Oklahoma districts, generally, from having to make extremely deep reductions in programs and personnel over the last four fiscal years was a significant infusion of federal stimulus and Education Jobs funding to supplement budgets.
“At the time the state was reducing funding allocations, the federal government supplemented Edmond Public Schools’ funding by (about) $21 million,” Goin said. “The judicious use of these federal funds over the ensuing budget cycles has allowed us to maintain reasonable class sizes and programs that benefit students. The supplemental funding also contributed to our achievement of positive fund balances and to the provision of modest teacher salary increases.”
Goin went on to say the current situation is that federal funds infused into earlier budgets are now depleted and “sequestration” reductions are placing basic federal program allocations at lower than pre-stimulus levels.
“Even with these constraints and an expectation that our beginning fund balance for FY15 could fall close to a 6.5 percent level (5 percent is mandated in local board policy; the state allows a 14 percent carryover), teacher salaries have been slightly increased this year to include a step increase at a cost of $850,000 and the possibility of a $200 stipend this coming spring, a $374,000 expenditure, should we maintain at least a 6.5 percent fund balance following the receipt of the mid-term funding adjustment from the state,” Goin said.
“Within that context, the cost of a $2,000 increase for teachers this year would require $3.7 million and place us in precariously low fund balance territory. Beyond being unsustainable as a recurring expense in future years, it would not even be affordable the current year.”
Tulsa Public Schools Superintendent Keith Ballard agrees with Goin’s observations.
“To suggest that carryover funds be used to cover teacher raises is a poor solution, especially given the decline in per-pupil funding we have experienced over the last five years,” Ballard said. “A cardinal rule of school finance is not to pay recurring expenses, specifically teacher salaries, from onetime funds, specifically carryover funds.”
District’s goal: Competitive pay, quality teachers
Goin added the district’s goal has been and will continue to be to provide the most competitive compensation levels possible as board members and administrators seek to secure and retain quality teacher, administrator and support services employees.
“But, we must be prudent in administering budgets and fiscally responsible as salary increases are contemplated,” Goin said.
“Given the following: 1) State funding to Edmond is millions of dollars below what it would have been on a FY09 per pupil basis, 2) federal stimulus monies depleted and, 3) thousands more students to serve; our ability to fund locally a much deserved $2,000 increase in teacher compensation would be both imprudent and irresponsible. This is especially true when one considers that our commitment to salaries and benefits already exceeds 90 percent of the district’s general fund budget.”
Edmond leading way in pay for Oklahoma teachers
The last state-funded pay increase for teachers was approved for 2006-07, and provided for a partially state-funded increase of $3,000. Since that time Edmond Public Schools has added $2,755 to the salary schedule for steps 1-36, and the base for step 0 has increased $2,255.
The state minimum salary is currently $31,600 and the Edmond minimum is $34,416. At this time, the Edmond minimum salary is $2,817 — or almost 9 percent more than the state minimum.
During the same period of time, state aid has dropped from 35.5 percent to 26 percent of district revenue. The bottom line is that this district has been using its local funds to increase teacher salaries.