DJUSD Looks at State Budget Impact

DTA Stakes Out Position Against Salary Cuts

For the first time, DJUSD last night began working with real budget numbers rather than rough approximations. The bottom line is that California education took a pretty hard hit and unfortunately, they did not get the kind of full categorical flexibility that they were hoping for. In the coming days and weeks, we will examine some of these numbers more thoroughly.

Right now, we will just offer a brief summary of the district's budget picture and focus on some interesting responses from DTA and the community regarding the issue of the Davis High School Football Field and Track Renovation as well DTA's believed preference to take the 20 RFK's rather than a salary reduction.

But first a brief look at the budget climate at least right now. The state decided not to cut the number of school days. So the 180 day school remains in effect. The school district could have saved $250,000 for each day that was cut from the schedule, but that did not make it to the final budget.

Nor for all effective purposes was flexibility in the text books categorical funding. That would have been a way to save over $800,000 by forgoing updated English and Math text books. But again, that is not to be.

Finally, the speculation is that the state is going to soak up all of the federal stimulus money in order to balance their own budget. There was at one point speculation that DJUSD could get one to two million from that pot, but that is believed to be off the table as well.

There is some categorical flexibility, but that flexibility is off-set by nearly one million in categorical fund reductions. Moreover, there are decreased penalties for going over the 20:1 ratio for class size, but it is not a full flexibility either.

In short, the district is going to have to find a way to reduce its deficit and the most likely to occur either through salary cuts to employees or through pink slips.

STADIUM ISSUE

What is becoming interesting at this point is where the teachers and DTA stand in terms of what the district ought to be doing. Several came up and spoke during public comment expressing displeasure at the district's decision to fund the construction of the new DHS football stadium.

This has become a source of great criticism within the community. Indeed in the Davis Enterprise yesterday appeared two letters criticizing the building of the new stadium.

The most pointed read:

"'Teachers asked to take 2.5% pay cut' along with a higher headline citing the school board's decision to proceed with a $4 million plan to upgrade the football stadium. What a travesty!

Obviously, a stadium is more important than classrooms and teachers and student learning."

Coupled with the criticism during public comment, Superintendent James Hammond responded in perhaps his most heated manner yet attempting to explain once again the funding issue.

What the district needs to understand on this point is that they are not only losing this public relations battle, they are getting killed by it. In terms of the facts, the district is right, the funding sources are different, funds that are available for construction cannot be used for instruction.

Guess what? The public is not going to understand that. They see multimillion dollar upgrades to a football stadium and at the same time the district is contemplating about cutting teacher positions or asking them to take salary cuts, and the public is going to be suspicious of the school district.

The district now puts itself into a bad position. They either have to try to explain this to the public, which will be difficult and perhaps not fruitful. Or they can allow these beliefs to fester. There is no election at this point in time, but people do not forget these kinds of things.

From the teachers standpoint, DTA President Ingrim Salim laid it on the line last night.

"I want to address the stadium question because it is out there. I think what you should all be aware of is that certainly there is different pots of money and many of us can grasp that, but not all of us does. That’s just confusing. It’s going to be really hard to mitigate the effects of the confusion.

The second piece from the DTA standpoint is that while probably from the community standpoint they supported the stadium, certainly within the teaching community, they really wanted to see Emerson renovated. There’s not a way to fix that perception either."

The teacher issue thus is somewhat different. They understand the funding differences, at least in theory, but they believe that the priority should have been Emerson rather than the high school.

The district has a difficult position here because they are correct on two essential points. As mentioned before the funding. And the second problem is that the current situation is untenable. You have a serious safety risk, and that is a liability to the district.

However, the timing of this could not have been worse.

DTA WOULD RATHER TAKE PINK SLIPS THAN A SALARY CUT

Ingrid Salim's follow up comments were just as interesting. As she laid out for the district the likely but not official DTA position on salary cuts. Basically they would rather take the 20 position cuts rather than a reduction of salary.

Here is her lengthy statement from last night:

"Last year we did have reserves and yet we RFK’d 114 people. So people are just suspicious even though I can look at the budget numbers and see what happened as a result of last year and now we’re not being quite so conservative. But last year there was money in reserves that weren’t applied immediate to personnel. So we RFK’d people, we didn’t end up laying off, and we backfilled. We filled back in with DSF money… But we didn’t use those reserves right away. So that might give some understand about why people keep questioning about are there reserves and are suspicious that there might be. I personally don’t question that, I think we’re using them differently than we did before. That’s just the background of where that suspicion comes from.

The last piece of that is that it’s just real hard to correct misinformation that gets out. Whenever people are defensive and afraid for jobs and for money or whatever they certainly spin things. We can do our best job to try to correct misinformation but it’s just a battle. So just to know that. We can civilly disagree but the battle of misinformation will still be there. And perceptions are very hard to fight.

The other dicey piece is that you asked both unions to consider salary cuts and where w are is a combination of all of these perceptions. The reality is that we would have to have all of our membership voting or over half of them… Our union will be doing a survey to see where people are in terms of what they want to do.

But the undercurrent that we’re getting if we’re really talking about 20 jobs, and last year it was 114 and we weren’t talking about a salary cut, that probably the majority of the people say that’s okay. It’s okay to cut 20 jobs. Basically that’s programs that probably need to be tightened anyway if we’re going to have sustainable education with a smaller budget. The bulk of people that we’re hearing and getting information from, and like I said we don’t have a formal hearing to say that for sure, but that’s sort of the sense we’re getting…

We’re certainly going to ask, we’re certainly going to push forward with this concept, and there are people who say no, let’s take a cut for everyone. But that’s kind of what’s out there right now.

The final part is that there are places where we’d say it would be okay to increase class size, for instance at the 9/ 10. I’m not speaking for DTA, I’m just saying things that we might say. The 9/10 English and Math to [a class size of] 24 instead of 22. That’s not a huge impact on class size reduction. That would be preferable to something like considering a salary cut.

We do worry about the logistics of putting into place something like a salary cut or anything like that, because of the exit strategy—when do you change it? What happens to retirees? And all those little tiny things that just seem huge and overwhelming.

We will start that process next Tuesday [petitioning our members]. We’re pretty comfortable about where things are right now in terms of going forward. We’re going to be going over the budget pretty closely ourselves, finetooth combing, trying to find other ways to meet this deficit."

From my standpoint, the position laid out by Ms. Salim makes a good deal of sense from the teacher's standpoint. Salary cuts are problematic for a number of reasons including the difficulty of making ends meet during tough economic times.

Furthermore two other essential points were raise. First, the sheer number, if it is indeed 20, one would think the likelihood of anyone losing their job was pretty small. For one thing you have attrition through retirements and through people moving.

Second, she makes the point, a point that was made on this blog at times, that if we want to have a sustainable education on a smaller budget, and a smaller budget is the reality right now, then tightening up the programs is probably a way to do it.

The part that somewhat surprised me is that the teachers support a slight increase of class size at the 9/ 10 level, a level given full flexibility by the state, from 22 to 24. She argued that was not a huge impact on class size reduction but was preferable to taking a salary cut.

The bottom line here is that a salary cut would have to be negotiated with the DTA through the collective bargaining process. This was a strong and public signal that DTA is not there right now.

The school district has an ongoing perception problem in dealing with the DHS stadium repair. They had better get on top of that issue or it could backfire on them in the future.

---David M. Greenwald reporting

Prospective Budget Includes Deep Cuts to Education

No CSR Flexibility*, Categorical Flexibility

At the outset, I should qualify this analysis as saying that it could change in a final budget bill or could get thrown out the window if there is no budget deal.

For this year, the budget has a $2.4 billion reduction for what was budgeted in the 2008-09 Budget Act. It has a $5 billion reduction in Prop 98 Funding from 2008-09 to 2009-10.

Cuts to Categorical Programs and Categorical Flexibility

The Governor proposes $1.9 billion in K-12 program reductions split evenly between revenue limits ($945 million) and categorical programs ($945 million) in the current year. These reductions continue in the budget year, growing to $2.4 billion, an increase of approximately $535 million. More than 50 categorical programs will be subject to across-the-board reductions that will be allocated proportionally and are estimated at roughly 15 percent. Deficit factors are established for revenue limit reductions in both years.

The budget provides comprehensive categorical funding flexibility over the next five years to mitigate program reductions. Specifically, the budget allows local educational agencies to transfer unlimited funds from more than 40 categorical programs to their general purpose accounts commencing in the current year. Another 11 programs are subject to reductions, but are not subject to categorical flexibility programs. [Eight major Proposition 98 programs are excluded from any categorical reductions or flexibility, including Child Development, Child Nutrition, Economic Impact Aid, Special Education, Home-to-School Transportation, After School Education & Safety, K-3 Class Size Reduction, and Quality Education Investment Act.]

This is the big one because it allows the district to have flexibility with left over categorical funds. However, it does not include flexibility with regards to Class Size Reduction (CSR).

*That said it does reduce the penalty for exceeding the maximum class sizes allowable under the k-3 CSR program for a four year period.

There will be no COLAs, which will save the state an approximate $2.5 assuming a COLA of 5.02%.

The bill allows prior-year categorical fund balance to be used in the general plan for the current year and the budget year. However it excludes access to fund balances from seven programs [Economic Impact Aid, Special Education, Targeted Instructional Improvement Block Grant, Instructional Materials, Home-to-School Transportation, CAHSEE Supplemental Services, and Quality Education Intervention and Achievement.]

The bill suspends the statutory requirement to purchase newly adopted textbooks and other instructional material.

It reduces Routine Maintenance Reserve requirement from three percent to one percent for five years.

It suspends reserve and reporting requirements for deferred maintenance for five years.

What Do This Mean For DJUSD?

One of the key questions here is what it mean not to have the CSR Flexibility but a reduction of the penalty for exceeding maximum class sizes for a four year period. I suppose this is a compromise to keep the provision on the books but to give districts a greater degree of flexibility. It will be interesting to see if this sticks in the budget and how DJUSD interprets it.

That point aside, I think this puts us back to the earlier budget assumptions.

Does this put us back to the budget assumptions from January 28, 2009?

That would add $1.1 million or so for the Categorical Allocation Transfer in 2009-10 and $400,000 in reduced restricted maintenance transfer.

The question then is what the district will do. Recall that without CSR, that is one million that the district does not have for 2009-10 and two million for 2010-11.

That gives the district probably four options for balancing the budget through 2010-11. Option one is to use the categorical flexibility and keep CSR as it is, and keep salaries where they are. According to the budget model from January, that would force the district to eat up the remainder of its fund balance.

Option two is to bring the CSR adjustment to 22:1 or 23:1 as some of the board members favor. That would free up $1 million at 22:1 or $1.5 million at 23:1. How many teaching positions would that mean would be lost? Does that require pink slips or can simply attrition achieve the changes? Part of this will depend on what the penalties are for being out of compliance? The other part will depend on the interpretation of Measure Q's bringing down the ratio to 20:1 when the state's requirement is 22:1.

Option three would be to keep CSR as it is and reduce teacher and classified employee salaries by 2.5%. The advantage of this would be that there would be guaranteed zero layoffs. The disadvantage of this is that with categorical flexibility, there is likely no way that DTA would submit to pay cuts.

Option four would be a combination of reduction in CSR with some pay cuts.

It is clear that DTA will push very hard for Option One. It will be interesting to see if these indeed are the options at this point and what the district recommends.

All of this assumes the budget eventually passes with these provisions. That is in doubt at the moment. If the budget remains unresolved, then all bets are off and the future looks far more bleak than it currently does.

---David M. Greenwald reporting

Davis Teachers Angry at Contract Offer from School District

Last year, Davis teachers were given a 6.5% pay increase that many felt was long overdue. To the school district, this increase was supposed to cover both years of the new contract. However, the decision to give the full 6.5% percent in the first year and leave the second year undetermined may end up triggering a bitter and protracted contract dispute.

For their part, teachers will suggest that the 6.5% closed the gap on where their wages should be, but more pointedly they site figures suggesting that the school district spends more on consultants and legal counsel than they do on health benefits for the teachers.

Twice now at recent school board meetings, teachers have protested the contract offer of a one percent pay raise.

Wearing green T-shirts with the emblem, "2+2" on their chests to refer to their contract demands of a 2 percent salary increase and 2 percent toward improved health benefits.

From the standpoint of the school district, they just do not have the money.

School board President Jim Provenza in September:

"The state does not give us a 4.5 percent COLA (cost-of-living adjustment) just for a salary increase — I wish they did. They give us 4.5 percent for all cost increases, whether it's utilities, building costs or books. ... Everything that increases in cost has to be covered by that. (And) it also has to cover what we lose from declining enrollment... We were happy to provide a 6.5 percent (salary) increase last year; we knew that would put us in a deficit this year."

Bruce Colby is the associate superintendent for business services.

The school district is facing declining enrollment that could lead to the districting losing around $600,000 in ADA next year. According to Mr. Colby, a one percent pay increase would cost the district $368,000 per year, while a 2 percent increase would be double that amount, or $736,000.

The question for teachers however; is, what is the best expenditure of money by the school district? They cite statistics that show that the pay for administrators has gone up much faster than that for teachers. They cite that the pay for the new superintendent was increased far more than that for teachers, and while the amount given to the superintendent may be a drop in the bucket compared to the teacher's salaries, it is emblematic of where the priorities of the district lie.

On the one hand, you are paying your top executive, the new superintendent nearly $200,000 per year in salary alone.

One the other hand, DTA President Tim Paulson argues:

"We have 125 members paying over $900 a month [toward health coverage]. Many are single parents, and 25 percent of their salary goes to health benefits. That is ridiculous."

That kind of disparity in a public institution is bound to create resentments come contract time.

The Teachers have a delicate path to walk at this point with the upcoming Measure Q vote. From the teacher's perspective - - over whom 98% voted to recommend endorsement of Measure Q - - is absolutely essential as it provides the district with around 16% of its funding. Without the passage of Measure Q, we will see deep cutbacks in programs and that would mean equally deep cutbacks in the number of teachers and possibly their salaries.

However, the teachers also have to recognize that the district needs and desires that money just as badly as they do, and they hope that that will give them a bit of leverage.

The school district felt that they had a good round of negotiations with the teachers last week, and at one point it felt like this would defuse the current situation.

Keven French at the school board meeting said as much:

"We did have a positive meeting (with the DTA) one week ago."

He claimed that they made a new offer which included a cost-of-living increase and upgrades to the current health benefits package, but it appears from the response by teachers at the school board meeting that this was not enough.

We shall continue to monitor this situation here on the Vanguard.

---Doug Paul Davis reporting