While hoping for the best from Olympia, the Spokane Public Schools board is preparing for the worst in the face of a projected loss of $43.5 million in levy revenue.
That could mean layoffs for dozens or even hundreds of employees.
Following confirmation of those numbers from chief financial officer Linda McDermott, the school board voted unanimously Wednesday night to approve a resolution that would put staff reductions on the table to help reduce that deficit.
Board member Deana Brower said she has “faith in our staff and our board to look at every solution as far from the classroom as possible.”
“However, we are faced with very difficult times, and this resolution is necessary to put all options on the table to make the best decision possible for the education of our students,” she said.
McDermott reminded board members the resolution was a “procedural step that we have to take within the language of our collective bargaining agreements.”
Like many districts in the state, Spokane is facing severe reductions in revenue following the approval of a new funding model and levy restrictions adopted by the Legislature.
In Spokane’s case, that shortfall totals $43 million over two years.
Spokane’s deficit and those of other districts are attributable largely to the complexities of the state Supreme Court’s landmark McCleary decision, which included a cap of $1.50 per thousand of assessed value.
“This has definitely changed our operating environment, and how we sustain our spending levels with the amount of revenue we are expecting to receive,” McDermott said.
Anticipating a shortfall as early as last fall, McDermott said staff has spent “significant time in looking at budget adjustments that may be possible in the central office, reducing positions and looking at the efficiencies of how we conduct our business.”
According to board member Brian Newberry, the district has saved $8 million during the past six months, though that figure couldn’t be confirmed.
However, McDermott said, “We feel like we are not going to solve our gap in only central support operations.”
Board members hope that pending legislation will mitigate or eliminate the potential deficits.
“This is not the resolution any school board wants to make, but ultimately we must operate with a balanced budget,” board President Sue Chapin said.
“I think we will know more by the middle of April exactly what the whole picture is,” she added.
Katy Henry, president of the Spokane Education Association, was in the audience Wednesday night. She said the teachers union is “waiting to hear from the Legislature.”
Falling in line with most districts in the state following the McCleary decision, Spokane agreed last summer to use the new state money to give teachers raises that averaged 13.3 percent.
Noting the raises might cause future problems, the school district increased its 2018-19 budget by $21 million, swinging from a $9 million surplus to a $12 million deficit.
That’s because while the McCleary decision pushed more state dollars into school districts, it also led to caps on local levies that communities routinely passed to supplement staffing and learning materials.
That cap, at $1.50 per thousand dollars of assessed property value, has restricted how much levy money school districts can seek and spend.
As districts evaluate their funding issues, they also are bumping up against contractual obligations that require them to inform employees of any staffing cut possibilities.
That led to Wednesday’s resolution.
“It’s strange to be in this position after the hope around the McCleary decision,” board member Mike Wiser said. “It’s unfortunate.”
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