The House and Senate appropriations process is currently considering Governor Rick Snyder’s proposal for K-12 funding and I wanted to share how it will impact Godfrey-Lee school children.
According to the House Fiscal Agency, our district will receive a foundation allowance increase of $111 under the Governor’s plan. Other categoricals such as “best practice,” “performance,” “equity (rolled into the foundation but not increased),” and even 31A at-risk funding remain flat from the current year. Thus, the Governor proposes a classroom-based increase in our foundation from $7,076 to $7,187, a 1.56% increase that is below the expected inflation rate for 2014. Just as a reminder, the Governor’s proposal is still $287 per student below the 2009-11 levels prior to him taking office.
Our current K-12 student enrollment is 1,916 (a 16.4% growth in enrollments over the past ten years). That means at first glance, the Governor’s plan provides our classrooms with $212,676 in new funding assuming flat enrollment, just 1.4% of our projected state and local foundation and categorical funding, again falling short of the projected rate of inflation.
However, Governor Snyder’s proposed K-12 budget increases our MPSERs retirement costs by $56 per pupil or a total of $108,563 removed from the “new” classroom funding. Nearly half of the increase in the foundation allowance will be eaten up by these costs for which the school district has no control over. In summary:
$212,676 increase in foundation allowance ($111/pupil)
-108,563 increase in retirement costs ($56/pupil)
$104,113 net new funding (0.67% increase)
The increased retirement costs result from a reduction of $20,788 in the employer share (lowering of the district cap from 20.96% to 19.76%), only to be offset by an increase of $129,351 due to loss of 147a funds proposed by Governor Snyder. It is interesting to note that had the Governor left the cap and 147a funding alone, the district’s cost would have increased by "only" $87,212, thus his plan is costing our students an additional $21,351 in classroom funding.
Despite help through previous legislation and our Board's collaborative work with employee associations to hold down our normal rising costs, the increased health care cap this year is still expected to cost the district an additional 2.9% along with a 10% increase in projected dental and vision plan costs, for a net increase of $62 per student or a total of $118,648. Please remember that while dental and vision plans are local issues, the state controls the rising cap on health care costs borne by the district.
$104,113 net new funding (before increased health care costs)
-118,648 increased costs for health, dental and vision plans
$ (14,535) net new money
As the summary above concludes, the district is now looking at no additional dollars for the classroom under Governor Snyder’s anemic proposal. Like any business or organization, we also face increases in employee costs as our staff members deal with the rising cost of living and raising families. This past summer, we worked collaboratively with our employee associations to bargain lower costs after two years of deep freezes in wages and benefits. We feel our plan is a model for both fiscal responsibility and demonstrating appreciation for the solid work our staff is doing in a district fraught with many learning challenges. Overall wage increases for employees this coming year is projected at $100,737 or $53 per pupil. No decision has been made on salary and wage increases for non-union and administrative personnel, most of which have only had one normal increase in the past five years.
$ (14,535) net new money (under Governor’s proposal)
(100,737) salary and wage increases
$(115,272) combined new money and personnel cost increases
So as you can see, despite the political rhetoric we are facing additional cuts in classroom spending that will have further negative impacts on our students. The Governor’s self-proclaimed “3% increase” in K-12 funding actually rolls out to a minimum net decrease of $60 per student before inflation is even factored into supplies, materials, technology, and fixed costs. In addition, our district is required to sustain many of the costly innovations that were previously funded by the federal SIG support for Lee High School to ensure it does not return to the bottom of the state’s ranking system. Isn't that a bit strange? It's the state's ranking system yet the federal government had to provide the needed resources.
As most districts, we have had to utilize a significant portion of our fund balance which has fallen from a high of 23% in 2008 to a current projection of just over 10% for this school year. Had we not experienced an unexpected influx of new students this past fall, it would have shrunk to 8%.
What we are asking the House and Senate to do is to support the alternative funding plan that proposes to shift funding from a variety of categoricals into higher per pupil grants ranging from $250 to $278. For Godfrey-Lee, a $278 increase versus the Governor’s proposed $111 would at least provide enough flexible funding to not only offset the increased retirement costs under his plan, but would actually ensure approximately $204,700 in new classroom funding ($106 per pupil) that could be used for sorely needed classroom curriculum materials, or to hire highly qualified English language teachers in grades K-8 where students struggling with limited English proficiency number range from 35 to 50% of each grade level. We face other needs in the area of literacy and math proficiency as well as transitioning to the new Common Core and science curriculums as Michigan moves forward.