North Kitsap School District budget: Enrollment decline, state budget cuts converged into 'perfect storm'
April 11, 2011 · Updated 9:49 AM
By RICHARD WALKER
and KIPP ROBERTSON
North Kitsap Herald
POULSBO — As North Kitsap School District officials planned for the 2010-11 school year, unseen forces were at work, converging into a perfect storm that administrators say they didn't see coming.
The district’s budget for 2010-11 was $63.5 million. Its projected enrollment was 6,453, based on a formula — factoring in enrollment trends over the last four years and community growth, such as birth rates and residential construction. The district budgeted for 425 teachers. It expected to end the year with a surplus of about $3.2 million. Its carryover fund — money that is allocated to building or programs left unused at the end of the year — was expected to be $1.5 million, to be used to fund future projects or those that may be currently under way.
But when school started in September, the district’s schools had a lot fewer full-time equivalent students than expected, according to the student count done in October. Administrators were shocked. School had started before Labor Day — an anomaly, Superintendent Richard Jones said — so administrators kept their fingers crossed that students would show up after the holiday.
After the holiday, enrollment was still 114.1 below projections, for a total of 6,338.9, according to information provided by the district. At $5,242.46 per student in annual state funding, that’s a total of $598,621.
Administrators are still not sure of the cause of the enrollment drop. Jones said student enrollment ebbs and flows: Families move here for jobs that don’t work out and then move around year-end. Students drop out — the drop-out rate was 2.7 percent of the total student body in 2008-09, according to the Office of Superintendent of Public Instruction — but some return.
In January, the state adjusted the district’s per-student funding according to the average daily attendance in September to December. The reduction: $739,179.
Then the news started coming from Olympia as the Legislature, looking to erase a state deficit, started paring the budget: First, a reduction in so-called enhanced funding to hire teachers to reduce class sizes in grades K-4: $610,075, enough to pay for 7.4 teachers. Then, the governor’s 10 percent across-the-board cuts: $100,000.
The funding loss has been lessened by administration reductions, freezing reserves for utilities, and more federal funds to make up for local revenue lost due to the presence of tax-exempt federally-owned property and to accommodate children from military families.
But the final toll is chilling: An estimated budget shortfall of $794,033 and possible elimination of 38 teaching and staff positions for 2011-12.
“In addition to the 30 FTE the district is overstaffed (now), there will be a recommendation to reduce an additional 8.0 FTE to be able to respond to any cuts the state legislature may make,” district Communications Director Robyn Chastain said. “This will provide options for the board as they consider rebuilding the reserve and address an estimated additional $800,000 shortfall. Positions being considered include staff at both the elementary and high school levels.”
State law requires Reduction in Force (RIF) notices to be issued by May 15. The school board has a study session scheduled April 12; the next regular board meeting is scheduled April 14 (a story in the April 1 Herald incorrectly reported that a meeting was scheduled April 7).
Board policy No. 6000 states that the board’s goal is “to annually provide a budgeted reserve fund at 3 to 5 percent of the current budget. The reserve can be used in the event of a loss of funding or unforeseen fiscal situation."
If the board changes its target from 5 to 3 percent, the extra reserve money could potentially be used to reduce staffing layoffs or program cuts. However, the school board has yet to make a recommendation to lower the reserve, which is projected to be at 4 percent at the end of the school year.
Even if the school board decides to lower its reserve target to 3 percent, there is no guarantee that extra money would be used to soften the blow to staffing or program cuts, Chastain said.