The budget was approved by the Renton School District Board of Directors, but the discussion is just getting started.
Representatives for two classified staff unions are questioning the Renton School District 2019-20 budget presentation. Union leaders at the second budget hearing believe the presentation contained “misinformation” about the budget deficit the district predicted in the near future, previously reported on in the Renton Reporter.
What directors approved:
In adopting the 2019-20 budget, which passed unanimously on June 26, the board of directors approved the five major fund expenditures;
•$277.6 million for the General Fund.
•$45.5 million for the Capital Projects Fund.
•$950,000 for the Transportation Vehicle Fund.
•$27 million for the Debt Service Fund.
•$1.4 million for the Associated Student Body Fund.
The district also presented during both public hearings that the general fund will see a budget shortfall in 2019-20 for the first time in five years; the fund begins with $25.3 million and ends with $17.1 million.
According to the district, if this $8.3 million shortfall continued each year, it would drop the end fund balance into the negative in 2021-22. The district believes cuts or new revenue must be found to accommodate for this.
Cuts aren’t necessary this year thanks to $6.8 in unanticipated revenue, according to the district.
District Spokesperson Randy Matheson stated in an email unanticipated revenue came from levy monies from higher assessed property values, unexpected transportation and K-3 compliance funding.
This left the school district a higher starting fund balance for the 2019-20 school year than in the past. If the starting fund balance was the projected $18.5 million, which hadn’t accounted for unanticipated revenue, the ending fund balance would have a slimmer shortfall, about $1.3 million.
The board also set the levy collection for the next school year, at $40 million for the general fund, $24.5 million for the debt service fund and $24.4 million for the capital projects fund.
Unions claim “misinformation”
Valisia Simpson, president-elect of the Renton Education Support Professionals (RESP), spoke at the second public hearing for the budget.
“The presentation is misleading at best. It is designed to tell a particular story,” Simpson said.
The union members in attendance Wednesday, June 26, also represented Renton Professional Technical Association. UniServ Director Kristi Taylor said after the first budget presentation on June 12, they had serious concerns about the budget. Taylor said union representatives felt the presentation created a narrative rather than taking an unbiased look at the numbers.
Taylor said the data doesn’t back up the idea that a budget deficit is in the school district’s future.
“Although in their presentation they’re saying it’s a budget shortfall, there really isn’t,” Taylor said. “That is misinformation designed to show a level of concern, or funding deficit, that does not exist.”
Specifically, Taylor said the state funding continues to increase more than the lost levy funding.
The district cannot collect $18.5 million of the $57.1 million voters approved for levy collection in 2019, and they can’t collect $15.9 million of the $56 million voters approved for 2020.
Meanwhile, McCleary funding from the state is provided $88 million dollars to Renton School District from 2015 to 2023.
State funding has also become a larger portion of the budget pie over the last three years’ budgets from the school district.
“The funding from the state has increased to the point where total funding to the district continues to go up,” Taylor said. “Even next year when they see the dip in levy funding, and they’re concerned about 2020-2021, the funding goes up.”
The unions also asked the district why it’s being called a budget shortfall, when the district is ending this year with a 9.7 percent ending fund balance. In comparison, the Washington Education Association recommends a 3-5 percent ending fund balance for a school district the size of Renton, Taylor said.
Taylor said the district is “hyper-focused on the dip in levy funding that’s going to take place,” and she isn’t sure if uncertainty in state funding is what’s causing them to err too far on the side of caution.
“I think they’re framing it through wanting to be fiscally responsible, and we would never argue that. It’s not in our interest for the district to be bankrupt, right,” Taylor said. “But the reality is if you look at the trends over the past few years, the district has consistently over budgeted and under spent.”
The district has had a higher ending fund balance than budgeted every year since the 2015-16 school year. In 2017-18, the district had a $2.5 million higher ending fund balance. In 2016-17, it was $5.7 million higher.
“That’s taxpayer money that should be going to students and staff,” Taylor said.
The district will also be losing some state funding, about $1.1 million, for not meeting the kindergarten through third grade ratio compliance of 17 students per one educator. It will be working down its ratio from 18.5:1 down to 17.5:1, but that still won’t get it within compliance.
Taylor said the penalty from the state is disappointing. She said the district didn’t see it as enough of a priority to move that ratio, to the detriment of students and educators.
The two unions represented at the second public hearing are in the bargaining process, which will impact the final budget numbers. Taylor and Simpson both said they hope the district will be open and transparent at the table.
Certain questions about where state funds are located in the 2019-20 budget haven’t been answered by the district, Taylor said. The unions state they have enough information to question what is being presented as fact.
Taylor said after last year’s bargaining process, where the district came to the bargaining table with only a 3.1 percent increase in wages, there’s a lot of trust to rebuild.
“We packed the board room, we had classified staff going up and sharing their personal stories of poverty, which is really painful and traumatic,” Taylor said. “We had to fight and fight and fight, for our paraeducators, who are the lowest paid in the district but also work directly with students.”
Taylor said she hopes they can all enter a negotiation process this year that is transparent and productive.
School district: “We are confident in the accuracy”
Matheson stated in an email the district is confident in the accuracy of the budget projections, including the shortfall and future projection for a deficit.
Matheson stated the budget shortfall was “largely the result of a salary increases for teachers and other staff in 2018-19, and the district’s commitment to pay for the increases now and in the future.”
That shortfall was also the result of reduction in levy collection, and the new staff benefits plan School Employee Benefits Board (SEBB), which will increase costs of insurance and benefits for employees, according to the district.
Matheson stated the reason this unanticipated revenue is not possible next year is because the district will not be able to collect additional levy funds because of a levy lid placed on the district.
The district had a higher ending fund balance the last three years because it reduced costs since 2015, as part of a two-year restoration plan to increase the unreserved fund balance with one-time savings.
These savings kept them from reducing staff.
“This year instead of passing a budget that adds to or keeps the fund balance neutral, we have passed a budget that utilizes undesignated reserve fund dollars,” Matheson stated. “Because of this we believe our fund balance will not end higher than anticipated.”
Matheson stated the district does not comment publicly on negotiations outside of the bargaining table, but the district will continue to negotiate fairly, honestly and openly with union partners and is “committed to our staff and value their work to support student learning.”