Courtesy of Renton School District.

Courtesy of Renton School District.

Under-enrollment in Renton may lead to budget, staff cuts

RSD asking for feedback on how to cut its spending due to impending losses

Last year while other districts were cutting back, Renton School District was able to retain staff and programs. But they also projected a deficit in the near future, as previously reported by Renton Reporter.

Overestimating the number of students that would be enrolled in Renton schools for the 2019-20 school year, as well as previously anticipated losses including levy collection caps, are going to cost the district to the tune of $12-15 million in cuts. That’s 5 percent of the district’s budget.

This is a budgeting decision more difficult than has been experienced in over a decade, according to district leaders.

Before the district staff make a recommendation to the school board on which programs or staff to cut, they want to hear from the community. The loss will inevitably impact staff as 85 percent of the budget is related to staffing costs, but the district states it intends to make cuts “as far from classrooms as possible.”

Instead of making a broad cut across the district, Assistant Superintendent of Business Services Fred Maiocco stated on the webpage presentation the district is asking each program and department to justify its staffing and expenses and will be reaching out throughout the end of February.

A new webpage went live on the Renton schools website Thursday, Feb. 13 detailing the problems facing the district. The evening before, school board directors were briefed on why reductions need to happen, mostly emphasizing 300 less students this year than they anticipated and levy caps. Less students, is less dollars to the district from state funds.

Maiocco called the projected budget when speaking to board directors “the perfect storm,” showing graphs of costs increasing and revenues decreasing as they project enrollment to continue to decrease for several years. He also noted that this it will be “incredibly painful, but absolutely essential” as the district re-balances its budget.

Enrollment

Student enrollment dropped by 300 students so far, with more expected to be lost by the end of the school year. The district states this was an unexpected drop. This results in a $2.88 million revenue loss from the state and disrupts the district’s historical trend of enrollment growth, which it had expected to continue.

The district is now recommending that they start conservatively estimating the number of full time equivalent (FTE) students they will have that school year (FTE students are important to the state funding calculations). Superintendent Damien Pattenaude explained to the board many South King County districts were overestimated for enrollment numbers, and many Pierce County districts underestimated, under a demographer used by most districts. Maiocco stated in his online presentation on the shortfall that enrollment is now projected to keep decreasing for a few years before leveling off.

This year, the school board approved a dig into reserves to help supplement the district’s $8.25 million structural deficit, but administration say the practice is not sustainable.

Questions have been raised before by unions and other district partners about why the district cannot use funding reserves for staff wages. In 2018-19, the district had a high end fund balance, over the 5 percent goal, at 9.7 percent. This year, the hit of low student enrollment leaves them at 4.7 percent end fund balance.

Maiocco told school board directors that the reserve fund needs to remain so the district can meet financial requirements and so unexpected cash flow interruptions throughout the school year (for example, delayed payment of levy dollars to the district, which it reports happened six times last year) do not halt operations.

Levy lids

Maiocco told school board directors the deficit primarily comes from legislative restrictions to the school enhancement levy, that was voted on in the February 2019 special election. The local levies are capped, preventing the district from collecting $15 million of the $55 million that voters approved for 2019. About 18 percent of the school district’s budget is supported by local levies.

The cap on the levy is the lesser of $1.50 per 1,000 square feet or $2,500 per student in the district for 2019. In 2020, the cap will improve at $2.50 per 1,000 square feet.

“This newly imposed limit was disastrous,” Maiocco said.

Districts across the state have been announcing similar budget shortfalls and cuts, some also blaming the new set levy caps. Lawmakers, the Seattle Times Education Lab reported, consider pay hikes negotiated by districts for teachers in 2018 after the McCleary decision as part of the shortfall. Union representatives also questioned the school districts claims that a budget deficit was predicted in the near future last summer, and stated that the district was hyper-focused on the dip in levy funding.

The district’s other two levy’s, one being the November 2019 approved construction capital projects bond and the other a capital technology levy, cannot be used to reduce the deficit, and must be used for their voter-approved purposes, according to the district.

The 2019 enhancement levy is capped, but that and the bond are still linked as two items that will be raising King County property taxes in 2020, according to a King County Assessor news release Thursday, Feb. 13. The overall property tax collections will increase 13.7 percent.

Community input in February

Pattenaude ended a presentation on the budget to school board directors by saying the district is using the best information they have to make these projections, but funding changes from the state legislature could always impact these predictions.

The district is holding budget presentations 6:30 to 7:30, Tuesday, Feb. 25 2020 at Hazen, Lindbergh and Renton high schools:

•Hazen High cafeteria, 1101 Hoquiam Ave. NE, Renton

•Lindbergh High cafeteria, 16426 128th Ave. SE, Renton

•Renton High commons, 400 S Second St., Renton

“We need your help to (make reductions) as effectively as possible,” Maiocco says in the online presentation.

The district is taking community feedback on what items should be prioritized, the survey is available in English and Spanish. The webpage with the feedback form also includes more information on the budget cuts, including a 13-minute presentation from Maiocco. See it here. The district states on the webpage updates on the budget process will be added to the site.




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