State holdback forces school cuts

The 2.5 percent holdback of state funds, ordered by the governor this month due to much lower than anticipated tax revenues, will cost the Mountain Home School District approximately $412,000 this year, local district officials say.

That's putting the district in a serious financial crunch that could have major consequences if the Idaho Legislature doesn't dip into its "rainy day" contingency fund quickly when it meets in session in mid-January, to provide schools around the state with money to make up the shortfall.

"This school board has traditionally asked for tax dollars to cover expenses, and not taxed patrons to build up a huge contingency fund," explained Supt. Jerrie LeFevre, "so we don't have a lot of money available to cover this shortfall."

LeFevre said the district isn't panicking yet, hoping the Legislature will come through with extra funds, "but if they don't, we're going to have some serious problems," he said.

The district receives about $18 million in state funds out of its $22 million budget each year. The rest comes from local property taxes, direct federal support of specific programs, timber sale money and Impact Aid Funds designed to compensate the school district for students of military personnel who live on base and do not pay property taxes.

But due to the 9/11 crisis, no Impact Aid Funds, expected this year to be about $2.5 million, have been allocated. Normally, those funds arrive about this time of year and without them "the district is facing a cash-flow problem," Supt. Jerrie LeFevre said, which may force it to issue warrants -- tax anticipation notes -- to cover its expenses in December and January.

In addition, timber sale revenue has declined over the last decade from about $500,000 annually to about $80,000 this year, due in large part to restrictions on logging imposed by environmental lawsuits and federal policies.

At the same time, unfunded mandates by the state legislature, in particular requirements for expanded curriculum needed to meet state testing programs and increased graduation requirements, have added to the financial burden of the district, which increasingly, taxpayers are being asked to shoulder through property taxes.

But LeFevre said local taxpayers simply don't have the capacity to make up the funding shortfall created by the holdback.

The district is not looking at cutting teaching staff -- yet. "If we take another hit (after the legislature completes its education budget), and I'm hearing anything from zero to ten percent, then next year things could get really tough. We'd probably have to lose a few teachers, which we'd probably do through normal attrition, simply not hiring replacements. But I hope we don't have to get to that point."

In order to meet the funding shortfall in the short term, the district has ordered staff and administrators to cut back on supplies and services.

"Right now, 82 percent of our budget is tied up in salaries and benefits. We're locked into those contracts with the teachers, but not the support staff."

That means less paper will be bought, ink cartridges and ribbons for printers won't be purchased as often as they are now, the bands and choirs won't be buying new music, and the biology classes won't be getting frogs for dissection. In addition, some janitorial functions and supplies will be cut back.

"It's going to be quite a knock on our classrooms and custodial services," LeFevre said.

The district averages about $274,000 of spending a month for supplies.

"Can we do it? Yes," LeFevre said. "Will it have an effect in the classrooms? Yes.

"The science and health programs have already been cut by $50,000."

LeFevre said that so far, students haven't seen too much of the impact.

"I tell you, what's going to happen is the teachers are going to dip into their own pockets to make up the shortage in some of the supplies. This district is focused on providing quality education for our students, from top to bottom, and that isn't going to go away."

Teacher union president David Phillips agreed. "I've talked with Jerry and we'll do everything we can to work together. We're both in it for the students."

At the same time, he said, "I can tell you that all the staff are very concerned that the quality of education could go lower, that this could hurt the district.

"We don't have the funds balance a lot of other schools have. This district has done a pretty good job of utilizing funds to educate kids.

"If the legislature decides we're going to have to come up with money on our own, we're going to be hurt. If we can't equip classes properly, we're going to have trouble meeting (the new state) standards, and class size is going to become an issue," Phillips said.

"I know everybody (in the state) is taking a hit, like the corrections department, but, if we don't educate our kids right, now, we're going to need more corrections funds in the future.

"The greatest resource we have is the kids in school right now."

Furthermore, he said, "personally, I've got some problems with spending millions on renovating the state capitol while cutting education.

"The legislature put us in this predicament, and we're all paying for it."

School Board Chairman Jim Alexander was sharply critical of the legislature's lack of foresight that he said caused the problem.

"This was a classic case of looking at a piece of paper instead of listening to the people in the districts," he said.

"They kept saying the economy was doing fine, and cut taxes, while the people on the street were saying the exact opposite. So suddenly the state's out of money and we're the one's paying for it."

Alexander said he expected the legislature "to make a good-hearted attempt to release its 'rainy day' money to the schools, but that's one-time money and can't solve the long-term problems.

"Right now, we're up to our eyebrows in unfunded mandates from the state (to expand curriculum and reduce class sizes). Improving education is a noble concept, but if the money's not there it's time to back off and let things recover" before pushing the district to do more with less.

In order to meet the new educational requirements being phased in over the next four years, school districts like Mountain Home will have to increase electives available to students.

Yet, if the funds aren't available by next year, some programs may have to be cut and the teaching load realigned, said MHHS Principal Barry Cahill, who noted that core classes must have priority over electives.

One program already has bit the dust.

After years of work the district was anticipating launching an Air Force Junior ROTC program next fall, which would add a science (aerospace education) and PE elective available to students. Students would have to register for it at the end of January.

But with future funding uncertain, the district simply couldn't justify the $40,000 start-up cost while potentially asking other programs to take cuts. Since the legislature is unlikely to make a decision on current and future funding by the time of registration for next fall, that program has been put on hold.

"The legislatue has an opportunity to fix this," Cahill said. "Currently, we're in about a nine-week tread water period. That's why its a holdback, not a cutback, and it's why we've chosen not to take drastic measures yet."

"We're hurting," LeFevre said. "We're all about improving student performance. "We're not here to make excuses.

"I think our staff and patrons have a lot of confidence in the school board, so we're not going to be shivering with fear."

But all of the district officials interviewed agreed, if the legislature doesn't act quickly in January to dealt with the short term problem, and provide adequate funds for next fiscal year to deal with the long-term problems, some drastic measures will have to be taken.

"Right now, I wouldn't want to be an administrator in this district, trying to plan for next year," said Phillips.