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HomeMy WebLinkAboutMinutes 20090428 1 APPROVED 6/16/2009 MINUTES Orange County Board of Commissioners Orange County Board Of Education Chapel Hill-Carrboro Board of Education WORK SESSION April 28, 2009 7:00 p.m. The Orange County Board of Commissioners met for a joint session with the Chapel Hill—Carrboro Board of Education and the Orange County Board of Education on Tuesday, April 28, 2009 at 7:00 p.m. at the Southern Human Services Center in Chapel Hill, North Carolina. COUNTY COMMISSIONERS PRESENT: Chair Valerie P. Foushee, and Commissioners Alice M. Gordon, Barry Jacobs, Pam Hemminger, Mike Nelson, Bernadette Pelissier, and Steve Yuhasz COUNTY COMMISSIONERS ABSENT: COUNTY ATTORNEYS PRESENT: John Roberts COUNTY STAFF PRESENT: County Manager Laura Blackmon, Assistant County Managers Willie Best and Gwen Harvey, and Clerk to the Board Donna S. Baker (All other staff members will be identified appropriately below) ORANGE COUNTY BOARD OF EDUCATION MEMBERS PRESENT: Chair Steve Halkiotis, Vice-Chair Tony McKnight, and Board members Eddie Eubanks, Anne Medenbleck, Debbie Piscitelli, and Superintendent Patrick Rhodes were also present. ORANGE COUNTY BOARD OF EDUCATION MEMBERS ABSENT: Ted Triebel and Susan Hallman CHAPEL HILL-CARRBORO CITY SCHOOL BOARD OF EDUCATION MEMBERS PRESENT: Chair Lisa Stuckey, Vice Chair Mike Kelley and Board Members Jamezetta Bedford, Mia Day Burroughs, Jean Hamilton, Gregory McElveen, Annetta Streater, and Superintendent Neil Pedersen was also present. CHAPEL HILL-CARRBORO CITY SCHOOL BOARD OF EDUCATION MEMBERS ABSENT: Introductions were made. 1. Opening Comments OCS Board Chair Steve Halkiotis made comments about the economy and its impact on the schools. He said that he is worried about how all of the cutbacks will affect the high-risk children. He said that the school board is advocating for all the children tonight. 2. Orange County Schools Superintendent Patrick Rhodes made a PowerPoint presentation. a. Presentation of FY 2009-10 Board of Education Approved Budget Orange County Board of Education's Requested Local Appropriation 2009-2010 April 28, 2009 2 Current Budgetary Environment - Probable 5-7% reduction in state allotments - County Sales Tax Revenues are down - Property Tax Revenues are down - County Debt Service has increased - Increased OCS contribution requirements for health care and retirement State Budget Reduction Highlights A comparison of Proposed Budget Reductions: - Governor Perdue—5% Reduction - $1.6 million - N. C. Senate —7% Reduction - $2.5 million - N. C. House—7%+ Reduction Impact of the Senate's Budget on OCS: Classroom Teacher Reductions Grades K-3 = 11.5 positions Grades 4-6 = 6.0 positions Grades 7-8 = 4.5 positions Grade 9 = 2.0 positions Grades 10-12 = 4.0 positions 28 Total Further Senate Reductions: - SRO Funding $37,000 per high school - School Technology $270,000 reduction - Textbooks $234,000 reduction - "At-Risk" Funding $332,787 reduction Revenue Sources for 2008-09 Local appropriations—37% - $25.3 million State Funding —58.9% - $40.2 million Federal Funding —4.1% - $2.8 million Total OCS Operating Budget -$68,259,202 3 Most OCS Funds are Invested in Our People Salary and Benefits —83% Purchased Services—9% Supplies and Materials—7% Instructional Equipment - 0.4% Other Goods and Services—0.6% How Local Funds Are Used in Schools - Instructional (school-based)—55% - Business Support Services—27% - District Instructional Support Staff—4.8% - Central Support—4.8% - Other Support—4% - Community Programs— 1% - Charter Schools —3.4% Budget Year 2008-2009 Spending Cuts During our most recent budget cycle, the Orange County Board of Education reduced spending by $1,579,934 (6.2% of the local budget). 2008-2009 OCS Budget Reductions The major reductions are summarized below: - 6.5 District-level Positions $385,000 - 10 School-level Positions $209,000 - Programmatic Reductions $461,000 (Non-personnel) - Miscellaneous District-level Funding $179,000 Lean Staff—Simple Form In order to obtain the best possible return on investment, the district has reduced spending by the following actions: - Redesigned departmental work flow to eliminate redundancy - Reduced, realigned or consolidated positions - Reallocated staff for greater efficiency and improved service delivery 4 2009-2010 Local Expense Budget Over the course of the last 10 months, Orange County Schools has taken steps to reduce local spending by $2,553,912. Total Recommended Budget: $23,841,004 This recommended budget represents a 3.5% reduction in county appropriations and a 1.9% decline in other revenues. Requested County Appropriation: $22,320,459 This request represents a reduction of$973,973 or a decrease in funding of$139.00 per student compared to 2008-09 levels. Orange County Schools Per Pupil County Appropriation (bar graph) County Appropriations year to Year Comparison (bar graph) 2009-2010 Projected Budget The requested level of funding will allow the district to provide services for our most vulnerable students and fill the gaps created by the $332,787 reduction in state "at-risk" funding. How will Orange County Schools absorb a reduction of$1,409,796 in local revenues in order to provide a balanced budget? Executive Staff conducted a detailed evaluation of the 2008-09 budget: - Line by line review of expenditures (p. 31 has a list of specific reductions) - Full review of all audit reports - Preliminary state allotment sheets - County Government Projections - The Governor's proposed Budget - Other revenue sources District-wide and Administrative Reductions: Reduce: - District-level clerical - Paid Assistant Coaches - Assistant Principal months of employment - Substitute Teacher Days 5 - Exceptional Children Salaries (use Fed. Stimulus funding) - CTE Clerical Support (50% to CTE Budget) Eliminate: - 2 Coordinator positions - Energy Management position (reassigned duties) - Permanent Substitute positions - Lead Nurse position - District Clerical position - Psychologist position Program Support Reductions: Reduce: - C and I supplies - Supply purchases - Local workshop allotments - Principal travel allotments - Allotment for diesel fuel - Vocational Travel - Charter School payments Eliminate: - Travel reimbursements - Tuition reimbursements - Recruitment incentives - Teacher voucher program - Transfers to Child Nutrition - Human Resources Budget Items - NC Wise Conversion Budget Payroll Related Reductions: Reduce: - Overtime payments - Athletic Supplements (use 08-09 rates) - Co-curricular Supplements (use 08-09 rates) - Freeze all administrative, teacher and classified supplements School-level Programmatic Reductions: 6 Reduce: - Under enrolled Middle School French Program - Elementary Spanish program funding - Guidance supplies - AIG Staff Development - K-8 Teaching Assistants Eliminate: - OHS Dean of Students position - Middle School MSEN b. Presentation of Prioritized FY 2009-10 Capital Investment Budget Capital Investment Plan - 10-Year Projection - Assessments Based on Unconstrained Resources - Inputs o Board of Education o Superintendent&Associate Superintendent o Principals o Maintenance Director o Strategic Plan Ages of School Facilities School Year Opened Cameron Park 1956 Central Elementary 1952 Efland-Cheeks 1952 Grady A. Brown 1974 Hillsborough Elementary 1952 New Hope 1991 Pathways 1991 A.L. Stanback 2000 C.W. Stanford 1995 Gravelly Hill 2006 Cedar Ridge 2002 Orange High 1962 7 Partnership Academy 2007 Average age of OCs buildings: 30.8 years old Capital Funding History School Year Capital Investment Plan Recurring Capital 2009-2010 $1,647,118 $1,088,193 2008-2009 $2,281,700 $991,630 2007-2008 $1,547,986 $956,600 2006-2007 $814,272 $921,570 Financial Stewardship The district is committed to minimizing the effect of the budget cuts on classroom instruction and efficiently utilizing all available resources in order to provide our students with an outstanding educational experience. Debbie Piscitelli said that the OCS Board believes that the Board of County Commissioners values education. As a school district, she said that they educate any child that shows up at the doors. If there are special needs, the school district meets that responsibility. She said that there is such an array of needs in the district and it takes money and people to meet those needs. Eddie Eubanks said that one of the elements involved in reductions are those that affect those who are most unable to take care of themselves in society, and we should not balance the budget on the backs of these individuals. Steve Halkiotis said that he believed the Governor when she sent a letter saying that there was recovery money coming to help the schools. Now there is a CEO of Education who has sent a letter saying the same thing. He said that the letters stopped coming since the money is so tied up in federal red tape and the schools may never see any of this federal money. He asked the County Commissioners to help any way they can, because there will not be any help from Raleigh this year. He said that he believes that the Legislative Delegation, State Senator, and the Representatives really care, but they cannot make it by themselves. Commissioner Jacobs said that the County Commissioners have already said that it is their intention to maintain the social safety net. He said that he sent an email to the Board of County Commissioners about the funding direction of the State Senate, which is to take away all reimbursements from the counties, including eliminating reimbursing county governments for sales tax. He said that this may not be the low point yet. Commissioner Jacobs made reference to the policy about recurring capital, which can be amended. He said that if the County could not change the per pupil, then the funding 8 formula for recurring capital could be amended, even if it is just for one year. He suggested that the school board think about this. Lisa Stuckey said that CHCCS does not want to go down that road now and Steve Halkiotis said that the OCS Board would discuss this at its next meeting. 2. Chapel Hill Carrboro City Schools a. Presentation of FY 2009-10 Board of Education Approved Budget b. Presentation of Prioritized FY 2009-10 Capital Investment Budget Budget Presentation to the Orange County Board of Commissioners Chapel Hill-Carrboro City Schools April 28, 2009 Lisa Stuckey, Chair, Board of Education Neil Pedersen, Superintendent Overview of Presentation •2009-10 Operating Budget Request *Implications of the Senate Budget *Plans for Additional Budget Reductions *Federal Stimulus and Stabilization Funds •2009-19 Capital Investment Plan •Prioritization of 2009-10 Projects in CIP *State Freeze on New Expenditures Guiding Principles •Base decisions on our strategic plan •Increase cost-effectiveness •Retain resources directly associated with quality of education •Transparency and open communication •Eliminate ineffective programs •Provide safety net for parents 2009-10 Operating Budget Request •Budget is based on 21 more in-district students •Net increase in local revenues is $83,517 (based on 1% increase in district tax base) •Net increase in expenses is $801,797 •Shortfall is $718,280 •Only increased costs are for: -Health Insurance ($235,538) -Retirement ($98,400) -Child Nutrition Services ($140,350) -Step Increases for local teachers and principals ($406,970) 9 Capital Investment Plan *Elementary No. 11 •Carrboro Arts Wing •Lease purchase of telephone system *Prioritized projects for 2009-10 Quality Schools are Essential to Orange County's Future Revenue Explanation •Our request is based on the same County Appropriation as this year ($37,456,007) •We understood that we should plan for a 1% increase in the tax base for the district tax. District tax revenues would be $186,010 more than last year. •If the new district tax rate is revenue neutral, instead of a net increase in local revenues of $83,517, we will have a net decrease of$102,493. Reductions Required to Balance Budget Request •10% Reduction in non-personnel allocations for central office ($250,000) .5% Reduction in central office salary line ($200,000) •10% Reduction in non-personnel allocations for schools ($144,000) •5 Days reduced from teacher assistants' contracts ($101,188) •Four bus drivers lose clerical positions in middle schools; reduced to part-time ($74,340) Highlights of Senate Budget •7.5% reduction in K-12 funding •Increases class sizes by 2 students in grades K-12. Would eliminate 48 teacher positions. •Cuts $124.5 million (over two years) from Public School Building Fund •Reduces LEA flexibility reduction from the $144 million proposed by the Governor to $9.4 million •Includes step increases for teachers only, no ABC bonuses, but continues longevity payments •Reduces central office allocation by 5.3 percent ($6.5 million) •Eliminates funding for student accountability •Reduces funding for technology, staff development, textbooks, testing •Reduces $40 million from More at Four and moves it to HHS •Cuts 277 (of 475) positions from DPI over two years •Net Reduction to CHCCS is $3,436,506 in operating budget alone. Prioritized Categories for Reductions that have been Suggested (priority approved by Board on April 2) •Additional Central Office Reductions •Increases in Class Size— Limited, if any, Non-Renewal of Staff •Increases in Work Load of Staff with Non-Renewal of Some Staff •Reduction in Instructional Services/Programs with Non-Renewal of Some Staff •Salary Adjustments 10 Central Office Reductions •$250,000 already reduced in budget request. Further reductions are being considered in the following areas: •Professional Development Services •Surveys •Discretionary Local Assessments •Teacher Recruitment •Signing Bonuses for Teachers in Hard to Fill Areas •Tuition Reimbursement for Teachers •Publications •Instructional and Management Software •Permanent Substitutes •IP Telephony •Contracted Services •Use of Substitutes Increases in Class Size •Allocate elementary teaching positions more rigidly •Adjust high school allotment formula (Increase of approximately 1 student per class saves 8 FTE across the three high schools) •No further middle school reductions are proposed at this time due to reduction of 8 FTE due to core teachers teaching five sections. •Note: These savings could be negated by reductions made at the state level Increases in Work Load of Staff •Elementary art and music allocations •Gifted Specialists reduced from 1.5 to 1 per school •Middle School core teachers teaching 5 periods •High school media center staffing •High School CIC allocation •High School Athletic Directors teaching 2 periods •High School Department Chair allocations •Elementary teacher assistants •Literacy coaches (reduce from 2 to 1 in some or all schools) Reductions in Instructional Services/Programs •Eliminate elementary world language in k or k-1 •Reduce Gifted Specialists from 1.5 to 1 per school •Reduce scope of summer school •Assign teacher assistants to Middle School ISS •Reduce Middle School after-school and/or transportation for this program •Reduce Service Learning/Project Graduation support •Middle College High School •Reduce funding for high school reforms •Reduce funding for high school academies •Reduce number of student assistance counselors •Reduce funding for middle and high school athletics •Eliminate dual language program in middle schools Salary Adjustments 11 •Reduction in local supplements for all staff by 1% •1% Reduction of salary across the board •Reduction in contract length of some administrators •Furloughs for some administrators and some classified personnel •Local cost for longevity payments would decrease if state places moratorium on longevity payments Five Reduction Scenarios •Reductions range from $2.5 million to $4.5 million (legal-sized paper) Federal Funds •Stimulus Funds -District's Title I funds increase by $623,000 -District's IDEA funds increase by $2.2 million -Categorical funds for specific purposes -One-time funding intended to improve education and create jobs -May be able to replace some positions lost to budget cuts that would have been eligible for funding under Title I or IDEA •Stabilization Funds -Currently, unclear if districts will see these funds or if they will be kept in Raleigh to reduce magnitude of budget cuts. 82% must go to education. Capital Investment Plan •$2,664,709 in Pay As You Go Funding •The status of lottery funds is uncertain at this time ($1,365,000) •Roofing bids came in 30% below estimates; therefore, able to do more projects •Board has reprioritized projects that can be funded through Pay As You Go. Major Prioritized PAYG Projects •Asbestos removal at Phillips and FPG •Roof replacements: Lincoln, Seawell, Carrboro Elementary •Window replacement at Lincoln •HVAC units at Phillips •IAQ - carpet replacement •Access controls •Technology (including IP telephony) IP Telephony Lease Purchase *Replace phones in 12 locations to provide consistent phone service across the district to protect the safety of staff and students •Savings of$85,430 over incremental purchases *Annual operational savings of$59,836 *Sales tax reimbursement is $20,289 12 State Cash Flow Emergency •State funds cannot be used to —Fill vacancies other than teachers and principals —Pay for goods not received as of April 16 —Travel within or outside of the district •Local costs cannot be transferred to state budget codes •District is following similar rules for local funds •Today, Governor Perdue announced that state employees will be furloughed and their annualized salaries will be reduced by 0.5% for remainder of the year. Gregory McElveen commended the Board of County Commissioners for all the monies that have been committed to the Town and the County and trying to maintain a revenue neutral funding. He suggested that the Board maintain the policy of the revenue neutral funding. Jamezetta Bedford said that she supports Commissioner Jacobs' suggestion about having the flexibility to use recurring capital. She said they are doing tiers of cuts because of the severity of cutting jobs. She said that if the target of 48.1% includes no debt service, then the capital side needs to be more equitable between the districts. She said that her understanding is that when a school has to be built, either private debt or bonds have been issued and the County has funded this separately. She said that she is telling the parents in her district that the Carrboro High Arts wing is #2 on the unfunded list. She said that the County Commissioners have told the school board the amount of money to be given, and the school board chooses how to spend it. She said that they need clarity on the process and the amount for the Carrboro Arts wing. Chair Foushee said that, fundamentally, it has a lot to do with the County's debt policy and the ability to borrow money. Commissioner Nelson said that he was equally confused about getting emails from CHCCS parents about the arts wing, and the County is looking at reductions too. He said that he needs guidance from the CHCCS as to the priorities on the capital needs. Jamezetta Bedford said that Elementary#11 is number one, and the arts wing is number two. The list is in order. Commissioner Nelson said that the school boards will get a certain amount of money and it will be up to the school boards on how they decide to spend it. Donna Coffey said that funding for the pay-as-you-go projects will happen before the end of this fiscal year, probably in May or June. Funding for the lottery-funded projects will come when they hear from the State. Funding for the larger projects, or debt-financed projects, will come with the school district's CIP requests for next year. The issue for the County is that it will be close to its 15% debt capacity level. Discussion ensued about the County's debt ceiling. Commissioner Gordon said that the school systems should continue to advocate for what they need, but the County is at its debt capacity level. Anne Medenbleck said that the plans for Cedar Ridge High School also had another wing planned seven years ago that has not been built yet. 13 Commissioner Gordon said that, in terms of Elementary #11, the school board needs to calculate when the school needs to be built and the SAPFO will call for a plan to build it on time, and if it is not, there will be no CAPS issued for development. Commissioner Yuhasz asked about expansions to current schools versus new schools and Jamezetta Bedford said that they have looked at several elementary schools for this, but it costs more per pupil with an addition than it does for a new school. Commissioner said that the County Commissioners need to look at reducing debt services over time. Commissioner Jacobs said that CHCCS may want to look at worst case scenarios and address the arts wing at a lesser cost instead of building elementary school #11. He still thinks it is a great thing that there is $1 million in fair funding in the general fund and the County Commissioners are providing this so that every school has a nurse, SROs, etc. Superintendent Pedersen made reference to Elementary School #11 and said that the Board of County Commissioners did approve a site for this school and there is a preschool in this building that will have to relocate. The Board appropriated $1 million to CHCCS for planning, the school is well on the road to being designed, and the approval process is underway through the Town of Chapel Hill. This is a project that is under the "funded" projects and it needs to have priority over other projects. The County has an investment in this project and the school board members are not sure what they are to do and they need more discussion about the future of this project. Chair Foushee said that none of them want to change the direction for Elementary School #11, but as much as they want to see this constructed, the County's ability to construct that building is uncertain. Commissioner Yuhasz said that the County has funded the schools each year on the back of property taxes and funded to a higher level than it does for salaries and wages. He said that the County may have reached the end of that rope. Until another revenue source is found that relies less on residential property values, they may not recover from this economic disaster as quickly as was originally thought. With no further items to discuss, the meeting was adjourned at 8:44 p.m. Valerie Foushee, Chair Donna S. Baker, CMC Clerk to the Board