Who Is In Charge

Budget woes loom again for 2011-12

Legislators Monday got some modest good news about the 2010-11 budget but some sobering forecasts about 2011-12.

The good news is that the 2010-11 budget, which goes into effect July 1, probably won’t need further major cuts beyond a $75 million adjustment by Gov. Bill Ritter in order to keep the state’s reserve at legal levels.

Legislative economist Natalie Mullis
Natalie Mullis, legislative chief economist, briefed lawmakers June 21 on state quarterly revenue forecasts.

Ritter said Monday afternoon that he hopes K-12 funding and higher education can be spared from the $75 million trim, but said, “Nothing is off the table.”

The governor said, “I’m very hopeful” schools can be spared further cuts but added, “Where K-12 education becomes vulnerable again is if Medicaid is not extended.”

To help ease state budget woes, the federal government has been picking up a larger share of Medicaid costs than normal, but that ends in December. A proposal to extend the higher payments is facing tough going in Congress, particularly in the Senate. If the program isn’t extended, Colorado would have to scramble to come up with $245 million or make cuts to cover that amount.

“We’re watching the Medicaid situation closely over the summer,” Ritter said, adding he hopes things will become clearer before Congress’ August recess.

Ritter also said, “It’s our hope we don’t have to do anything to impact higher education again.” The $75 million is about 1 percent of the state’s general fund. Ritter promised a package of recommendations in August.

The bad news is that the 2011 legislature may need to make about $1 billion in cuts to the 2011-12 budget, depending on future levels of federal support for Medicaid; on inflation; on growth in the numbers of prison inmates, sick people, school kids and college students; and on how lawmakers decide to replace one-time sources of money that were used to balance the 2010-11 budget, such as federal stimulus funds.

“We have a pretty tough budget year ahead of us,” said Natalie Mullis, the legislature’s chief economist.

“It looks like we will another rough year in 2011-12,” agreed Lisa Esgar, deputy director of the executive branch’s Office of State Planning and Budgeting.

Because state support for K-12 schools and higher education spending consumes nearly 40 percent of total state spending and more than half of the tax-supported general fund, any cuts are expected to fall heavily on education.

Some legislative leaders previously estimated that K-12 and higher ed could see cuts of $300 million each in 2011-12.

The two revenue forecasts released Monday offer no detailed hints of what education cuts might look like – it’s much too early in the game for that.

Here’s the overview of the budget situation:

2009-10: The state will end the year on June 30 in the black, but the reserve will be $51.7 million less than the required $132.6 million. (The OSPB estimates the reserve shortfall at $74.5 million.) The shortfall doesn’t have to be covered before the end of the year and can be rolled into 2010-11.

2010-11: Sufficient revenues are expected to cover the spending approved by the 2010 legislature, but again the reserve will fall short of required levels. Legislative Council staff estimate about $37 million will be needed to return the reserve to an acceptable level. (OSPB projects a higher number.)

2011-12: In addition to another $61.4 million reserve shortfall, lawmakers will have to replace (or cut) $617 million in one-time funds and cover (or ignore) an estimated $300 million in caseload increases. That makes up the $1 billion.

Some observers think the shortfall could be larger noting, for instance, that school districts’ local revenue likely will decline for 2011-12, putting pressure on the state to cover the difference.

The $1 billion figure didn’t come as a major shock. “This wound up not surprising us a great deal,” Ritter said. Informal estimates in that ballpark were circulating during the closing days of the 2010 session, which adjourned May 12.

But, Monday’s release of the formal quarterly revenue forecasts by legislative staff and OSPB mark a key point in the 2011-12 budget process and begin to focus the issue for legislators.

Gov. Bill Ritter
Gov. Bill Ritter discussed the state budget situation during a news conference June 21.

Executive branch departments already are refining their 2011-12 requests, another set of forecasts will be issued in late September and Ritter has to submit his 2011-12 budget to the Joint Budget Committee by Nov. 1. The panel will hold budget hearings in November and December, and another set of forecasts in late December will update the situation just before the 2011 session convenes.

The national recession began affecting state government in 2009-10 budget year, which is about to end. Lawmakers last spring had to make significant mid-year adjustments in spending, including a $130 million cut in K-12 support. Creation of a balanced 2010-11 budget required significant cuts and revenue shifts.

Overall, there have been $3.5 billion in state budget cuts and adjustment over three fiscal years, Ritter noted.

Total program spending for K-12 schools was about $5.4 billion in 2008-09 and was supposed to rise to nearly $5.7 billion this year, before the midyear adjustments trimmed it back to just under $5.6 billion.

Using a narrow interpretation of the Amendment 23 school-funding formula, the legislature approved about $5.4 billion in total program funding for 2010-11. Full A23 funding would have been about $5.8 billion. The 2010 school finance law recommends the same $5.4 billion figure for 2011-12, although that can be changed by the 2011 legislature.

(Total program funding is the amount of state aid and local revenues used for basic classroom and administrative operations. It doesn’t include additional state aid for such things as transportation and special programs, some federal programs and district revenues from bond issues.)

School districts have responded with layoffs, wage freezes and other cuts of a magnitude Colorado schools haven’t seen in years. (See the One-Stop Budget Cuts Info Center for details.)

Spending at state colleges and universities was maintained at just under $2 billion for 2010-11 – but only with the help of significant federal stimulus support and 9 percent tuition increases for resident undergraduate students. Higher ed is seen as particularly vulnerable to cuts in 2011-12. Senate Bill 10-003, the major flexibility legislation passed last spring, requires colleges to prepare reports on how they would handle a 50 percent cut in state support. Those are due next autumn.

Both forecasts found some some signs of economic hope.

“Both Colorado and the national economy are embarking on a very delicate recovery,” said Kate Watkins, a legislative economist, during the morning JBC meeting where the forecasts were unveiled.

“While the economy is recovering, it is very slow,” Ritter said. “We do believe the economy will recover” in time for the 2012-13 budget year – long after Ritter has left office.

(Both forecasts provide a wealth of information about tax revenues and  the economy of the state and its regions. See below for links to the full forecasts.)

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Who Is In Charge

Indianapolis Public Schools board gives superintendent Ferebee raise, bonus

PHOTO: Dylan Peers McCoy
Lewis Ferebee

Indianapolis Public Schools Superintendent Lewis Ferebee is getting a $4,701 raise and a bonus of $28,000.

The board voted unanimously to approve both. The raise is a 2.24 percent salary increase. It is retroactive to July 1, 2017. Ferebee’s total pay this year, including the bonus, retirement contributions and a stipend for a car, will be $286,769. Even though the bonus was paid this year, it is based on his performance last school year.

The board approved a new contract Tuesday that includes a raise for teachers.

The bonus is 80 percent of the total — $35,000 — he could have received under his contract. It is based on goals agreed to by the superintendent and the board.

These are performance criteria used to determine the superintendent’s bonus are below:

Student recruitment

How common is it for districts to share student contact info with charter schools? Here’s what we know.

PHOTO: Laura Faith Kebede
Staff members of Green Dot Public Schools canvass a neighborhood near Kirby Middle School in the summer of 2016 before reopening the Memphis school as a charter.

As charter schools emerge alongside local school districts across the nation, student addresses have become a key turf war.

Charter schools have succeeded in filling their classes with and without access to student contact information. But their operators frequently argue that they have a right to such information, which they say is vital to their recruitment efforts and gives families equal access to different schools in their area.

Disputes are underway right now in at least two places: In Tennessee, school boards in Nashville and Memphis are defying a new state law that requires districts to hand over such information to charters that request it. A New York City parent recently filed a formal complaint accusing the city of sharing her information improperly with local charter schools.

How do other cities handle the issue? According to officials from a range of school districts, some share student information freely with charters while others guard it fiercely.

Some districts explicitly do not share student information with charter schools. This includes Detroit, where the schools chief is waging an open war with the charter sector for students; Washington, D.C., where the two school sectors coexist more peacefully; and Los Angeles.

Others have clear rules for student information sharing. Denver, for example, set parameters for what information the district will hand over to charter schools in a formal collaboration agreement — one that Memphis officials frequently cite as a model for one they are creating. Baltimore and Boston also share information, although Boston gives out only some of the personal details that district schools can access.

At least one city has carved out a compromise. In New York City, a third-party company provides mass mailings for charter schools, using contact information provided by the school district. Charter schools do not actually see that information and cannot use it for other purposes — although the provision hasn’t eliminated parent concerns about student privacy and fair recruitment practices there.

In Tennessee, the fight by the state’s two largest districts over the issue is nearing a boiling point. The state education department has already asked a judge to intervene in Nashville and is mulling whether to add the Memphis district to the court filing after the school board there voted to defy the state’s order to share information last month. Nashville’s court hearing is Nov. 28.

The conflict feels high-stakes to some. In Memphis, both local and state districts struggle with enrolling enough students. Most schools in the state-run Achievement School District have lost enrollment this year, and the local district, Shelby County Schools, saw a slight increase in enrollment this year after years of freefall.

Still, some charter leaders wonder why schools can’t get along without the information. One Memphis charter operator said his school fills its classes through word of mouth, Facebook ads, and signs in surrounding neighborhoods.

“We’re fully enrolled just through that,” said the leader, who spoke on condition of anonymity to protect his relationship with the state and local districts. “It’s a non-argument for me.”

A spokeswoman for Green Dot Public Schools, the state-managed charter school whose request for student information started the legal fight in Memphis, said schools in the Achievement School District should receive student contact information because they are supposed to serve students within specific neighborhood boundaries.

“At the end of the day, parents should have the information they need to go to their neighborhood school,” said the spokeswoman, Cynara Lilly. “They deserve to know it’s open.”