“[Our] staff is starting to see for the first time some of our best and most talented educators are leaving and going to neighboring districts, ... and [we're] not in a position financially where [we] can do anything about that,” Chief Financial Officer Kris Lynn said at June 1 budget workshop.
For the 2019-20 school year, the budget will come in approximately flat, although a $4 million deficit was originally projected. The district had a few unexpected revenue sources this year as well as unexpected cost savings because of the COVID-19 shutdown, said Lynn, who took the position April 1.
“That should lessen the impact on the fund balance, ... [which is] always positive news,” Lynn said.
The preliminary budget deficit for the 2020-21 academic year is projected at $2.8 million. Lynn said that although costs are relatively flat for next year, MISD is missing out on some revenue sources. For one, it will not receive the fast growth allotment this year from the state, which accounts for about $2 million in additional revenue.
“We just missed it by a couple percentage points,” Lynn said.
The district also did not qualify for the new instructional facilities allotment it was receiving for the construction of Lake Creek High School and Oak Hills Junior High because those funds are only available for two years, he said. That was a loss of $400,000.
The other major issue is that MISD lags behind competitors in its teacher hiring salaries, Lynn said. Yet the district is unable at this time to afford a pay increase in 2020-21, he said.
The district spends about 80% of the budget on staffing, which is similar to other districts, Lynn said. However, MISD has outsourced a significant portion of its staff, such as cleaning crews, that other districts keep in house.
When these positions were included, MISD was budgeting significantly more on staff than comparable districts, Lynn said.
“[We] don’t have a stuff problem; [we] have a staff problem,” Lynn said.
Lynn said schools, teachers, administrators and staff have operated on a tight budget for years. Many campuses have generated additional funds through fundraisers in cases where their budgets fell short, he said.
President Jim Dossey suggested the district reallocate funds from other programs. The proposed budget does not have any programs cut, as those decisions would need to be made by the board, Lynn said, acknowledging several parents who had spoken up at the meeting to ask the board to not cut the district’s dual language program.
“Those are decisions that we as a group would have to discuss and make some hard decisions on as we move forward,” Lynn said.
He added that because of his late arrival, the board may not have time for those conversations before the budget is adopted.
“We may have to adopt a deficit budget as we move forward for next year,” he said. “As soon as we get to July 1, we can start looking at ways to correct the problem so we don’t have the same situation for 2020-21.”