The Eagle County School District adopted its budget for the coming school year at the June 24 Board of Education meeting. The impact of the prolonged shutdowns across the state dramatically reduced funding for public education.
The school district’s budget stabilization reduction more than doubled, from a $4.6 million subtraction last year to $9.6 million being subtracted this year. In addition, the state’s share of funding declined nearly $4 million ($3.9M). The school district’s conservative planning and spending, plus the consolidation of an east end elementary school have allowed the district to adjust while preserving current staffing levels. COVID-19 related stimulus funding is earmarked for COVID-related expenses and cannot be used to backfill budget shortfalls. The district’s operational budget is down a total of $3.9 million, a 4.5% reduction.
“The amount subtracted by the budget stabilization factor is the largest it has ever been, exceeding the annual reductions from the previous recession,” explained Chief Operating Officer Sandy Mutchler. “The way in which TABOR works means it will take a decade or more to return to last year’s funding level and we will never see the $75 million taken from our funding since the 2009-10 school year.”
The budget stabilization factor is an accounting tactic that state legislators invented during the recession that started in 2008. The School Finance Act and Amendment 23 create a funding formula that determines each school district’s per pupil revenue level. When the prescribed amount exceeds the state’s investment threshold for public education, it subtracts the amount it withholds. The amount on a statewide level exceeds $1 billion since the recession. The amount withheld from Eagle County School District is $75.9 million.
The 3A mill levy passed in 2016 by local voters helps offset the state’s decline in funding. When passed, the mill levy included a sunset in 2023, in part because it was thought state funding would stabilize and return to pre-recession levels. Unfortunately, the opposite is happening. The philosophy at the state is to shift more of the funding requirement to the local level. Prior to the COVID-19 crisis, several bills had been introduced for mill levy standardization and maximization.Currently, a few initiatives, endorsed by the Board of Education, are up for voter consideration that could help stabilize public education funding.
“To balance our budget, all departments in the district reduced their budgets by an average of twenty percent,” Mutchler said. “We consolidated an east end school, adjusted policy on our required reserves, delayed or suspended programs and projects, and managed to maintain staffing levels. These are significant belt-tightening measures.”
The budget includes the annual negotiated agreement with the Eagle County Education Association as required by the collective bargaining agreement. In the agreement, staff contributions to PERA increases by 1.25%. To offset this increase, staff pay will increase 1.9% (the Consumer Price Index of Denver) which keeps take home pay fairly even with last year. The district will also have increases in the employer PERA contribution share and will absorb any increase in insurance expenses.
Government entities use fund-based accounting principles where each fund is designated for a specific purpose. The General Fund includes the on-going operational expenses of the district and is the focus here.