Superintendent Jim Schlachter's
2017-18 Budget Message
May 11, 2017
2017-18 BUDGET MESSAGE
The annual Budget Message is designed to summarize the proposed budget being presented for your consideration. This narrative is intended to provide context to the development of our plans for the 2017-18 operation of the Gresham-Barlow School District, and the alignment of these plans to a balanced budget.
The 2017-18 Budget Message will provide an overview of the following topics:
1. Gresham-Barlow School District’s 2020 Vision
2. Budget Assumptions
3. Budget Support for District Vision
4. Grants Supporting the District Vision
5. High School Graduation and College and Career Readiness Fund (Meas. 98)
6. Looking to 2017-18 and Beyond
1. GRESHAM-BARLOW SCHOOL DISTRICT “2020 VISION”
The District’s mission, “Every student prepared for a lifetime of learning, career opportunities, and productive contributions to the community,” is supported by our vision as defined by seven strategic themes that guide the District’s work:
Teaching and Learning, Growth and Achievement for All — Engage every student in meaningful learning through high-quality, accessible instruction and relevant content
Equitable Outcomes — Reduce the achievement gaps by supporting and sustaining equitable opportunities for every student
College and Career Readiness — Improve and increase high school pathways to college and career options
Early Learning — Align practices and resources to support all students reading at grade level by the end of the 3rd grade
Class Size and Learning Environments — Strive to strategically reduce class sizes and improve learning environments
Community Partnerships — Enhance support for students and schools through parent, business, and community partnerships
Community Investment — Create a long-term, prioritized plan for enhancing and preserving the community’s facilities.
Our ability to prepare every student for success necessitates our alignment of attitudes and behaviors, and a unified commitment to promote, protect, and defend our vision for the future. The support that ensures that the District can deliver on “Every Student Prepared for Success” is defined by the plans put together by District leaders and District staff. These plans are present in the District’s Consolidated Improvement Plan, each school’s School Improvement Plan, the planning of the District’s Instructional Leadership Team, and the oversight of the Superintendent’s Cabinet. All District plans are supported by the 2017-18 budget as outlined in this Budget Message.
2. BUDGET ASSUMPTIONS
Revenue Assumptions: The Oregon Legislature has responsibility for establishing the K-12 education funding level for the 2017-19 biennium. As of May 11, 2017, our best estimate of the revenue available for 2017-18 is based on the following assumptions:
- The projected District Average Daily Membership Weighted (ADMw) will be approximately 14,448, down from 14,490 in 2016-17.
- The estimated Total Formula Revenue is based on the expectation of $8.1 billion identified to support K-12 education statewide with a 49%/51% split for the biennium.
- The District’s beginning fund balance as of July 1, 2017, is estimated at $12,100,000.
The legislature is currently considering the allocation of $7.8 billion to the State School Fund. If this occurs, the District will be faced with an additional $3 million reduction in both 2017-18 and 2018-19.
To address this shortfall, one or more of the following would be necessary:
- Additional staff reductions, resulting in higher class sizes and reduced opportunities for students; and
- Further erosion of reserves.
Expenditures Assumptions: The District’s anticipated expenditures will use a portion of the increased reserves in 2016-17 to support expenditures in 2017-18.
The following assumptions reflect the District’s 2017-18 expenditures:
- Salary and benefits based on contractual agreements for staff, including a Cost of Living Allowance (COLA), have not yet been determined. The District is currently engaged in negotiating collective bargaining agreements with the Gresham-Barlow Education Association (GBEA) and the Oregon School Employees Association (OSEA). Both agreements expire June 30, 2017.
- Public Employee Retirement System (PERS) rates are projected to increase significantly through the 2021 biennium, as determined by the PERS Board, beginning July 1, 2017, and continuing through June 30, 2019.
Note: The rate for Tier 1 and Tier 2 employees increases from 9.18% to 13.89% of eligible salary. The rate for the Oregon Public Service Retirement Plan (OPSRP) Tier 3 employees increases from 4.49% to 8.56% of eligible salary.
- Staffing will be reduced in response to the decline in enrollment, State School Fund inadequacy, reductions in Federal Title funding, administrative reorganization, and program changes.
- Non-staffing budgets that support curriculum adoptions will be reduced, as will the need for capital facility expenditures, due to passage of the capital improvement bond in 2016.
3. BUDGET SUPPORT FOR DISTRICT VISION
The District’s strategic themes define our efforts to achieve the District’s mission and vision for the future. The District’s ability to “prepare every student for success” is directly related to the effectiveness of the education plan that we support from year to year.
Informed by the District’s strategic themes and vision for the future, all
year-to-year adjustments are designed to preserve the core of what we provide our students.
In addition, the District’s vision is realized when we strategically invest resources in areas where the District’s efforts will increase student success. We also work to stimulate progress in the District’s instructional practices through the work we define as central to the District’s education plan.
Within this budget we have aligned budget decisions with the themes that define our vision. The notes below highlight areas where our budgetary decisions intersect with our efforts. It is important to note that the areas highlighted here do not all have significantly high fiscal impact. It is the combined impact of time, funding, and alignment to our vision that we look to realize significant results for our students.
Teaching and Learning, Growth and Achievement for All
Curriculum Implementation: Elementary math curriculum has been purchased this school year and will be in classrooms in the fall of 2017. The curriculum blends the use of text and digital resources. The cost of the elementary math adoption was $812,000. High school math curriculum was also purchased this year at the cost of $390,000, and will be in classrooms beginning September 2017. Professional learning and curriculum planning will be the largest budgetary factors for the implementation of both math curriculum adoptions. These will occur during the summer and into the next school year at the cost of approximately $30,000.
Technology: Technology infrastructure projects and the implementation of the Gresham-Barlow School District technology plan will continue, thanks to the support of our community in passing the 2016 capital improvement bond. Several infrastructure projects, as well as purchasing new devices for student and staff use, will begin in 2017-18. General operating funds will not be required to support these projects over the next few years.
Kindergarten and First Grade Class Sizes: The 2016-17 budget included expenditures that continued staffing for full-day kindergarten for the second year, along with instructional staffing that supported lower class sizes during the critical kindergarten and first grade years. As a result of the added staffing, our kindergarten and first grade class size averages were 22.9 and 25.4 respectively. 2017-18 enrollment projections and the related staffing budgeted will not sustain the class size averages realized over the past two school years.
Class Size and Learning Environments
Enrollment Adjustments: The 2017-18 budget will not support the staffing additions that were made in August and September of 2016. Enrollment projections will utilize the FTE budgeted in 2016-17, prior to additions made in the fall. Average class sizes in our elementary schools are projected to be 28.5. We are estimating kindergarten and first grade class size averages to be 25-27 students, and second through fifth grade class size averages to be 30-32 students. We do not anticipate any changes to middle school and high school class sizes. Core class size averages in grades six through eight will be approximately 28:1. Core class size averages in grades nine through twelve will be approximately 32:1.
Thanks to the support of our community, the District has begun implementing several aspects of the $291.17 million capital improvement bond approved in November 2016. The District also received an $8 million matching grant from the Oregon Department of Education. Planning efforts are underway for replacement and renovation projects at Gresham and Sam Barlow high schools, and for the replacement of North Gresham and East Gresham elementary schools. Currently, we anticipate completion of the high school work in 2020 and the elementary replacement schools in 2019. More details about all the projects can be found at www.gresham-barlowbond.org.
College and Career Readiness
- Career Technical Education (CTE) programs in high schools; and/or
- Access to college-level educational opportunities for students in high schools; and/or
- Drop-out prevention strategies in all high schools.
(Note: Additional detail on the decisions, processes and timelines that are necessary for the realization of the college and career readiness benefits are detailed in Section 5 of this budget message.)
4. GRANTS SUPPORTING THE DISTRICT VISION IN 2017-18 AND BEYOND
Mt. Hood Cable Regulatory Commission TechSmart Initiative – Year 2
The Mt. Hood Cable Regulatory Commission (MHCRC) approved a $1.37 million grant for Gresham-Barlow School District through its TechSmart Initiative program in April 2016. The focus of the grant is K-3 Technology Integration, and leverages the $1.37 million over four years to create technology-rich, blended learning for kindergarten through third grade classrooms in North Gresham and Kelly Creek elementary schools. Instructional technology classroom hardware was installed in each classroom, and student devices were ready when the school year began.
Teacher training has been ongoing throughout the year, supported by Technology Instructional Coaches at both pilot schools. Embedding the use of technology into the teaching and learning structures will continue during the 2017-18 school year.
School District Collaboration Grant – Year 2
During 2015-16, the Gresham-Barlow School District was awarded a $50,000 School District Collaboration Design Grant to create blueprints for relevant professional learning, teacher leadership and effective evaluations, and compensation systems were designed.
During the 2016-17 school year, the District was awarded a School District Collaboration Grant in the amount of $1,025,000. Committees were formed to conduct research and begin a three-year implementation of the plans created the previous year. It is anticipated that a similarly-sized grant will be awarded to the District to continue this work in the 2017-18 school year.
The 2016-17 Title 1A allocation was $2.9 million, of which $2.4 million was allocated to nine elementary schools. The State's percentage of Title 1A dollars from the Federal Budget will be smaller for the next biennium. Additionally, the Multnomah County census reflects that poverty has declined; therefore, Oregon Department of Education's estimated scenario for the District’s Title 1A budget for 2017-18 is a decline of approximately 20% ($600,000) for the Title 1A budget.
The impact for the General Fund for the 2017-18 school year is the transfer of 1.0 FTE Instructional Coach from the Title 1A budget to the General Fund. Additional adjustments to individual school Title 1A budgets are being considered through this spring.
5. HIGH SCHOOL GRADUATION AND COLLEGE AND CAREER READINESS FUND
Established by Section 1, Chapter 1, Oregon Laws 2017, and referred to as Measure 98 on the November 2016 ballot, the High School Graduation and College and Career Readiness Fund must be supported by the budget to be passed during the 2017 Oregon Legislature’s regular session. Following budget adoption, the Oregon Department of Education shall determine the amount of funds to be apportioned among the eligible school districts and charter schools for each year of the biennium using the most current finalized extended ADMw from the State School Fund. Funds from the first year in the biennium may be carried over and used in year two.
Funds received by a school district or charter school must be separately accounted for and must be used in accordance with the school district or charter school’s approved biennial plan.
For the school year 2017-18, to be eligible to receive an allocation from the High School Graduation and College and Career Readiness Fund, a school district or charter school must have submitted a written request to the Oregon Department of Education. For the school year 2018-19 and biennia thereafter, to be eligible to receive an allocation from the High School Graduation and College and Career Readiness Fund, a school district or charter must prepare a biennial plan that meets requirements detailed under OAR 581-013-0025 and receive Oregon Department of Education approval.
The District is currently engaging stakeholders in formulating a 2017-18 Oregon Department of Education request. A biennial plan will also be developed to guide the effective use of the funds designated for use in 2017-18 and those carried over to and received in 2018-19.
6. LOOKING TO 2017-18 AND BEYOND
2016 Bond Oversight: The District has advertised for and is currently seeking membership to serve on the Citizens Bond Oversight Committee. Board selection of committee members will occur in the next month or two, and oversight work will begin shortly thereafter.
PERS Projections: The actuarial unfunded liability of the PERS system has been a hot topic in the State of Oregon. Based on recent actuarial projections, contribution rates will continue to increase over the next few biennia unless significant changes are made to the existing system, or extraordinary rates of return are achieved. For this reason, the 2017-18 budget creates a PERS reserve based on wages paid. The anticipated amount of the reserve is approximately $1 million for the fiscal year.
Outdoor School (Measure 99): Measure 99 that provides support for Outdoor School will likely not be funded until 2018-19. There will be no impact on the 2017-18 budget. We look forward to added resources in this area to have a positive impact on the 2018-19 Gresham-Barlow School District budget.
Informed by the District’s strategic themes and vision for the future, the 2017-18 budget has been designed to preserve the core of what we provide our students by sustaining the staffing we currently have in place to serve our 11,500 students. In addition, the District’s vision is supported as we strategically continue our investment resources in student opportunities that were missing for a number of years and have been restored. We also endeavor to stimulate progress in the District’s instructional practices through our investment in professional development targeting support for our recent curriculum adoptions. Two large grants, both of which are now in the second year of implementation, will also stimulate progress for years to come as we evaluate improvements in the use of technology in instruction, and deepen the collaborative work of our teacher-leaders.
As clearly spelled out in our revenue assumptions, this budget will meet these expectations.
The preparation of the 2017-18 budget has been a multi-month effort by members of the Superintendent’s Cabinet. Included in this process was the important work of aligning our efforts to the 2020 vision with status quo resources and continued legitimate demand for support in staffing and resources.
Mike Schofield, supported by his outstanding staff in the business department, has been the primary leader in the collection and organization of projected revenues and proposed expenditures. Mr. Schofield will continue to work on the 2017-18 budget as our revenue picture solidifies.
Finally, I thank the members of the Gresham-Barlow School District budget committee for their work and ongoing efforts to review the proposed budget and assist in the planning of resources that support the District’s mission and vision for the future.
GRESHAM-BARLOW SCHOOL DISTRICT
View the proposed 2017-18 Budget