Budget Basics Preparing for the 2011 NC General Assembly Session

Situation Analysis NC budget shortfall of approximately $3.7 billion for the fiscal year. Cause: end of federal stabilization funds; end of some state taxes; end of nonrecurring cuts. Economic recovery continues to be slow.

Situation Analysis Public school budgets have been cut for three consecutive years. K-12 public education is the largest share of the state’s budget, so it’s tough to reach reduction targets without cutting public schools.

Situation Analysis

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How NC Ranks North Carolina ranks 45th in the nation in per-pupil spending.

Common Questions Why are schools always on the chopping block? NC’s Public School Fund is the largest chunk of the state budget’s General Fund.

Common Questions What about the lottery funds – won’t they help? Lottery funds do help – but they make up only about 3.9 percent of the budget. And, they’re designated for specific purposes – K-3 teachers, More at Four, school construction and scholarships.

Common Questions Can’t we just cut administration and leave teachers alone? Eliminating all administration (NCDPI, central office staff, principals/assistant principals) would total $478 million – less than half of the possible $1 billion in targeted cuts.

Common Questions Why not cut out testing? Wouldn’t that save a lot of money? Cutting out all testing would save about $11 million - far short of our needed cuts. Also, remember, NC is required to do some testing under federal and state laws.

Common Questions Won’t the federal Race to the Top funds help solve our budget problem? Race to the Top is providing nearly $400 million over four years to North Carolina - but the funds are targeted for specific purposes and not for general use. Funds are a one-time allocation.

What about KCS? Total KCS Budget = $47.5 million

What about KCS?

KCS ARRA Funding (Stimulus) KCS will lose nearly $2.5 million in ARRA funding for That equals positions. We will be able to absorb some of those positions by using other funding. However, it is an extremely significant loss.

How MIGHT state cuts affect KCS? 5% cut: 5% Reduction Estimated Allotments Reduction+/- 001 TEACHERS250 positions15 positions CENTRAL OFFICE $ 574,056 $ 28,703 $ 545, NON-INSTRUCTIONAL SUPPORT $ 1,417,211 $ 141,721 $ 1,275, SCHOOL BUILDING ADMIN162 months9 months $ INSTRUCTIONAL SUPPORT27 positions3 positions $ DRIVER TRAINING $ 96,522 $ - $ 96, VOC-MONTHS OF EMPLOYMENT245 months11 months $ VOC-SUPPORT $ 67,481 $ 3,374 $ 64, SCHOOL TECHNOLOGY $ 34,783 $ MENTORS $ 53,233 $ Disadvantaged Student Supplemental Funding $ 284,598 $ - $ 284, TEACHER ASSISTANTS $ 2,069,125 $ 783,982 $ 1,285, STAFF DEVELOPMENT $ 52,594 $ LOW WEALTH $ 249,814 $ - $ 249, EXCEPTIONAL CHILDREN $ 2,635,660 $ 89,612 $ 2,546, AIG $ 250,518 $ 12,526 $ 237, ESL $ 599,463 $ 59,946 $ 539, TRANSPORTATION $ 657,234 $ - $ 657, INSTRUCTIONAL SUPPLIES $ 304,242 $ 30,424 $ 273, AT-RISK $ 883,274 $ 88,327 $ 794,947 TEXTBOOKS $ 300,000 $ 30,000 $ 270,000 TOTAL $ 10,530,492 $ 2,541,430

How MIGHT state cuts affect KCS? 10% cut: 10% Reduction Estimated Allotments Reduction+/- 001 TEACHERS250 positions19 positions CENTRAL OFFICE $ 574,056 $ 45,924 $ 528, NON-INSTRUCTIONAL SUPPORT $ 1,417,211 $ 141,721 $ 1,275, SCHOOL BUILDING ADMIN162 months14 months $ INSTRUCTIONAL SUPPORT27 positions3 positions $ DRIVER TRAINING $ 96,522 $ - $ 96, VOC-MONTHS OF EMPLOYMENT245 months16 months $ VOC-SUPPORT $ 67,481 $ 3,374 $ 64, SCHOOL TECHNOLOGY $ 34,783 $ MENTORS $ 53,233 $ DSSF $ 284,598 $ - $ 284, TEACHER ASSISTANTS $ 2,069,125 $ 1,488,774 $ 580, STAFF DEVELOPMENT $ 52,594 $ LOW WEALTH $ 249,814 $ - $ 249, EXCEPTIONAL CHILDREN $ 2,635,660 $ 89,612 $ 2,546, AIG $ 250,518 $ 25,052 $ 225, ESL $ 599,463 $ 59,946 $ 539, TRANSPORTATION $ 657,234 $ 52,579 $ 604, INSTRUCTIONAL SUPPLIES $ 304,242 $ 30,424 $ 273, AT-RISK $ 883,274 $ 88,327 $ 794,947 TEXTBOOKS $ 300,000 $ 75,000 $ 225,000 TOTAL $ 10,530,492 $ 3,654,595

IMPORTANT INFORMATION Legislative session is just beginning & budget outlook could change many times. Possibilities being considered: –No new taxes, and sunsetting taxes allowed to expire –Across the board pay cuts for state employees –Removing the 12% bonus for NBPTS teachers –Removing the 10% bonus for master’s degrees –Requiring state employees to pay part of their health insurance premiums

Other important Info We have met personally with our Cabarrus/Rowan legislative delegation. –They expect the legislature to provide maximum flexibility so school districts can maximize their limited funds. Cabarrus County has indicated we will receive at least the same funding as this year—NO cuts. That’s excellent news. State tax collections are meeting targets so far, and December sales revenues were strong—more good news.

Other important Info The Governor is scheduled to give her budget to the Legislature in mid-February. We also expect planning allotments from DPI in mid-February. These will provide our first clues as to next year’s budget picture. We have a Budget Task Force made up of representatives from all stakeholder groups. They are helping to inform our budget decisions.

Our Promises: We will do everything we can to influence legislators to FUND SCHOOLS FIRST. We will do all we can to protect jobs and the education of our children. We will be honest with you and keep you informed every step of the way. We will give you as many resources as possible to communicate effectively with legislators.

Next Steps Determine how state and local reductions will affect your schools. Communicate the impact. Stay informed through KCS, the news media, DPI, and your associations. Reach out to legislators and key stakeholders.

Next Steps Become familiar with state-level strategic cut options that have been identified to limit classroom impact, and maintain necessary infrastructure.

Questions If we cut personnel, who will make that decision and how will they decide? When will we know something about our jobs? (Timeline) Will my pay be cut? Will my hours be reduced? Where are we looking to make cuts besides personnel?

Questions If our budget is so bad, how can we afford the “extras” that we’ve been doing: Biotech Academy, 411Fit, etc.? Will class sizes increase? Will we change the structure of how teacher assistants are paid?