Mitchell superintendent: 10 percent funding drop ‘worst-case’ scenario

Talk about it

In his first state budget address from Pierre on Wednesday, South Dakota Gov. Dennis Daugaard proposed $60 million in cuts for state funding to K-12 education. The chop is among $127 million in statewide cuts outlined by the governor.

The roughly 10 percent cut delivered a “worst case” budget scenario for Mitchell schools, said Superintendent Joe Graves, and will amount to roughly $1.2 million in reduced funding for the Mitchell School District. In previous comments, Graves had remained hopeful the cuts would be no more than 5 percent. “We’re going to have to make reductions,” he said Wednesday.

Daugaard’s 2012 budget proposal will reduce per-student funding by $480.46 — from the current $4,804.60 a student, to $4,324.14 a student.

The governor’s proposed cuts are just that, noted Graves.

“I’m holding out hope that the Legislature will find ways to make some changes and lessen the hit,” he said, noting that Mitchell’s K-12 general fund, or operating budget, is about $14.5 million.

If the cuts become a reality, Mitchell could lessen the impact, Graves said, by using its $700,000 opt-out, by dipping into budget reserves, and by making targeted cuts throughout the district.

The easy cuts, which Graves called the “low-hanging fruit,” have already been made, he said.

Over the past 10 years, the district has closed the Mitchell Middle School pool, sold off unused buildings and also eliminated some programs and positions.

Any future cuts to programs or staff will be more painful, he predicted.

Graves said he has already asked his staff to suggest areas where cuts can be made.

The cuts may result in larger class sizes statewide, including Mitchell, but “we’ve tried hard not to do that,” Graves said.

In 2002, Mitchell voters approved an ongoing $700,000 opt-out which the district has used sparingly in recent years. If that financial tool is more heavily used, however, it is unlikely the district will ask for the entire amount each year.

Whatever amount the district uses, only half the selected will be available for school district use in any given year, since opt-out funds are appropriated on a calendar budget year and the school district operates on June-to July fiscal year.

“Another part of the solution will be an increase in the use of our $3.7 million in reserves,” he said, “but after that, we’re going to have to make some cuts.”

Those cuts are still being considered. “We’ve got nothing on paper yet,” Graves said.

If Daugaard’s proposed school cuts are approved there could be substantial cuts to local property taxes, Graves said, but he had no estimate on how much of a reduction could be seen on tax notices.

In his budget address Daugaard proposed eliminating the state’s structural deficit in one fell swoop, rather than dragging it from year to year.

Graves said he saw some merit in Daugaard’s philosophy of facing the deficit problem and dealing with it.

“When I came on in 2000 as Mitchell’s superintendent, we faced a very difficult financial situation and we decided we were going to deal with it right now and get it behind us and start moving forward,” he said.

Graves said that approach has worked out well for his district — but he is still hoping the Legislature softens the blow.

Tags: budget address, news, local, education