Opinion: Budget cuts back for another visit

When Simon and Garfunkel sang the beginning words to “The Sounds of Silence,” “Hello darkness my old friend,” they tapped into something quite deep in the human psyche. Though I’m typically not a fan of any music written since the 1940s, I have to admit that song always gives me pause. In fact, when the final school budget cut numbers came down recently from the state, those same words occurred to me. Then, in a mental spoof, they ran back through my head as “Hello budget cuts my old friend.”

Truth be told, budget cuts are no longer a terror in the night or the fiscal equivalent of the Grim Reaper whose visits are mercifully infrequent. For the last 11 years in Mitchell, the need to make budget cuts has been a reality every year but two or three. They have become like the return of robins as an infallible harbinger of spring.

The only advantage in all this is that with repetition comes a certain skill. What you must do often, you typically become more adept at. I’m sorry to say, my budget cutting scythe has been honed to a fine edge by these annual visits to the whetstone. To some degree, this has also left me somewhat calloused, a trade-off to being able to move quickly to the nub of an issue. But my familiarity doesn’t translate into everyone else being able to as quickly see why I will be making certain recommendations for dealing with the latest, largest revenue cuts.

Allow me to take this opportunity to address, then, just a few items.

The Priorities: When facing a cut, the first thing is to keep the first thing the first thing. In a school, the first thing is the students. And as far as the students are concerned, the first thing is the academic program. Thus, when making cuts, we work hard to ensure that cuts stay as far as possible away from the core instruction that we provide for Mitchell’s students. This would be an easier priority to adhere to if the cuts hadn’t been so consistent over the last decade and so large this particular year. Nevertheless, it remains our first, primary goal when figuring out where to cut.

Other considerations: The priority really is the most important factor but it’s not the only one. A number of other considerations also weigh in, including:

1. This year’s cut was a true 10 percent at the state level. The impact of this was lessened by help from the gubernatorial and legislative level which froze school property tax levels across the state. The school general fund levies tend to drop each year as assessment rises. By holding them up, the state allowed us to take less than a 10 percent cut, actually a 6.6 percent cut. This saved the Mitchell schools $408,000 as the full 10 percent would have been $1.2 million and the actual, final cut proved to be $792,000.

While the cut is still a stunner, it could have been worse. The fact that it is not worse is due to the fact that all taxpayers are seeing a higher levy this year than they would have seen had the freeze not occurred. In other words, the property tax owners, both in the state and locally, have taken on an extra burden this year. One could argue the burden was $408,000, though in a normal year, the budget cuts would not have occurred and so the new burden would be much less than this.

Regardless, the property tax owners have, in fact, come to the schools’ rescue on this and spared us about one-third of the cut that would have otherwise happened. Why do I bring this up? I raise the issue because since the property taxpayers have already removed some of the burden, it is probably not entirely fair to balance all of the rest of the cuts on them through the optout. Will I probably recommend that the opt-out be raised from its current $200,000? Yes, but I won’t recommend that it simply be pushed all the way to the maximum of $700,000 as that would revisit the property taxpayers with what would then be almost the entire sacrifice.

2. There is another reason not to push the limit on the opt-out in one year. Part of the reduction in the cuts came from $14 million in one-time money from the state. The “one-time” is critical there. This means that before the Legislature can give us an increase next year, it first has to backfill that $14 million, meaning the possibility of cuts again next year and the virtual certainty of very low or no increases. We may, in other words, need to look to the optout again next year and once an opt-out is maxed out, it is useless as a tool to deal with future shortfalls.

3. Cash Reserves: It is true that the Mitchell School District has some cash reserves. These are there because our highly skilled business manager and fiscally responsible board have carefully managed our funds. They are also there because schools must have reserves in order to meet payroll twice a month, given the bimodal distribution (fall and spring) of property taxes each year. Yes, some limited reserves can be used to meet this crisis, but any such use will make potential future problems even more difficult.

4. Finally, some continue to argue that this fiscal crisis is a temporary issue that we will all quickly recover from in the near future. These are the same people who said Gov. Rounds’ initial 5 percent cut was unrealistically high and that Gov. Daugaard’s 10 percent proposal would never fly.

The governor has said repeatedly now that this year’s budget is like hitting the reset button and that he won’t use budget tricks or large infusions of one-time money to balance the budget. He won’t, in his words, keep kicking that can down the road. I may not like it and my peers may not like it, but I also have to acknowledge by this point that it may very well be a mistake not to believe he said what he meant and he meant what said. If so, there is really no point in kicking the local can down the road, either. We’ll need to deal with the shortfalls now, not next year or the one after that.

In the next week or so, we’ll be laying out just how we plan to do that, to deal with the latest visit from our old friend, budget cuts. If we do it right, perhaps we can make his visits a little less frequent.

Tags: joe graves, opinion, updates, columns