GRAVES: School budgets best viewed with low expectations

• Joe Graves

Joe Graves

Talk about it

As an avid consumer and reader of self- and business-improvement books, I have to admit that I am increasingly cynical about this genre. Wheat among the chaff can definitely be found, but sorting through that chaff is becoming increasingly a job best suited for earth-moving equipment. Which is why I am more and more appreciative of those who can share their secrets of success in the pithy statement rather than the ponderous volume. (And, no, the irony is not lost on me that I am criticizing long-winded writers.)

One such adage, supported in fact by psychological studies, is particularly cynical but still telling: “The secret to success is low expectations.” I am tempted at this point to tell the story of my freshman college roommate who never attended a single biology lecture class and who, upon receiving a B on his report card, let loose with a string of mild curses. I asked him how he could possibly be upset with a B when he never attended class, to which he responded, “I’m mad because I must have worked too hard. All I needed was a C.” But I would never tell that story for fear of embarrassing him.

Regardless, the story is on point. By setting the level of success at a C, my roommate experienced terrific success.

It was through such a lens that I viewed the announcement on Dec. 6 of the governor’s proposals for education funding for 2012-13. Essentially, he recommended the statutory 2.3 percent and added 0.7 percent to the finance formula in an attempt to begin catching up. He also included $8.4 million in funding to assist schools with the new common core standards, STEM education, and teaching evaluation requirements, which will definitely be helpful but won’t add to the school districts’ bottom line. Media reaction to this was markedly positive and, in fact, suggested that schools were receiving something of a windfall.

Now before you jump to the conclusion that I think the governor’s funding recommendations this year were Scroogian, this is not my view at all. In fact, I think the governor worked very hard to figure out a way to increase school funding this year when it must have been very tempting to hold tight to the budgetary reins in the midst of a precarious and lethargic economic recovery. Given his conservative and, in my view at least, sound approach to state fiscal policy, he clearly stretched to make sure he could do well by education and the children of South Dakota.

The issue was not with the proposed allocation, but rather with the reception it received among some media outlets who seemed to believe that the extra 0.7 percent would instantly solve all school budget problems and bring about a new era of Edenic bliss. It won’t and it can’t.

Last year, schools took a 6.6 percent cut and most of the schools, based upon survey data provided by ASBSD, used one-time measures to fill the operating deficits this year, in hopes of preventing cuts through better times in 2012-13. But arriving at that 6.6 percent meant removing about 2.2 percent of the cut (originally 8.8 percent) which was made up for through one-time dollars. When the governor this year put in 2.3 percent, he essentially replaced that one-time money from last year, yielding almost no actual new dollars for schools. The 0.7 percent increase was new money but, at less than 1 percent, it’s hardly a jubilee year.

For Mitchell, assuming constant enrollment next year, it means about $90,000 in new dollars. This is real money, but it isn’t enough to meet typical raises for our employees, to say nothing of the normal inflationary increases in transportation, utilities and supplies or a necessary increase in staffing next year due to enrollment increases from this year. It means, in fact, a new budgetary hole which we will have to figure out and the necessity of pleas that perhaps the Legislature will do a bit better than the governor’s recommended budget for education.

The scarier part is that Mitchell is in relatively good shape for South Dakota schools. We have decent reserves and an opt-out that sits at half of its maximum level. And we kicked no deficit cans down the road. Other schools aren’t so lucky. Their reserves have been tapped to the point at which they cannot be reduced since a certain liquidity is necessary in order to cover payroll. They have no opt-out. Worse, in many cases, they made cuts last year that can’t be sustained because they came from private funding sources, i.e. gifts, to sustain the school’s program for just that one year. They have, in other words, large unfilled holes in their budgets against which 0.7 percent will do little.

Thus, come March and April, you may see a surprising disconnect. People who heard in December that schools received more money will now hear that their schools are in dire fiscal straits and making Draconian cuts to their programming. I suspect that is, in fact, where we are heading right now. So take the next few months to lower your expectations. It may be the only way to achieve school budgetary success.

Tags: joe graves, opinion, columns, education