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Shortfall – Enrollment drop forces Mt. Angel to face large budget issues

By Stephen Floyd

The Mt. Angel School District (MASD) is considering deep cuts to programs and staff to cover a large budget deficit as enrollment continues to decline.

Based on current estimates, the shortfall could be around $783,000 if there are no significant differences in enrollment between the current school year and the next. However, projections range between $682,000 and $965,000 based on how many – or how few – students will return.

The board is considering a range of options including layoffs, furlough days, and cuts to academics and athletic programs, as well as utilizing emergency funds received to offset revenue losses from the COVID-19 pandemic.

Officials are expected to decide on cost-saving measures in April as the budget process begins for the upcoming school year, though cuts may take effect during the current school year.

Pandemic enrollment hit

MASD was among 82 percent of Oregon districts that reported drops in enrollment during the COVID-19 pandemic, totaling roughly 30,000 students. Between significant shifts and the jobs and housing markets, and polarizing attitudes toward public education, many families moved or chose to not re-enroll students.

Average daily enrollment at MASD, as calculated for the distribution of state tax revenue, has fallen 15.6 percent since the 2018-2019 school year, and came in 6.8 percent lower than projected for the current school year. 

Business Manager Kristi Brackinreed said she believes enrollment is likely to stabilize, but even an increase in students for the 2022-2023 school year will not fully address the need for budget reductions.

Brackinreed reported the budget situation to the board during its March 14 meeting. She said they have multiple strategies at their disposal, but all cost reductions come with a downside and the community will likely feel the pinch.

Sports aren’t off the table

The biggest opportunity for cost reductions was in athletics, which could eliminate up to $280,000 from the budget as the district would not need to pay for coaching, transportation, equipment, uniforms and other costs related to student sports. But because of the significant role high school and middle school sports play in the lives of students and the community, Brackinreed said cutting athletics does not seem like a practical option.

“There really isn’t a pro at all,” she said. “You’re going to have an upset community, you’re going to have upset students, we’re going to end up losing students to other districts, and it’s going to impact their mental health.”

However, Board Chair Shari Riedman said it is too early to take athletics off the cost-cutting table. Though losing some or all sports would be a blow to morale, Riedman said the district’s primary goal is education rather than extracurriculars.

“I’m not proposing we cut sports, just to be clear,” she said. “It needs to be part of the conversation. All of these options need to be part of the conversation.”

Riedman asked Brackinreed to provide an analysis at the board’s next meeting of costs per sports program and costs per individual athlete to help members make an informed decision.

Cuts to staff, teaching materials

Brackinreed also said the district could lay off staff, noting the cost of employing administrators and supervisors averages $147,000 per person, certified staff such as teachers averages $108,000 per person, and classified staff such as maintenance workers averages $66,000 per person. She noted eliminating positions will create more work and pressure for the employees who remain, and would also present a challenge if funding is higher than projected next school year and the district lays off employees they are not able to rehire.

“We could lose a potential good teacher who knows us and knows [our students],” she said.

Rather than eliminating specific positions, Brackinreed said another option would be furlough days, which would cut school days from the existing academic calendar. This would save the district around $35,000 per day, and distribute cost reductions among all employees, who would lose an average of $80 to $300 per day in income depending on their pay scale.

But the number of furlough days needed to make up the deficit could amount to multiple weeks out of the school year, even when combined with other options, which board members said would be a significant drawback. Brackinreed noted one benefit of furlough days is they could be implemented during the current school year to increase revenue carryover. If funding was better than projected for the next school year furlough days could be adjusted to cover the smaller gap.

“We have some flexibility with that, which is nice,” Brackinreed said.

The lowest-impact cost-saving measure would be eliminating $120,000 budgeted for an update to the language arts curriculum, which would include new books and materials for all grades. Brackinreed said the update is needed to replace a curriculum that is several years old, but could be postponed.

$600K in COVID relief

Aside from cost reductions, the district has the option to use up to $600,000 in federal COVID-19 relief funds expected to carry over at the end of this year. The funds were made available to cover losses in revenue experienced during the pandemic, and the district has broad discretion for how they are used.

But the funds are limited and won’t be replaced, so Brackinreed said the district should be cautious about how they are spent. For example, if the funds are used to support staffing this year and are no longer available next year, and if revenue does not improve, the district has simply delayed the need for layoffs or other cost reductions rather than solved the deficit.

“At some point there’s going to be a cliff and that funding’s gone,” she said.

Brackinreed said she would feel comfortable using $300,000 of the pandemic relief funds to support next year’s budget, combined with other deficit reductions. That way staff and programs take less of a hit, and relief funds remain in case revenue does not improve as the pandemic subsides.

Multiple options, no decisions yet

As an example of options available to the board, Brackinreed said if enrollment is stable they could apply $300,000 in relief funds, postpone the $120,000 curriculum upgrade and schedule 12 to 14 furlough days, which would make up the $783,000 projected deficit. However, multiple combinations of options remain and the ultimate change in enrollment will not be known until next school year.

By the end of the meeting, board members had not indicated a preference for one strategy over another. Brackinreed said they don’t have to decide on cost-saving measures until April. At that point they must provide direction to the budget committee which begins meeting in May to compose the budget for the 2022-2023 school year.

Brackinreed also said the district should have final income projections for the remainder of the current school year by then, allowing the board to make more precise decisions about the deficit.

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