About 90 citizens turned out to the Board of County Commissioners chambers on Main St. tonight -- a remarkably large turnout, and one that was due to the proposed budget cuts to schools, non-profits and other programs.
And while half of the attendees left after the school funding matter was completed, they didn't leave with a final answer at hand. The BOCC deferred any decision on school funding, asking Durham Public Schools superintendent Carl Harris and County Manager Mike Ruffin to sit down for further negotiations to ease the effect of budget cuts.
Ruffin continued his call for a $3.1 million mid-year decrease in funding for DPS in light of the county's bleaker-than-expected budget situation, focusing much of his argument on the fact that actual enrollment had lagged projections, contributing to what Ruffin framed as a $1.45 million "overpayment" to the schools.
Harris, on the other hand, asked the County to make no cuts, or no more than $1 million if cuts were needed; he noted a $1.3 million giveback that DPS had already made to the state, and another $1 million giveback expected to occur next month.
After more than an hour of generally polite, if occasionally contentious discussion on the part of the parties and especially the public, the BOCC directed the matter back for more staff negotiation.
It was a night of full turnout for DPS stakeholders; schools superintendent Carl Harris and DPS PR chief Kay Williams were visible at the rear of the hall -- along with a panoply of DPS staff, at least one of whom appeared to themself be carrying one of the blue pro-school "Put Our Children First" signs visible in the hands of many attendees. The entire school board was also in attendance.
The County's View: The discussion began with a presentation by Ruffin, who recalled his three days in municipal management by noting "there've been a lot of high points over those 31 years... I can't think of a lower point than having to come forth with a recommendation like this."
The biggest risk raised by Ruffin related to property tax collections; these could range anywhere from $1m to $9m below normal, a wide range he noted related to the fact that late taxes (those incurred in 2008 and only now being collected) were always the toughest to capture, and that they wouldn't know yet how much would or wouldn't be captured.
Also ominous: sales tax collections for October are 10% below October 2007, Ruffin noted, while the numbers from the all-important December holiday shopping month wouldn't be known until mid-March. Other revenues like Register of Deeds collections and investment earnings were also trending low. All told, the county faces a projected deficit of as much as $14.24 million.
Anticipating correctly later comments as to whether the county could use its fund balance to make up the deficit, Ruffin warned about the need to maintain a 15% fund balance to maintain the county's important AAA rating, requiring fund balance savings well above the 8% minimum required by the state. Ruffin also noted that reducing the fund balance now could create problems in next year's budget, particularly since the impact of state funding holdbacks on counties was not yet known.
"Most of us at home when we have a drop in income, what do we do? We drop our expenses down. Same principal applies here," Ruffin said. "I suspect next fiscal year is going to be worse than this one in terms of revenue forecast."
Ruffin noted that county departments were asked to take reductions of 6% or more, compared to 3% reductions in non-profit and school budgets.
Key to Ruffin's argument: Durham Public School's projected enrollment of 32,925, which overestimated by almost 500 students the actual attendance. Given that the school system's local funding is calculated on a per-student basis, Ruffin noted that the DPS should have received almost $1.45 million less in funding for this year.
The manager noted what he claimed was a long-standing agreement with DPS to adjust budgets based on the presence of "tremendously more students than projected at budget time" several years ago. "[The Dept. of Public Instruction] takes their money back when they overfund. We don't."
Discounting bond indebtedness, Ruffin noted that Durham provides the highest local per-pupil funding of the ten largest districts in North Carolina, and ranks fourth out of all students in the state.
DPS' Response: Ruffin's arguments were rebutted by Carl Harris, joined by administrative staff and community supporters to argue against the cuts. The superintendent noted that while he was not prepared "to say specifically" where $3m would be cut, he singled out technology, capital projects, and vacant positions. Non-teaching positions would be converted to teaching positions, with cuts to jobs overall possible if needed.
"There are many who believe that any support beyond the classroom is not as critical and therefore much easier to eliminate," Harris said. "I ask each of you to think about the support that students get, and it's because of that support they are provided by non-teaching staff that support them being successful inside the classroom."
Superintendent Harris notes his concern about making cuts with only five months left in the school year, particularly after investing in programs like small high school programs at Southern and Hillside and the forthcoming Montessori middle school planned at the Lakewood YMCA.
"Because of our collective effort, more of our students are continuing in school rather than dropping out," Harris said.
"During the time that I have served as superintendent of Durham Public Schools, fiscal accountability has a been a priority for me," Harris said. "I believe you realize how serious we are about the work that we do, and how much we realize resources are essential" to our success.
Noting the $1.3m cut already taken and a $1m cut still to come, Harris urged the BOCC to consider a 1% reduction instead of a 3% cut in the local funding.
School board chair Minnie Forte-Brown spoke next, noting that Durham leaders had just traveled to Portland, Oregon to see how disconnected youth are being supported in that community. "It is a fact that a culture is judged by the way they treat their children and the elderly. Strong communities support strong schools. Durham is a strong community," Forte-Brown said.
"Now is not the time to cut public school funding unless every other resource has been exhausted," a passionate Forte-Brown said.
Local businessman and DPS administrative services committee chair Steve Martin compared the situation to his own experience working in the auto industry, noting that in his position, his business can cut staff or people can choose not to buy cars. "Not so with teaching our children," Martin said.
Martin concurred that on the face of it, out of a $369m budget, a $3 million cut doesn't sound like much. But says cuts midyear can't be made "without affecting our core business," Martin said.
Martin also noted that only $3m exists in the fund balance for DPS, below the $16-18m recommended by DPS' auditors -- a reference directly back to comments made by Ruffin and quoted in press reports about the flexibility the county manager had attributed to DPS' flexibility in using its fund balance.
Martin also noted that 31 positions had been cut within the Fuller Building downtown central services building in recent years, with positions moved to educational work instead
"As we've looked very carefully over our budget, I'd be remiss if I didn't ask" if some of the $31 million County fund balance could be used for "the rainy day" currently being seen.
DPS chief operating officer Hank Hurd noted that half of all local funds goes to salaries and supplies, with another 34% supporting operational costs.
Hurd complained that the amount DPS had to pass along to charter schools had risen as well, from $7.4m to $8m this year thanks to an increase in enrollment at these institutions.
"And again, not to be redundant, we have received cuts from the state. They took back funds for growth. The hard part about growth is, we've already hired the teachers, the principals" for the increase, Hurd said.
Hurd added that the local school system has had to absorb costs for everything from gaps in funding bus fuel, to floating payroll expenses, to unfunded state mandates like the troubled NCWISE information system and teacher raises pushed through by Gov. Easley. Additionally, Hurd noted, DPS' allocation of students in both special needs and gifted categories exceeded the state gaps, requiring additional local funding.
Citizen Comments: During the citizen comments, residents stood largely -- but not universally -- opposed to the cuts.
Wisdom Pharaoh from Durham CAN and the McDougald Terrace resident council expressed "deep concern" over the proposed cuts. "We think that cutting resources for children should be the last strategy to be considered," Pharaoah said, adding that "we think those services provided by the downtown central services staff are critical to the success" of the public schools.
Victoria Peterson praised Harris' work, and noting that notwithstanding his work and that of the school board, which she also praised, "This community has been in trouble for a long time with its youth."
"Mr. Ruffin, I would like you to share this with the public... I thought I heard this county talk about extending, adding on to the Durham County Jail. $68m, am I correct?" Peterson said, asking the BOCC to give the school system what they need.
"If we can find $68m to add and to expand the county jail, man, we should be able to find $3m to empower our young children in this community."
Others, though, walked away unconvinced by the schools' arguments. Lois Murphy noted that while she had originally come "to speak in opposition to any reduction" in the school budget, her opinion had changed from the data presented. "It sounds like there is some room" for reductions, Murphy said.
Lavonia Allison from the Durham Committee on the Affairs of Black People also seemed to express some concerns over the data presented, while alluding to the late evening presentation of so much data. "I looked at this info that I just got tonight, and I would have been very pleased tp stand here tonight and to say we need every dime to educate all the childen," Allison said, but noted that in her view, the system was not in fact educating all the youth.
The BOCC Deliberates: At the end of the comments from both sides, commissioners pressed both school and County staff on whether further compromise was possible.
Commissioner Joe Bowser pressed Hurd on fuel costs, asking why DPS hasn't incurred savings from lower-than-expected diesel fuel costs. Hurd noted that while this had been a "bright spot" for the budget, the state -- which funded much of the fuel expense -- had started recapturing funds in excess of actual costs, reducing any savings there.
Commissioner Becky Heron asked what DPS had done on more optional items such as curtailing travel by staff. "I think the school system should do the same thing [as the county.]"
BOCC chair Page echoed Heron's question, asking about whether staff development had been considered -- a $3.5 million line item in the DPS budget. "We have asked our own departments to be mindful of this. Is there a way you can address this as part of this?"
Harris replied that DPS had taken the "same basic steps" that most organizations were taking; Harris claimed that the system was only permitting "absolutely necessary" travel for the district, while choosing not to fill positions "that we believe we could not fill."
"Remember, this is not a new approach to reducing the budget," Harris said, noting the recently-requested cuts.
"Is there some option there [with taxes] that could help us with regard to saying that if we don't really experience this deficit, this shortfall, we could make this up?" to the schools, Page asked, to which Ruffin responded in the affirmative.
Heron reminded Page that there are other non-profit organizations taking a big hit. "If there's any excess money, which it's a miracle if it is, we're going to have to dole it out."
"I worry that it's going to be worse and not better, but I appreciate your optimism," Ruffin replied.
Commissioner Brenda Howerton asked what the impact on the county budget would be if we honored Harris' 1% cut request.
"I don't think you're going to find $2m more out of the county budget at this time," Ruffin said, noting that the cuts would come deeply out of the county budget.
(From the back row, a bemused Steve Martin from DPS' administrative committee said quietly, "So moved.")
BOCC member Ellen Reckhow posited the benefits of the school system and county government coming together to review the need for cuts. "Over the last several years, this board and this manager have worked very constructively with the superintendent and the school board, and budget times have been good times, they haven't been contentious, and we have worked together for the best outcome for the community."
Reckhow suggested deferring any action tonight to allow Ruffin and Harris to come up with "a meeting of the minds" they can bring back to the board. "I would suggest that there's some middle ground between those two numbers," Reckhow said. "I think a good starting point is the $1.45m overage on the enrollment, and I think we should ask them to work from that number and look at anything else."
Page agreed with Reckhow's comments and a call for more negotiation, and noted that based on his experience as a former school board member, there were clearly other items that could be reduced.
"Our county departments have taken this hit," Page said. "In fact, some of them have taken 6%. It's so hard for us to ask them to take this hit and not ask others in the community to take the same thing."
Bowser agreed, having earlier in the meeting pressed staff on the amount of bond indebtedness, and emphasized the importance of maintaining the county's AAA fund balance in order to be able to continue borrowing for school construction -- a point Ruffin underscored in noting that out of $40 million in bond interest spending this year, over half was for school projects.
The BOCC moved forward with a postponement of a final decision, with the details left to a discussion between county staff and the school system in advance of more negotiation between the organizations.
Kevin, excellent coverage and details. Thanks for the thorough job!
IMO, by cutting non-profits like the Life and Science Musuem and Animal Protection Society then same percentage as schools, the County is saying Dogs and Butterfly exhibits are equally as important as the education of our children. I've lived in a school district that has to get incredibly creative to fund schools and programs, so I know my children will be ok, because as a family we have resources.
BUT there are A LOT of kids in these schools that don't have this advantage. If County cuts 3% on top of everything else the district has lost then it's going to be the kids at the bottom who suffer the most. These kids need those extra services, after school tutoring, in school services. If they don't get them, then we may as well increase the new jail budget from 68 M to 136M. Quality education keeps people out of jails and keeps them from need services by Urban Ministries. We either pay for it now or we pay for it later.... and we possibly pay for it personally by increased crime.
The programs for kids at the top, such as AIG, are also at risk. While these kids will not suffer as much personally, it's probably that if their parents can get them the quality education they deserve elsewhere, then these families will leave DPS. DPS needs these kids and these committed families too. The county needs these families too.
I just don't see how cutting schools 3% will help any of these students or Durham as a whole. For Durham to be a strong, vibrant city that can compete with our neighboring towns, we MUST have strong public schools. Here in Durham we have a few more challenges than other cities, so our schools are going to cost more in the short run. If don't grow our schools our downtown will never grow into a real urban center. Durham needs strong schools and Durham Schools need money. It's a simple fact.
Posted by: Tina | January 13, 2009 at 10:35 AM
@Tina: You bet. Personally, I'm a big proponent of public schools. That said, I do think that it is important to take a deeper look at the issues at play here.
One note of some relevance: the total DPS budget is around $470 million. The local contribution this year is about $110 million. The 3% applies to the local and not total funding. So we're talking here about $3.1 million from the County and $2.3m from the state through Feb. 2009, or about 1.2% of DPS' budget. At the lower county reduction requested, we're talking about a 0.7% reduction.
A question we'll be researching here at BCR this week: what does Durham spend today on schools, and for what, and how does that compare to its peers in the state? We'll be diving through the N.C. DPI reports later this week.
Also, we're working to get school board chair Minnie Forte-Brown on "Shooting the Bull" this week.
Posted by: Bull City Rising | January 13, 2009 at 10:54 AM
@Tina - You make a lot of great points. It costs a lot more to keep someone in jail than to keep them in school.
In addition to operating funds, the schools are also suffering from a lack of capital funding. The County is planning to spend over $200 million on the new courthouse/Sheraton and new human services buildings.
Meamwhile, my daughter is spending a third consecutive year attending elementary school in a trailer. A very old trailer - one of four at her school, and one of 130 or so across the county.
The trailers have poor, expensive to operate HVAC systems. They sit on the playground and right beside the parking lot, allowing easy access for anyone without going through the office first. They are not safe in storms.
On top of all that, I got a notice last week advising that the trailers have asbestos floor tiles that DPS monitors regularly to ensure safety. Is this the best we can do for our children? It is no wonder that those who can afford it flee DPS for private schools.
Posted by: Todd | January 13, 2009 at 11:24 AM
Seems like charter schools, who manage their budgets very carefully to stay in business, are the only bright spot in this report. Funny that.
Posted by: KeepDurhamDifferent! | January 13, 2009 at 12:51 PM
@ KeepDurhamDifferent, the kids who are most at risk in DPS are the least likily to utilize Charter Schools. I think Charters are a good option for some. But keep in mind that Charters have to offer the same amount of schooling as a public school with less funding. That usually means something is cut at a charter school. There might not be a counselor or sports and clubs for high schools. Charters are not the only answer... they are a small part of the equation. And over the years Durham has seen some Charters fail pretty miserably while others suceeded. Some might be a bright spot and others are not. Just like public schools.
@Kevin, thanks for the continued research. I look forward to your Shooting the Bull. I did realize that the 3% was actually less than 3% of the whole school budget. However, I did not know it was only .7%. And for clarity my comments were more toward the County Commmis... not you. I know you are on the side of public schools. :)
I really hope that .7% isn't going to affect programs for at risk students!!
Posted by: Tina | January 13, 2009 at 02:09 PM
Correction: the DPS budget is $369m, not $469m. This has been corrected in the story on 1/25/09.
Posted by: Bull City Rising | January 25, 2009 at 11:18 AM