Nixed taxes, state cuts put area districts in tight spot

By Carol McGraw and Kristina Iodice
The Gazette

Schools have cut budgets for several years, and the choices of what goes next are running out.

The classroom might be the target.

"To some extent, you get what you pay for, said Glenn Gustafson, Colorado Springs School District 11 finance director. "If we want to have the lowest-funded education system in the United States, then be prepared for the consequences of that."

Officials want to keep looming cuts out of the classrooms, but can they?

While administrators and board members from many districts in the region shied from giving specifics, the reality is that cuts are getting harder. Hushed talk of teacher layoffs is widespread and in smaller districts there's talk of combining grades.

"There's just nothing left," Gustafson said. "People won't be happy when we have to close schools and lay off teachers, but that's what's going to start happening."

The state has slashed education funding for three consecutive years, and a fourth cut is set for the 2012-2013 budget year. The governor is proposing another $89 million in K-12 education cuts. At the same time, schools face rising costs, including higher energy costs.

The Colorado Department of Education estimates inflation will cost districts about $261.4 million statewide next year.

Educators also predict the proposed $89 million might be a low estimate, and worry that legislators could increase the cut. State Proposition 103, which supporters said would have stopped school budget bleeding, was overwhelmingly voted down Nov. 1.

"We've gotten so frugal, it's fiscally irresponsible," said Lisa Weil, policy and communications director of Great Education Colorado.

People connected to schools, such as teachers and parents, understand the financial struggles, she said. The challenge is convincing others that schools are worth more money.

"Do we want kids paying the price for the economy?" Weil said, adding that a fourth year of cuts will be devastating.

In recent years, cuts at area districts have included administrators and support staff, free transportation and special programs. Teacher pay has been frozen, and families have paid more for student activities.

Gustafson said D-11 has cut the easiest stuff – travel, conferences, overtime pay, food and capital purchases.

"Eighty-five percent of our budget is personnel," he said. "We will have no choice but to look at cutting positions or reducing the amount that people make."

Jan Tanner, D-11 school board vice president, said if positions are cut it will be handled through attrition.

"When a teacher leaves, they won't be replaced," she said, adding that is how past staffing cuts have worked.

The board will have to work with whatever is given to it, Tanner said.

"It's going to be brutal," she said. "We're kind of down to the bone, but if we have to cut, we're going to do it."

Harrison School District 2 has made more than $13.5 million in cuts the past three years and the general fund revenue for 2011-2012 is around $70 million. In a strategic move, the district, cut 60 positions three years ago, most handled by retirements and staff leaving.

Last year, the district took a $3 million hit, eased by closing a school with low enrollment, ending several programs, including an adult education and English language learning center, and increasing class sizes.

It is now looking at about $1.8 million in cuts, estimated Assistant Superintendent Kevin Smelker.

"It will be a tough year. We always try to keep it away from the classroom, but when things are this severe it could impact the classroom."

Possibly the hardest hit will be the small rural districts east and south of Colorado Springs.

"There isn't any fluff left. We haven't had any fluff for years," said Paul McCarty, superintendent of Hanover School District 28.

The district expects to cut up to $250,000 from the $3 million budget, including an estimate for declining enrollment.

"Everything is going to have to be on the table," McCarty said. "We are going to have to be creative. We will even consider combining grades to survive."

The district does however, draw a line. It won't charge for bus transportation given that more than 60 percent of the students are on free or reduced-price lunch.

These recent years of financial challenges are not new, said Weil of Great Education Colorado, a nonpartisan group that was a major proponent of Prop. 103.

"Districts and schools have been doing more with less for 30 years," she said.

Even if budgets stabilize, schools will be underfunded and that isn't fair to kids.

"Nobody wants cuts to education," Weil said. "People really do care about schools."

But they also care about their own pocketbooks, as indicated by the failure of tax measures in three of five local district in the Nov. 1 election. Even the lure of matching state money did not entice voters in many districts statewide, including Peyton School District 23 JT.

If approved, the measures would have funded such things as construction to ease crowded schools, safety improvements, replacement of crumbling buildings and computer technology as well as backfilling state cuts.

"We will work to handle our challenges in the best ways possible, but this will have impacts on our schools and our students," said Chief Education Officer Becky Carter of Falcon School District 49, where two tax measures were defeated. Administrators and the board have tried to minimize cuts to the classroom, but based on anticipated 2012 cuts, everything will be impacted, she said.

About $11 million was cut from the current school year's budget, which included slashing the number of people in central administration and charging fees for transportation.

School board member Andy Holloman, defeated in the recent election, said the new board probably won't have to deal with such drastic cuts, but it won't be easy.

"There are very few places for them to go outside the classroom," he said.

One district where the ax isn't poised to fall is Cheyenne Mountain School District 12, where voters appoved a mill levy override that will provide an extra $1.7 million yearly to help backfill state cuts. The district, which is among the highest performing in the state, cut more than $4 million the past three years, which resulted in staff reductions and a school closure.

"We are in a good place. I don't think there will have to be cuts," said Superintendent Walt Cooper.

But essentially, the infusion of money preserves what it has and doesn't allow for expansion of programs.

He said the $89 million figure cited by the governor is just the starting point.

"I'm not focusing on that number because so much politics will take place in the legislature between now and when the bottom line is reached next March."

He is not optimistic about the state of education finance: "Districts everywhere will keep suffering until there is a bigger fix and no one seems to know what that fix will be."

The fix doesn't seem to be coming anytime soon.

"We are the only state in the nation that has to have voter approval for tax increases," noted Rich Jones, director of policy and research for The Bell Policy Center in Denver.

Colorado spends $2,408 less per pupil on K-12 than the national average of $10,586, and is almost at the bottom in higher education funding.

Between the Gallagher Amendment of 1982 and TABOR in 1992, schools have been squeezed because of the downward push on property assessment rates that helps pay for schools.

Jones noted that in 1989, 57 percent of K-12 money came from the local level, and 43 percent from the state. But in 2011, 63 percent came from the state.

Another contributor: In the past 20 years there has not been a general purpose tax increase statewide.

At this rate, in the next 15 years, the state will have only enough money to pay for K-12 education, health care and corrections, Jones said, citing a University of Denver study.

"My guess is that going forward K-12 and higher education will continue to get hit."

The DU argument is there's a structural problem, he said. The costs are increasing faster than revenues come in, and even when the recession ends, the state won't keep pace.

The choice ahead? Bring more money in, or continue to cut.

Gazette Reporter John Schroyer contributed to this story.