2012 school finance survey presentation

7/30/2019 2012 School Finance Survey Presentation

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The survey:

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Between August 16 and September 3, 2012, the NYS Council of School

Superintendents conducted an online survey of superintendents onbudgeting concerns for their districts.

A total of 249 superintendents submitted complete responses, a responserate of 40.4%. Incomplete submissions from 47 superintendents were alsoincluded in the results.

Superintendents serving the Big 5 Cities (New York, Buffalo, Rochester,Yonkers, and Syracuse) and Boards of Cooperative Educational Serviceswere not included in the survey because their systems budgets are not

subject to voter approval and consequently do not report some of thefinancial data available for small city, rural and suburban districts.

The Council conducted a similar survey in 2011.


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4

Introduction(pages 3-6 in the report)


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Concern about the future is widespread

Why?

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1. Districts have already endured several tough budgeting cycles:

Average spending increase over the last 4 years = 1.7%. 83% of districts are receiving less state aid 4 years ago (2008-09)

2. Some hard to control costs have been surging (e.g., pensions and health insurance):

New TRS rate increase like requiring districts to absorb a cost equivalent to giving employees3.6-4.6% raises, whether or not they receive any actual raises.

Statewide cost of TRS increase likely to approach or exceed benefit of a 3-3.5% state aid increase.

3. Districts have relied on reserves to avoid more damaging program reductions or tax increases:

SED estimates unrestricted fund balances have shrunk from $2.76 billion in 2009-10, to $1.21billion this year.

Without appropriated fund balance, districts would have needed to raise taxes by 7% more thanthey did this year (9.2%, instead of 2.2%);poorest 10% of districts would have needed 21% morein local taxes.

4. Other than Tier VI, no significant mandate relief has been enacted so far. Relief through Tier VIwill happen only over the long-term. Meanwhile, new mandates have been added.

5. 92% of total school revenues (local taxes & state aid) are now subject to limits. Federal aid (mostof the remainder) is now at risk too.


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Even prior to tax cap, schools were holding down tax increases

Districts have responded to voters have been holding down spending and taxes

8.2%8.7%

7.5%

6.1%

4.3%

3.7%

2.1%

3.2% 3.4%

2.2%

4.8%

6.9%6.6% 6.3%

6.1%

5.3%

2.3%

1.4% 1.3%

1.7%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

Percentchangeo

verprioryear

% Change in proposed tax levy % Change in proposed school spending

SOURCE: Council analysis of NYSED Property Tax Report Card data ; Big 5 Cities not included

6


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Districts have been using reserves to spare students and taxpayers

from more dramatic changes but reserves run out

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SOURCE: Council analysis of NYSED Property Tax Report Card data

-31%

-23%

-9%-18%

-22%

-10%

-9%

-12%

-4%

-7%

-14%

21%

17%

11%10%

11%

8%

6%

5%

3%

3%

7%

-40% -30% -20% -10% 0% 10% 20% 30%

1 (Proorest 10%)

2

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5

6

7

8

9

10

NYS

Districts grouped by property wealth per pupil

Change in Unrestricted Fund Balance from 2011-12 to 2012-13

Additional tax increase which would be necessary without use of fund balance (i.e., Appropriated Fund

Balance as % of Tax Levy)


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8

Overall fiscal condition and outlook(pages 7-12 in the report)


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Alarm over the future:Insolvency financial & educational

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Financial9% foresee financial insolvency within 2 years41% within 4 years77% at some point

Educational19% foresee educational insolvency within 2 years51% within 4 years84% at some point

5%

5%

9%

32%

33%

12%

4%

0% 5% 10% 15% 20% 25% 30% 35%

Yes, we are currently unable

Yes, within 1 ye ar

Yes, between 1 and 2 year s

Yes, between 2 and 4 years

Yes, beyond 4 year s

No, I do not foresee that time

Unsure

Do you foresee a point at which your district would beunable to fund all the instructional and other student

service requirements established by laws or regulationsapproved by the state and federal governments?

1%

2%

6%

32%

36%

15%

9%

0% 10% 20% 30% 40%

Yes, we are currently unable

Yes, within 1 y ear

Yes, between 1 and 2 years

Yes, between 2 and 4 y ears

Yes, beyond 4 years

No, I do not foresee that time

Unsure

Do you foresee a point at which your district would beunable to ensure that some of its financial obligations will

EVER be paid?


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Insolvency by region

10

Financial Educational

19%

11%

17%

14%

22%

14%

12%

50%

8%

15%

21%

0% 10% 20% 30% 40% 50% 60%

Total

Long Island

Lower Hudson

Mid-Hudson Valley

Capital Region

Mohawk Valley

Central New York

North Country

Southern Tier

Finger Lakes

Western New York

% of districts foreseeing educational insolvency within 2 years

9%

0%

6%

0%

15%

7%

6%

25%

8%

6%

12%

0% 5% 10% 15% 20% 25% 30%

Total

Long Island

Lower Hudson Valley

Mid-Hudson Valley

Capital Region

Mohawk Valley

Central New York

North Country

Southern Tier

Finger Lakes

Western New York

% of districts foreseeing financialinsolvency within 2 years


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Reliance on reserves is a widespread concern

(83% of superintendents somewhat or very concerned)

12

49%

34%

11%

6%

0% 10% 20% 30% 40% 50% 60%

Very concerned

Somewhat concerned

Not concerned, our use of reserves islimited

Our district is not drawing upon

reserves to pay for recurring operatingexpenses

To what extent, if at all, are you concerned that your districtis drawing upon reserves to pay for recurringoperating costs?


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14

Budgeting choices and impact(pages 13-20)


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Where school spending goes

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Source: Council analysis of 2009-10 NYSED

School District Fiscal Profiles

Source: Council analysis of 2009-10 U.S.

Census Bureau data

Implication: If 3/4ths of school spending goes for instruction or personnel, then

about 3/4ths of cuts will come from those areas especially since this is the thirdyear of austerity and districts have already made easier cuts.


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Key point: Many budget actions are cumulative in impact

Example: Position reductions

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4.3%

8.0%

7.5%

3.6%

4.9%

3.6%

5.9%

5.2%

2.7%

3.9%

0% 2% 4% 6% 8% 10% 12% 14%

Teachers

Other Student Support

Administrators

Other

Total

Percent reduction in positions by category,2011-12 and 2012-13

2011-12 2012-13


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Position reductions by district type this year vs. last year

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Total positions eliminated, by category and type, 2012-13City Rural Suburb Total

Teachers 4.8% 4.2% 3.1% 3.6%

Other Student Support 7.7% 6.0% 5.4% 5.9%

Administrators 4.0% 6.1% 5.0% 5.2%

Other 3.5% 3.5% 2.1% 2.7%

Total 5.2% 4.4% 3.3% 3.9%

Total position reductions, by category and district type, 2011-12

City Rural Suburb Total

Teachers 6.1% 5.8% 3.4% 4.3%

Other Student Support 8.7% 10.8% 6.6% 8.0%

Administrators 9.3% 9.8% 6.0% 7.5%Other 4.3% 4.9% 3.0% 3.6%

Total 6.4% 6.7% 3.9% 4.9%

This year

Last year


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Actions affecting instruction

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INSTRUCTION 2012-13 2011-12 2010-11

At least

once in last

3 years

Increased class size 59% 48% 30% 67%

Reduced non-mandated art classes 16% 18% 11% 31%

Reduced non-mandated music

classes 20% 19% 9% 33%

Reduced advanced or honors classes 17% 13% 7% 24%

Reduced summer school 31% 27% 20% 44%

Reduced extra help for students

during the regular school day or year 22% 23% 14% 32%

Reduced student enrollment in careerand technical programs 18% 12% 7% 23%

Reduced/deferred purchase of

instructional technology 31% 26% 20% 42%

Reduced/deferred purchase of

textbooks 18% 13% 8% 21%

Reduced/deferred purchase of library

materials 17% 13% 9% 22%

Eliminated prekindergarten 1% 0% 1% 3%

Reduced prekindergarten 5% 2% 1% 8%

Eliminated kindergarten 0% 0% 0% 1%

Moved from full-day to half-day

kindergarten 0% 0% 0% 2%

Other reduction in kindergarten 0% 1% 0% 3%

Combined grade two levels in a single

classroom 4% 2% 1% 7%

Other reduction in instruction 34% 23% 14% 38%


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Impact of 2011-12 and 2012-13 district budgets on instruction

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0% 20% 40% 60% 80% 100%

2011 Instruction in English, mathematics, science, and soc. studies

2012 Core instruction in elementary grades

2012 Middle level instruction in English, math, science, and soc. studies

2012 High school instruction in English, math, science, and soc. studies

2011 Extra help for students who need it

2012 Extra help for students who need it

2011 Advanced or enrichment classes

2012 Advanced or enrichment classes

Severe negative impact Some negative impact No change from prior year Positive impact


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Some or severe negative impacts anticipated on specific

services by district type

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Total City Rural Suburb

Core instruction in elementary grades 41% 33% 43% 39%

Instruction in English, math, science, and social

studies in the middle level grades

33% 33% 36% 29%

Instruction in English, math, science, and social

studies in high school

37% 40% 42% 28%

Extra help for students who need it -- any level 48% 73% 52% 37%

Instruction in art -- any level 27% 23% 27% 26%

Student transportation 33% 57% 34% 27%

Advanced or enrichment classes 35% 50% 39% 28%

Special education 20% 14% 23% 15%

Athletics 44% 43% 47% 40%

Other extracurricular activities 48% 62% 53% 39%

Instruction in music -- any level 26% 23% 32% 19%

Other student services 34% 15% 39% 31%

Operations and maintenance 49% 80% 48% 46%

Administration 46% 69% 40% 49%

Other district operations and services 43% 57% 43% 43%

Percentage of superintendents anticipating some or severe negative

impact from 2012-13 budget decisions on various school operations -- by

district type:


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23

Adapting to the tax cap(pages 20-23)


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Tax Cap:Impact on spending levels & programs

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50%

47%

57%

45%

17%

13%

15%

19%

0% 20% 40% 60% 80%

Total

City

Suburb

Rural

Impact of tax cap on budgeted spending levels

Somewhat lower Significantly lower

50%

36%

49%

52%

10%

14%

6%

11%

0% 10% 20% 30% 40% 50% 60% 70%

Total

City

Suburb

Rural

Impact of tax cap on programs and services

Somewhat negative Significantly negative


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Tax Cap:

Higher need districts more cautious with tax increases

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2012-13 Tax levy decisions by SED Need/Resource Category

Need/Resource Capacity Category

Proposed

Tax Increase

Proposed TaxLevy as % of

Levy Limit

% AttemptingTax Cap

Over-Rides

High Need Small Cities and Suburbs 2.2% 99.4% 6.5%

High Need Rural 1.8% 97.9% 5.8%

Average Need 2.1% 99.4% 8.6%

Low Need 2.4% 99.7% 7.5%

TOTAL STATE 2.2% 99.4% 7.6%

SOURCE: Council analysis of NYSED Property Tax Report Card and budget vote data

1) They raise fewer dollars with same % tax increase as wealthier districts (over 20% of

districts raise less than $50,000 with a 1% tax increase).

2) Anecdotally, rural superintendents seem more likely to say residents see 2% as abenchmark to be followed.


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Tax Cap: Possible impact on collective bargaining

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31%

10%

40%

5%

15%

0% 10% 20% 30% 40% 50%

No impact

Negotiating savings not

a priority now

Somewhat more likely

Significantly more likely

Already contributed to

negotiating savings

Perceived impact of tax cap onchances of negotiating cost-savings

with teacher union


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27

Implementing evaluation reforms(pages 24-27)


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98% of superintendents say new evaluation

requirements will require additional spending

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70%

28%

2%

0%

0% 20% 40% 60% 80%

Significantly increase spending

Somewhat increase spending

No signicant effect

Reduce spending

To what extent did complying with the new APPRrequirements require your district to increase what itexpects to spend on teacher and principal evaluationbeyond

what it would have traditionally spent?

Staff training and new

student assessments are

seen as the primary cost-

drivers


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Requirements will pose significant demands on

principals

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0%

8%

19%

32%

41%

0% 10% 20% 30% 40% 50%

Under 10%

More than 10%, up to 20%



More than 40%

Approximately what percentage of a typical principal or

other administrator's timedo you anticipate will be spent onconducting teacher evaluations in compliance with the new

APPR requirements? 41% of superintendents believe new

teacher evaluation requirements will

demand more than 40% of a principals

time.

Proportion might be appropriate but

districts have been cutting administrators

and the state has been adding

responsibilities (e.g., preventing/

stopping bullying).


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30

Looking ahead(pages 22-24)


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Which is of more concern the tax cap or possible state aid levels

There has been about a 20 point shift toward state aid since last years survey

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25%

13%

54%

37%

23%

12%

16%

5%

52%

43%

39%

53%

60%

49%

54%

37%

23%

44%

7%

11%

18%

39%

31%

58%

0% 20% 40% 60% 80% 100%

Total 2011

Total 2012

Downstate 2011

Downstate 2012

Mid-Hudson Valley/Capital Region 2011

Mid-Hudson Valley/Capital Region 2011

"Upper Upstate" 2011

"Upper Upstate" 2012

Tax Cap Equal Concern State Aid


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Priorities for state help on mandate relief/ cost containment/

productivity (top 12 of 25 listed options)

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Options 1 2 3 4 5

1 Amend the Triborough law to eliminate automatic salary

increments if a collective bargaining agreement has expired

107 30 20 9 14 747 73%

2 Establish mandatory minimum employee and retiree contributions

for health insurance

48 69 20 13 7 609 64%

3 No new unfunded mandates 30 22 22 19 43 385 55%

4 Reduce the role of seniority in layoff decisions (i.e., modify "last in,

first out")

9 27 19 17 12 256 34%

5 Require all public employees in a region to belong to a singlehealth insurance program

11 22 20 3 3 212 24%

6 Authorize the State Education Department to order school district

mergers, without voter approval, based on considerations

including local financial capacity and inability to maintain

comprehensive educational services, following a review with local

input

9 5 15 10 9 139 20%

7 Revise middle school requirements 3 5 11 18 13 117 20%

8 Authorize regional high schools to serve students from multiple

school districts

6 8 10 8 5 113 15%

9 Other change in health insurance 2 6 14 8 8 100 15%

10 Revise special education class size requirements 4 3 12 10 11 99 16%

11 Streamline procedures for tenured teacher hearings ("3020a

reform")

1 6 12 12 8 97 16%

12 Reduce reliance on "seat time" requirements in high school by

allowing students to earn credit by demonstrating proficiency in a

subject instead

0 7 6 13 21 93 19%

Looking at the list below, what would be your top five priorities for actions the state could take to help

your district reduce or control costs, or gain more impact from its spending?

Rank WeightedScore

% Citing asa Prioriity


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Priorities if new funding became available 2011 vs. 2012

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2011 2012

Increase extra help for struggling students 64% 66%

Reduce property tax levy 57% 38%

Increase enrichment/advanced classes 23% 37%Reduce class sizes 30% 26%

Increase funding of reserves 29% 27%

Expand professional development 28% 28%

Increase other student support services 24% 21%

Strengthen administration (district or building level) 9% 17%

Purchase technology 12% 16%

Improve maintenance 10% 8%

Purchase other instruction-related materials 10% 7%

Expand extracurricular activities or athletics 3% 5%

Other 2% 3%

Purchase other equipment 0% 2%

If your district were to receive an increase in funding beyond what would

be needed to fund state mandates and your current level of services, what

would be your top three priorities for the use of that funding?

% of superintendents

choosing as a priority

Extra help for

students #1 both

years.

Reducing property

tax levy declined,

increasing advanced

classes rose.


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2012 school finance survey presentation

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