SKSD Board Member Explains “Reprogramming” Levy Funds

Got a comment today from reader Ed Sampson about the story I wrote on South Kitsap School District’s budget.

The paragraph he cited was :

“Around 18 percent would come earmarked for “public safety and other government uses” and could be used for construction and renovation projects, such as the replacement of the Orchard Heights Elementary roof.

District officials had planned to pay for the $1.4 million roof project with a levy South Kitsap voters approved Feb. 3. Stimulus money would allow those funds to be used elsewhere.”

Ed said:

As a concerned citizen, I am at the end of my rope of any agency, be it schools, etc. of seeking funds voted by the public for at stated reason and then the funds are diverted “elsewhere” for other uses.  I voted for these funds to be used for a given purpose according to the information provided to us when we voted for/against the school levy in the election.  The funds being approved need to be used ONLY for that purpose.  If they are used elsewhere, that boarders on illegal and un-ethical.  If the funds are to be used elsewhere outside of the information supplied at the time of voting, then that action needs to be first voted for/against by the public and the levy for the school money needs to be adjusted accordingly.  It is time for the public to take back control of our all our government representatives be it at the Federal, State or Local levels.  Accountability is badly needed at all government levels.

I do hope to see in the future where our local level officials will also go to the Federal Recovery Stimulus web site to add in where they spent their Stimulus funds.  We might even be able to see where they “diverted” some of the school levy funds to another “project”.  But I will not hold my breath on that one.

Ed Sampson

I summarized Ed’s comments for school board member Kathryn Simpson and asked if she could respond to his thoughts. I picked on her because of her history of willingness to publicly jump into the fray where debates over district issues are in question. Kathryn, speaking as an individual and not representing the board, said:

Hi Chris,

Reprogramming (moving from one pot to another) of approved levy funds do not require a vote of the board. However, since the district’s budget is approved by the board, any change in revenue and expenditure would be approved by the board and the board expects to be informed and involved in such fiduciary decisions. This has been past practice and I have no reason to believe it wouldn’t be continuing practice.

As you know, SKSD formalized the levy plan in October.  This was well before the “stimulus package” conceptual ideology was even remotely coming into focus. Further, education funds were amongst those being hotly debated at the tail end of formalizing the final package.  Finally, the end product of these federal debates, now known as the “American Recover and Reinvestment Act” (ARRA) didn’t become law until after the February levy vote.

In fact, we won’t even be clear on what upside fiscal impact ARRA might (stressing the ‘might’) have.  From what I can see, it may prove to be little more than a backfill of funding that will be taken away by the State of Washington due to the potential $10 Billion dollar deficit the State is now facing.  Much discretion is being given to the States to decide whether the stimulus funds will raise funding levels (temporarily) or simply facilitate funding levels to remain somewhat constant because of the battering many state economies are facing (including Washington State) and the resultant cutbacks they may be making to education budgets.

I hope that helps adequately addresses the question and concern.  My comments, of course, of those of one member of the board.  I would strongly encourage anyone with questions and concerns to come to a board meeting and express their concerns to the board so that the entire board can respond and be better informed about constituent concerns.

Regards of the NW,
Kathryn Simpson

13 thoughts on “SKSD Board Member Explains “Reprogramming” Levy Funds

  1. Is the “one pot to another” levy pots? Is the reprogramming limited to need items specified in the levy vote? Are you able to reprogram funds to needed areas, areas not addressed in the levy literature, regardless of the levy’s stated intent for those funds? Or maybe the language in the levy is general and inclusive enough to sanction using funds for any and all expenses incurred by the school district?

  2. I’m not saying that very well. Is the campaign language regarding the need for funds and their intended use ethically or legally binding?

  3. Karen,

    You have seen me point out in these blogs that SKSD goes above and beyond just about any district in the state to itemize where the levy funding will be used. Certainly, in my mind, doing that creates an ethical accountability.

    That being said, legally, we have the flexibility and latitude to reprogram approved levy funds as needed and appropriate. Sometimes things happen that require changes to even the best of plans. If we didn’t have such flexibility, what would we do when change occurs and we must respond to it?

    Regards,
    Kathryn Simpson

  4. Kathryn: I appreciate your work with the school district and the open communication. I was privately cheering for you during that debate w/ Ironhorse, mrours, and a couple of others before the levy vote. I thought you were going to throw the towel in at one point.

    I voted for the levy, we vote yes on school bonds and levies.

    Regarding the accounting. Are you able to pull out a figure, for instance, on how much is spent on the football program each year? How much does the program bring in? I think the way it’s set up, with ticket sales going into ASB, can you tell what it’s costing to run that program? All the costs are separated out into different accounts. Salaries, transportation, etc…Do you have a total figure of what it actually costs to offer that sport at the high school? I don’t care what that figure is, but I do think the School Board of Directors should have it when they are sitting down to talk about budget cuts.

  5. Karen,

    I don’t have the current figures handy. However, I have looked into it before and found that the gate sales from football far outpace the cost of the program. That means that football actually supplements other athletic programs that don’t have the same ‘ticket draw’ or attendance at games.

    I can certainly obtain the latest numbers and email you, if you like.

    Regarding the recent debates… thanks for the kind words. I think folks deserve conversation with their elected officials. We won’t always agree, just as I don’t always agree with school administrators. But the conversation is important. I’d chastize some for being out of line from time to time, but it was rightly pointed out to me, yesterday, that we all suffer from bad communication mistakes from time to time. I had a doozie earlier this week in a private conversation that I need to make amends for.

    A full life includes victories, defeats, and (hopefully) long periods of peace and harmony in the valley.

    Regards,
    Kathryn Simpson

  6. Smoke and mirrors. All the effort to pass the levy with piles of information and web based date for the taxpayer. Now, things change. With proper “flexibility and latitude” I guess I could say one thing and mean and do something else. SKSD has the money for the next four years and the taxpayer and voter is out in the cold. The money can go anywhere, for anything the board deems needed. Then in four years, actually 3 when they start the drive, we will here the cries “for the children” again. Declining enrollment, declining economy, but still the belief we must never cut back what we have. Always budget for more teachers, retirements, new buildings, and of course hundreds of “old” out of date computers. Stimulus money could be used to reduce the next levys cost by proper planning a budgeting, but no. We will spend it in place of taxpayers funds and then use taxpayers funds for more of the wish list the board has had in mind since the change in how levies are passed. I think the smoke and mirrors we will see in the next SKSD levy will be very interesting.
    Roger Gay
    South Kitsap

  7. Roger,

    There are many necessary maintenance projects that didn’t make the current levy list only because we have a responsibility to balance the needs of the district with the needs of keeping taxation at a responsible level for our local taxpayers.

    Stimulus money, should it exceed what the state is cutting, will reduce the “needs” list for the next levy. However, there will still be more need than what we responsibly can balance with reasonable taxation and we will still be formulating a plan that will pit needs against needs. You can thank the cumulative effect of state and federal underfunding of K-12 education for the past 20 years for that.

    The “smoke and mirrors” isn’t a game played at the district level. It is a game played at the state and federal levels.

    Two quick examples…

    It made me angry to see that it took a national economic crisis to get TEMPORARY additional funding in IDEA (Individuals with Disabilities Education Act)funding in ARRA (the stimulus package) that has been underfunded since nearly it’s inception. And still, ARRA doesn’t fully fund the federal obligation and previous commitment, even temporarily.

    The State of Washington has underfunded SKSD in pupil transportation costs that total more than $13,000,000 in the past 10 years. That is $13,000,000 with which we could have reduced our request of local taxpayers and/or done major maintenance projects.

    All the while, requirements of school districts and accountability have been on the rise.

    In formulating the recently approved levy plan, the SKSD Board debated what needs would and would not go into the request of the voters. Many needs were left off.

    What is being asked of SKSD is to provide a $12,000 per student educational program on an $8,500 per student budget. In an analogy that I use frequently, it is like tasking me to drive 3,000 miles from Seattle to Boston with a vehicle that gets 30 MPG and gas prices currently at $2.30 per gallon and only giving me a $164 budget. Simple math tells me the task will cost $230 just for gas. So, if I am required to do the task, I must get creative or I’ll only Chicago. We have a lot of creative people in SKSD who have never given up and get us a lot farther towards the goal than Chicago.

    So, when we get a little more clarity on the stimulus implications for SKSD, I hope we will see you at school board meetings engaging the conversation with us on how we can best be accountable, meet the needs of K-12 education in SK, and meet the needs of local taxpayers.

    Regards,
    Kathryn Simpson.

  8. I think the the business of public school finance is more about budgeting, forecasting, and raising funds, Mr. Sampson. It’s less about using historical data to see where you can cut costs or if a program is sustainable, because the goal of running the school district is not making a profit. It’s a social objective, educating children. The answer as to whether you’ve achieved your goals doesn’t come from the financial reporting, as it does in private industry, but from the data regarding student achievement. It’s complicated. Maybe the best thing to do is look at the budgeted items and then the actual figures and pay close attention to the areas where the variance is more than 1 or 2%. If something wasn’t budgeted for at all, the variance should be 100%.

    I think your idea about reporting where the stimulus funds were spent is a good one. Maybe that’s already a requirement. It should be.

  9. The Bremerton School District has formed the Citizens Finance Committee to educate those of us in the community who expressed and interest and were willing to spend the time on how this backwards, convoluted, hoop jumping, strings attached, lack of common sense, over-regulated process works.

    Here is one of the website links provided to us that I found to be particularly helpful in my own research:

    http://www.k12.wa.us/safs/FiveYearReports.asp

    You will need to type your District Number in the Green Box (Bremerton is 18100).

    Karen is right. It is not just about the numbers on these reports. It is also about how these numbers are working for the betterment and improvement of the student’s education. I can see where it is much easier for the general community to blame the school district for their need to ask for levy funds. When in reality it is the legislators who only pay lip service to fixing the problem or just sign junk bills that slap a band aid on it who are truly to blame. A true and legitimate fix to the core funding problems at the federal and state level will not happen until we force lawmakers to address it. Decades of incompetent legislation has purposely forced school districts into severely underfunded positions. Positions that force them to eagerly take garbage or junk money like the stimulus funds to meet legislated unfunded mandates instead of making the hard choice, with public support, to turn it away, tell lawmakers it is not right and force a change at the most core levels.

  10. Thank you for the link, Colleen. A little light reading.

    I wanted to add to my post that even if a budget item comes in exactly as it was budgeted, you would still want to check the revenue source or revenue stream to see if that was changed over the course of the fiscal year. Surely it would be noted somewhere.

    Cost accounting is a challenging endeavor in the private sector when you have hard, reliable, financial data and a single, easily identifiable source of revenue. It must be difficult to assign costs to a specific program or school offset by funds from various sources in public school accounting. It makes me wonder about that 12,000. figure per pupil noted above. Is that the actual costs, from the ground up, assigned to that student’s account? Or is it the aggregate cost of school district operations at the end of year divided by the number of students?

    Just curious. At the end of the day, you have to trust the people you’ve elected to administer the school district and the people they hire to manage it. That being said, I’ve noticed that some of the lack of support comes from being uninformed and excluded. Any and all information and discussion is good.

  11. Karen,

    The $12,000 was a round figure I used, based on my rough estimate, that is sufficient to ensure a quality education (in 2009 dollars) for an average student in a district about the size of South Kitsap.

    Colleen,

    It is easy to say, “don’t take the money and make them fix it”, until you realize that without those funds, the kids in our schools would be the ones suffering to the extreme and it could take years to fix. I am not willing to sacrifice the kids in SKSD to make a point that won’t be heard unless there is coalition of additional schools willing to exert sufficient pressure for immediate change.

    I am willing to use other pressure points, however. Such as the NEWS lawsuit that SKSD joined two years ago that is compelling the state to address the funding issue.

    http://www.waschoolexcellence.org

    Unfortunately, the timing is such that now that we have the state pressured to address the issue, but the state is facing a nearly $10 BILLION deficit. And yet at the same time, our state constitution is quite clear as to our “paramount duty”. Conundrum? The answer seems simple to me. Fund the priorities first.

    I have to wonder how much better off the State of Washington economy would be right now if we had front-funded basic education as our paramount duty. Would we need so much money for correctional facilities and courts? Would we need so much money for health and human services? Would we have such a rising unemployment rate?

    Regards,
    Kathryn Simpson

  12. But see that is just it Kathryn, the kids are suffering to the extreme either way.

    The kids could suffer if school districts and the public decided to take a stand and say NO to junk funding from our leadership. Junk funding (stimulus money) that still has no guarantee attached to it that it will actually make its way into a school district budget in a manner that can and will be used for the improvement of classroom education.

    The kids are already suffering and will continue to suffer in the manner in which you describe above when it comes to the federal and state failures, despite constitutional mandates, to fully front fund a redefined, accurate definition and description of “basic education”.

    So the conundrum is do we join together, stand up and make it one quick large bump in their educational journey or do we continue to constantly juggle and reprioritize needs in a way that only draws it out and breaks it up into a bunch of small bumps that eat away at their education throughout its entire course? The kids are losing either way. We as a society are losing by allowing it to continue.

    My respect and admiration to you always!

    Colleen

  13. There is a lot of merit to your comments, Colleen. Fortunately, I think the financial crisis is actually helping to underscore the need to adequately fund our priorities. Now if only we can ride out the storm as the details get worked out.

    Regards,
    Kathryn Simpson

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