It’s very nice to be back and into a new school year. The summer has been filled with many activities and charged with lots of excitement, emotion, and many difficult decisions. You, our employees, make all the difference in the world and repeatedly demonstrate why people love to live and educate their children in Jordan School District!
One of the most frequent questions I am asked is, “What about education funding for next year?”
Everything I receive from the Legislature indicates there will need to be additional funding reductions next year. The most frequent amount used to describe the size of next year’s deficit is $700 million. We are being encouraged as a District to maintain reserve accounts wherever possible and prepare for possibly several years of reduced State revenues. I also urge caution when listening to news reports that say the recession has “bottomed out.” Economic indicators viewed in isolation can be misleading as to the overall state of the economy.
As a District, we need to anticipate various financial circumstances that could present themselves. We cannot completely rule out mid-year reductions in funding if second and third quarter revenues are down from projections. However, we are encouraged at the State’s projected revenues during this period of time which would be sufficient for this year’s expenses. We will be working on options and strategies in the event the State were to reduce the value of the WPU mid-year, or cut additional categorical funding to our District this year and next.
The District financial condition is stretched to its limit. Our financial needs are in excess of $30 million for this school year. Through property tax increases, use of fund balances, reductions in staff, and other budgetary action, we will neutralize this deficit for this year, but still need to be very proactive in anticipation of another year of state funding cuts.
Everyone is focused on the economy. As the economy goes, so goes much of the funding for education. There are lots of places to watch. Some watch the stock market. Others watch federal economic recovery appropriations. Still others watch unemployment figures. I spoke this past week with colleagues in California, Nevada, and Arizona about their state budgets and the impact of education. Oddly and thankfully, I came away with a definite awareness that “things could be worse – much worse.” In the midst of our own financial deficits, comparisons of financial woes don’t really make anyone feel better.
Right now, I am staying very focused on our State Legislature and Governor Huntsman. So many things are in a state of flux right now that it’s nearly impossible to know exactly how this and next year’s budgets will be adjusted.
The State has some financial flexibility with funds appropriated to build roads, bonding options, distribution of surplus funds (rainy-day funds – - – hello, it’s raining), anticipated federal economic stimulus funds, and unallocated one-time funds from this year. Everyone seems to have a different way of putting this all together in order to point us in a clear financial direction.
As a District, we are being very fiscally conservative right now, even a little stingy. We are aware of general adjustments that could be made, but haven’t become specific at this point. Whatever resources we have, we want to be sure they are used in the most productive manner. I, with you, would really like to know what we need to do financially this year and begin to prepare for next year, but we don’t have much to go on. So we watch, wait, and evaluate our response to possible outcomes. For now, waiting for more information and details is an O.K. place to be.
By the way – no news yet on the Arbitration Panel decisions regarding assets or a ruling from the 10th Circuit Court of Appeals in Denver on the Herriman City appeal.
Welcome back! I like being away. I also like my work and enjoy getting back to a familiar routine.
January brings some important issues to watch. First of all, I anticipate a decision from the Arbitration Panel on the division of district assets within the next two weeks. Those decisions will determine which district holds title to buildings, property, furnishings, vehicles, and the percentage of cash within the existing District funds.
Also, on Jan. 14 the Herriman City appeal of a Utah Federal Court ruling will be heard in Denver. This appeal relates to the constitutionality of the process by which Jordan District was divided. It’s uncertain when a ruling on the appeal will be issued. It could be several months or many months. No one seems to know for sure.
Another important activity to watch is the workings of the Utah Legislature. They begin Jan. 26 and conclude March 12. The big question on everyone’s mind is what the State budget for next year will look like. I anticipate the Legislature will adopt a reduced budget from this year during the first week of the session and will adjust the allocations up or down depending on updated revenue figures received in mid-February. I’m encouraged by Governor Huntsman’s continued emphasis on the need to keep education funds constant (at least minimize any reductions) and look for ways to increase teacher compensation over the next several years.