Budget Workshop Part 3-Some Specific Changes

This is the 3rd and final installment of my budget workshop series.  Part 1 was a short entry where I commended the TSD Board for engaging in productive and informative discussions regarding the budget.  In Part 2, I outlined some “big picture” concepts, some which represent a change of course, when it comes to how TSD is approaching the 2019/20 budget.  In this installment, I delve into a few specifics.  As a reminder, the TSD Board engaged in an depth discussion about the budget as part of a budget workshop on August 8, 2019.  Video of the workshop is on the TSD website and can be found here.   


Salaries and benefits account for over 80% of the approximately $92 million($92MM) in expenses budgeted by TSD.  According to TSD, teachers account for about $40MM, while classified staff is another $16MM.  Employee benefits are roughly another $22MM.  TSD tried to reduce its expenditures by about $5MM this year.   When 80% of your budget is staff related costs, it is difficult to make any significant reductions without substantial reductions in staff costs. 

Accordingly,  TSD budgeted to Hold/Eliminate several non-teacher positions.  These include: 25 paraprofessionals, 3 maintenance, 1 Fiscal, 1 Human resources, 3 TOSA(teachers on Special Assignment—now being sent  back to the classroom) and 1 Technology position. It is possible these cuts can be adjusted in some regard.  The most impactful cut is likely the elimination of 25 paraprofessional positions.   

Paraprofessionals are a great resource for TSD as they provide classroom assistance to teachers, and in some cases can fulfill student/teacher ratios in overcrowded classrooms. They are not required to be certificated teachers, and are paid at a significantly lower rate than teachers.  Notably, the TEA/TSD contract, like most teacher contracts, actually requires paraprofessional assistance in the classroom in some cases(usually when classes are at impact–overcrowded).  Teachers can generally opt for increased compensation or paraprofessional assistance when classrooms are at impact.  

Frankly, TEA pulled off a pretty big victory on this one as TSD did not eliminate any certificated teaching positions.  The TSD/TEA contract requires TSD to send out notices of potential layoffs  to individual teachers no later than May 15th, and TSD opted not to send out any such notices.  Therefore, it was compelled to renew all teachers contracts.  Notably, the decision to lay off teachers did not have to be made by May 15th.  TSD simply had to notify teachers by May 15th if there was a possibility their individual contracts would not be renewed. 

From a budgeting perspective, this seems a little out of whack as certificated teachers are by far the biggest overall cost in the total budget.  It does not take much financial wherewithal to realize having your largest expense “untouchable” when drastic cuts are needed is not ideal.  To be fair, the decision was made before Superintendent Dotson started.  Highlighting the error was the fact that TSD learned shortly after the May 15th deadline had passed that it was going to get about $2 million less in hold harmless funds than it had already projected receiving, thereby necessitating even deeper cuts.  Here is the link to a blog I did on that decision back in May.  

It seems to me the prudent thing to do would have been to notify a dozen or so teachers that their spots might be eliminated, just to keep its options open.  TSD could have then opted to renew the contracts prior to the school year—once it had a better understanding of the status of the budget.   

I took issue with this move at the time as the decision to not even send notices eliminated the potential cost saving measure.  I am not saying teaching positions should have been eliminated, but there is no excuse for making such a consideration impossible knowing $3MM(which turned out to be $5MM) or so needed to be cut from the budget.  What ended up happening is that TSD scrambled to reduce the budget and was left with having to make all the staff cuts with Administrative and paraprofessional employees.   

In hindsight, this was even more problematic as, even with the cuts, TSD projects it will have a deficit of $1.8MM during 2019/20.

I would hope TSD will be a little more prudent during the upcoming year and at least send out notices if there is $3MM or so that needs to be cut from the budget.  Once again, the notices simply provide an option, and TSD could ultimately opt not to complete the layoffs.


Levies and bonds approved by voters can only be used for specified purposes.  Traditionally, TSD bond money has gone to Capital projects(maintenance, construction and improvement of infrastructure), and has not been used for salaries to any significant degree. 

TSD has broken with that tradition and will now pay some staff costs from the bond funds.  The effect is that TSD is going to shift about $750,000 from Capital projects, and instead use the $750,000 to pay salaries for those working on Capital projects.  This is a tactic being used by many school districts under the new funding model.  The theory being that funding the employees working on the capital projects is an allowable use of the bonds voters designated to be devoted to Capital projects.  I am unaware of any provisions within the law, or the bonds, that suggests this tact is not allowed.  

Of course, every action has an equal and opposite reaction.  The reaction in this instance is that there will be $750,000 less to spend on Capital projects.  I am unclear on how this will actually impact the Capital projects and may take that up in another blog.  Notably at recent meetings, the Board asked probing questions regarding “what is not going to be built/maintained/improved.”  I also imagine this will be part of the discussion the next time voters are asked to approve a bond.   Maybe voters do not care, maybe they want money spent on salaries, etc.    


One concern I continue to have is the expressed sentiment that we need, or desire, more students.  This is illogical to me.  I often hear the Board and administrators make comments like ”we hope enrollment increases.”  TSD should serve the students it has, and budget accordingly.   This sentiment appears to be based on a(1) a lack of recognition that increased enrollment actually increases the deficit, and (2) a desire to save as many jobs as possible, regardless of the economics.   

As I have pointed out, on a cost per student basis, the more students TSD has, the larger the budget deficit becomes.  The state is not giving TSD enough money for basic education. In general terms, TSD receives about $9,000 per student per year from the State under the current funding model, but it costs just over $11,000 to educate each student according to TSD’s budget.  In simple terms, the state is shorting TSD about $2000 per student and TSD has to go find that money somewhere else.  Here is a link to a blog that delves into the topic a little deeper.  

TSD currently fills the gap with a combination of levy money and dipping into the savings account.  Dipping into the savings account is not sustainable, and using levy funds is risky, especially given the fact the levy expires in 2020 and is dependent on voter approval of a new levy.       

Of course, TSD must educate the students who live within the TSD boundaries, and come up with a budget that does so.  However, TSD controls how many out of district students it enrolls.  As has been noted in the past, TSD has a disproportionate number of out district students(see blog here), for which it receives no levy money(those funds stay in the student’s resident district), thus creating an even greater financial burden  The deficit with Out of District students is probably closer to $3500 per student.  Either way, increased enrollment is a financial loss.   The TSD leadership’s desire for increased enrollment is contrary to basic economics. 

I believe the desire for increased enrollment is rooted in a “we need to save jobs at all costs” mentality.  I am not in favor of anyone losing his or her job, but staffing to demand is an economic reality of any responsible operation, including schools districts.  

Staff costs account for well over 80% of the budget.  In order to budget appropriately, fewer students creates a need to budget down, which inevitably will include fewer employees.  TSD reduced staff significantly over the last year, and still projects to run at a $1.8MM deficit. 

TSD has been reluctant to reduce certificated teachers.  TSD needs to appreciate the reality that it must operate within it means.  While there is no desire to have anyone lose a job, TSD should budget to reality, and not to some optimistic hope that enrollment is increased. This is especially true given the fact that we are educating students at a financial loss and more students increases the deficit.  

I think TSD should look to be the best, not the biggest.  I am confused as to the mindset of those who “hope enrollment increases” and/or seek to have a liberal policy when it comes to accepting out of district transfers.  Those individuals appear disinclined to accept the reality that the budget issues are not an enrollment problem, and, at least under the current funding model, increased enrollment actually exacerbates the budget deficiencies.      


 I had a discussion with Superintendent Dotson a while back wherein he indicated he felt IDT students could help with the budget to the extent TSD strategically accepted, and placed, those students.  This would be a welcome change of course as some schools(especially THS) choose to accept IDT student independent, and well in advance of any planning. 

During prior years, TSD did very little planning with respect to enrollment of IDT students.  My experience is that TSD accepts IDT students well in advance of having any ability to strategically place student with budget considerations in mind. Superintendent Dotson confirmed that he is hopeful, and will attempt to implement a plan, that monitors IDT students in a better fashion.  I have a public records request into TSD and will report back about the IDT student numbers for 2019/20. 

IDT students should be welcomed if, and where, there is capacity, but should not displace resident students.  I am hopeful that, unlike the prior administration, the new administration will take the needs of resident students into account as the primary determination with respect to IDT students.  


I only covered a few topics, which I thought might be of the most interest. In my view, the current TSD Board is much more engaged, and transparent, which allows more insight into the decision making process.  I will continue to blog about financial(and other) matters.  As always, we welcome your feedback.  

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