As the HCPSS budget work session comes closer to the final vote (scheduled to happen on 2020/6/18). Here is the document the board received.
This is the document shared from the county government during last Friday’s (May 1, 2020) County Council budget work session.
We are facing a tough and uncertain fiscal situation for FY 2021. However, where to cut/shrink spending, save money and how to get more revenue are up for debate. Here is the detailed written report.
2020-3-30 Howard County Budget Testimony
My name is Chao Wu. I am a member of Howard County Board of Education.
Before I begin my testimony, I would like to express my sincere appreciation to our County Executive Dr. Ball who has worked with the school board to develop a solid plan to address the historical health fund deficit issue. My family and I, along with all Howard County residents, also appreciate very much our county government’s tremendous effort in addressing the coronavirus crisis. Unfortunately this epidemic will most likely incur additional pressure on the county’s budget for next year.
The board is united in our commitment to bring down the health fund deficit with a clear path and vision. However, I am here today to testify not as a board member but as a parent.
First, I would like to point out that without extra money coming into HCPSS, it would be extremely difficult in keeping class size small, paying teachers well, improving special education and maintaining academic excellence.
HCPSS is in a crisis mode where schools are overcrowded, buildings lack maintenance and resources are needed everywhere in the school system. The recent need on Technology also highlights our long-term underfunding issue in this aspect. HCPSS has a 500 million deferred maintenance list and many large capital projects : High School 13, Hammond High, Talbott Spring Elementary, and Turf Valley Elementary, Dunloggin Middle. The list can also go on and on. When HS 13 opens in 2023, we will probably need another extra 10 million dollars for its operating cost.
Second, with the HCPSS budget crisis, I believe our county government should not operate as business as usual. In my opinion, the county budget needs to shift its priority to the education of our children. The county needs to shrink its spending in some other areas and increase the share of spending for HCPSS.
I ask the county to have a thorough cost and benefit analysis for each project. We need to differentiate the Needs and the Wants. There are several big projects that in my opinion belong to the category of Wants. They are ranging from 15 million dollars, to 60 millions, 80 million dollars, even to more than 100 million dollars in the county’s budget book now and in the future.
In addition, since public libraries in the digital age will have less physical books, their space could be used as a community center for our kids, parents, seniors and community groups. To save cost, the relocation and rebuilding of the central library, or any future library renovations should be incorporated with a community center concept, vice verse. I would also suggest that the county could collaborate with Columbia Association or other partners to offer services for our residents instead of building our own facilities.
At the same time, please slow down residential development since our school capacity could not catch up with the pace of the rapid development. I sincerely hope the county government and the county council eventually find the balance on this most pressing developmental issue our county is facing now.
Our school system is one of the greatest assets for our county. With ever growing budget constraints, we would not be able to keep our renowned world class high education standard. The school system’s reputation is the single most important factor that Howard County is able to keep attracting more families to move here. About 41% of our county revenue comes from property tax and 49% of it comes from personal income. If these two revenues drop because of the deterioration of the school system, our tax base will decrease and eventually everybody will suffer.
Howard County is at a critical moment. Our school’s good reputation is on the life line now. If it starts going downwards, it would be very difficult to reverse the trend. We have witnessed this alarming pattern in some neighboring counties. We need to work very hard to avoid this disaster happening in Howard County.
Please invest in our County’s future! Please invest in our school system!
HCPSS is asking 7.2% funding increase from last year’s budget, plus one time funding (6 million) request to narrow down the historical health fund deficit from the county government.
HCPSS is at the receiving end of the budget. With limited money allocated into HCPSS and the high possibility that the county may not fund this 7.2% funding increase request, we have to juggle around different programs and different priorities. If HCPSS does not get this number or get a substantially lower percentage than the request, further proposed changes of HCPSS program will happen, painfully and unfortunately.
The board has received many emails about “do not cut”. Parents do not like class size increase. They want to have special education fully funded, and have our GT programs and music programs enhanced. I also think we should hire more teachers, paraeducators, counselors, ,psychologists, nurses, health assistants, etc., to support our students and our teachers and staff. And we should have more liaisons to support our parents to connect with the school. There is a long list with many wants.
However, it is extremely difficult to find a balance among so many priorities in the school. It may have negative consequences on some of students, teachers or staff. For example, increasing class size will bring more pressure to the classroom. Reshaping some programs may impact some staff.
If any program changes have to happen, I will focus on the programs which are relatively easier to be restored if more funding becomes available. For example, class size change can be restored if the money comes. It happened last year. Surplassing teachers or cutting programs should be the last resort. I will continue to ask to streamline our central office and consolidate services to reduce cost. I want to put our resources in the classroom while maintaining a functional school system.
However, the reality is very challenging. Because of many years’ underfunding for HCPSS, we are at a crossroad to keep a prestigious HCPSS education system. The whole county needs to work together, and re-orient county priority and put more resources into the school system.
Parents, please do your best to advocate on behalf of our kids’ education at the county government budget session and the county council budget session.
Elected county officials, please examine the county budget and see where some county programs can be scaled back at this difficult time and have the fund repurposed to HCPSS.
County Executive 2021 budget Public Hearing
Time: Thursday, March 12, 2020
County Executive will submit Proposed Budget to County Council on April 20, 2020. This is a critical date for HCPSS FY 2021 operating budget.
County Council 2021 budget public hearing
Wednesday, April 22, 2020,
Wednesday, May 6, 2020
Monday, May 11, 2020
The County Council will adapt their budget on Friday, May 22, 2020.
The Board of Education will adopt the budget on Thursday, May 28, 2020.
Here is a comparison by Category among five MD counties: Howard, Montgomery, Baltimore, Frederick and Anne Arundel.
In terms of administrative cost, HCPSS is on the average. Community Service, HCPSS is an outlier.
Now more parents understand that HCPSS will face another tough budget year of 2021. Even before the superintendent presents his budget to the board, the board begins to receive many feedback from the community.
With the permission from the original sender, here is one email talking about the 2021 budget. Some of the points are very thoughtful and useful. At such a difficult budget time, every penny is important to HCPSS.
The document talks about cost saving measures related to: testing, renovation, printing, textbooks, busing, building usage fee, staffing formula, technology usage, etc.
Our auditor Cohn Reznick has informed HCPSS that HCPSS CAFR will likely include a “GAAP” departure, which includes a qualified or adverse opinion. This change may impact our county’s AAA bond rating, which means the county may borrow less with higher interest rate in the future.
So HCPSS will work with the county executive and the county council to create a concrete, workable plan to reduce the health fund deficit and avoid another adverse opinion next year. Three parties should be on the same boat for this crisis we are facing now. Otherwise, this will tirgger down and impact many people.
The reason for this adverse opinion is that HCPSS was not able to reduce health fund deficit. Health care claim for FY 2019 were 10.2 million over the budgeted amount of 130.6 millions. Even after some internal fund transfer, the deficit grew from 37 million to 39.2 million. During the FY 2020 budget cycle, a one time 12 million dollars, that was planned and supposed to be used to reduce the heath fund deficit, was used for FY 2020 operating cost such that the auditor failed to see HCPSS to have a plan and execute the plan.
Attached please see the memo BOE audit committee discussed with our auditor.
This was posted on my facebook. I think I should post it here too. The post was updated on September 10, 2020 based on staff info.
Many people asked me on school budget. Here are numbers(estimated). We will get better estimate during budget work session on 4:00-6:00PM September 10, 2019.
The school needs balance its’ budget such that we spend what we have.
For Fiscal Year 2021, starting from the beginning, we need extra 12 million for operating budget which is from this year deficit (we are funding some operating budget this year with one time funding), 10-11 million due to extra student growth(800 students*15000 per year=12 million), 25-28 million for teacher and staff salary increase (negotiated 4% as last year, not approved yet), 7-8 million dollar health care cost increase.
Furthermore, health care fund still has that 37 millions deficit hanging there. This 37 million dollars maybe go up/down. We will get an update on this number by the end of September 2019.
So in total, we need extra 59 million for operating budget, one time 37 million to pay down health care deficit. So the total is around 96 million dollars at least.
Other obligations that we know will have a budget impact but do not have estimates at the this time:
- Transportation contract costs(no-redistricting related)
- Dual enrollment FARMS tuition increase
- Non-public placement
- Insurance/Risk management
- Special Education
Thinking about during this year’s budget discussion, we were looking at saving 10,000 here and there. We are not sure how the economy will turn out in the next 12 months. We are also not sure how much the county and state would love to fund HCPSS.
We have a really tough, tough 2021 budget in front of us. I love to hear your ideas how to balance the budget.
It is my first school budget. The process is painful and the result is painful.
It was so painful that I have to see so many dedicated technology teachers, math support teachers, reading support teachers, math instruction support teachers, and paraeducators will lose their positions due to our vote. Fortunately they will not lose their job and income.
It is not your fault at all. When a math resource teacher called me and cried, I really don’t know what to say that point. We don’t have much choices.
increasing class size, cutting music teachers, cutting GT teachers , cutting technology teachers, cutting paraeducator, cutting math support teachers or reading support teachers or more. There is no good choice and we have to balance the budget.
I am looking forward to seeing how to make next year budget better. The reality is very tough. We will have a 37 millions dollar health care deficit and around 12 million dollar operating budget deficit starting at our next budget discussion.
We need revenue and find efficiency. We need clean our house first before any new initiatives.
- Managing our temporary worker system will bring some money.
- Charging daycare center running on school facility will bring some money. Right now, the rent is 1 dollar.
- Charging some school facility usage fee will bring some revenue
- We need increase school fundraising effort. (added after the post loaded here)
- We need examine every aspect of our operation.
- We need figure out how to increase our starting teacher salary to 50k to make our salary competitive . We need examine our health care benefit and reform it, and make it more sustainable as soon as possible. Our teachers and staff need our support.
- Running a school system is also like running a business. We need find efficiency. We need find result. We need innovate.
Furthermore, we need our county executive and county council’s continuous and strong support.
- We need increase our development impact fee to at least 8 dollars per square fee, which is still lower than neighboring counties. This will bring tens of million dollars to the county revenue and ease the school over-crowding a little bit. This will decrease our need to rely on debt to fund county capital budgets.
- If people consider increasing property tax and other tax, please make sure the development impact fee will be increased first
- also make sure the increased revenue will go into education. We should always be mindful increasing tax will create an extra financial burden to many families too.
The school system can only do so much with limited revenue. I will make sure our school system will not go back to the same faulty path as previous school administration.
We don’t have a rosy road ahead of us at all. Let’s all work together to fix the problem, bring our school back to the right track gradually and still be one of the best.
Our students are counting on us. Thanks.
Make tough choices and share the burden together
I would like to tell a story: A poor family had five kids. One year, there was a shortage of food because of the natural disaster. They had to make a tough choice:
- Every family member had less food and work through the tough year together.
- Give two children to other families such that with less people they can have more food for each remaining family member.
This was a true story happened in my “Wu” family two generations ago. Due to severe food shortage, one of my grandfather’s brother was given to another family and even changed his family name. It was 70 years ago. My great grandparents regretted that decision when the family condition changed for better later. Now all of them experienced that passed away.
Now 70 years later in Howard County, we are facing a very tough budget shortfall. At the same time, we are facing a tough choice. Are we going to surplus our teachers out, who are our best assets and make our classrooms even more crowded, or all of us stay together and find a way to get through the tough time? Or every stakeholder shares the burden collectively?
Wednesday afternoon’s work session on the FY2020 school budget was tough. After the discussion, here are some highlights:
- After the discussion, increasing class size by 2 and surplusing teachers (123.7 cut: elementary technology teacher from 62.2 to 42; music teacher from 52 to 26; GT elementary from 79.5 to 42; GT middle from 60 to 20) and para-educators (104 cut: elementary paraeducator from 216 to 132; middle school math paraeducator cut 15, middle school reading paraeducator, cut 5), are on-hold with a 10 million dollars deficit. There are a small number hiring increase (para-educator) in several areas too because of cutting teachers.
- At the same time, we are increasing the health care deficit with another 7 million dollars to 44 million dollars next year. We are creating an operating budget deficit for FY2021 since we are using a 10 million fund balance to fund incurring operating cost.
- We are not able put extra fund on the student mental health and well-being, restorative and inclusive support. program innovation, deferred maintenance and balancing capacity and changing school start time.
- We are now waiting for the county council to give us extra 10 million dollars if they can.
- The school budget discussion will be difficult for this year and many years forward.
Here is document: 05 08 2019 Budget Work Session Document
The link is here:
The board received many emails about the school budget proposed by the County Executive. In those emails they talked about a 30 million dollar increase on the operating budget over last year. This is not true. The increase is 0.9% percent and the amount is 5.14 million dollars.
Here is Howard County Proposed. FY2020 budget: https://cc.howardcountymd.gov/Portals/0/FY2020%20Proposed%20Operating%20Budget-web.pdf
On page 22, we have the numbers:
It is a tough year for the school board and the county government. Since the county executive’s operating budget was out already, we need convince the county council to allocate extra money for the school system.
The school system needs to balance the budget. Here are some big numbers:
- There is a 37 million dollar deficit in the health fund which we need pay off. In 2020 we need spend extra 7 million dollars on the health care fund in order not to increase the deficit.
- There is an increase of around 800-1000 new students into HCPSS. For each student, the county spent around 11k ( total is around 15,476 per HCPSS student) and the total net increase on spending by the student enrollment increase is around 11.5 million dollars (10.3 M for staff increase and 1.2 million for transportation) .
- We have FY 2019 negotiated salary increase for teachers which is 6.7 million dollars. This has to be honored.
- We have another negotiated salary increase (@3%) for teachers which is 19 million dollars. For the same reason, we have other salary increase for non-teachers which is 3.1 million dollars.
- We have non-public placement for special education(new enrollment?), which is 3.8 million dollars.
- Other materials of instruction and operations of plant are around 2.5 million dollars.
I can assure you that increasing the class size will be the last choice for the board. Increasing class size by one will save 6.5 millions dollars.
The board will have another work session on May 8th, Wednesday 4:00-6:00PM.
This is a summary for people to understand the current budget quickly.
I am a little disappointed that redistricting tool and transportation routing are in the optional category. I am glad they are included in the budget with my push, but they are still not receiving enough support. Starting high school late, bus route optimization and student safety, school redistricting require us to have the necessary tool and software to get it right. Without the right data to support, it is hard to make the right decision.
Here is an article “Why UPS drivers do not make a left turn” https://www.businessinsider.com/ups-efficiency-secret-our-trucks-never-turn-left-2011-3.
At the same time, please read my original post from the 2020 County Spending Affordability Advisory Committee report: https://chaowu.org/2019/03/05/2020-county-spending-affordability-advisory-committee-report/.The county projected revenue growth is around 10 million dollars.
We are in short of money to provide the same level of service for our school system. We need innovate to educate.