Lindbergh’s state funding cut by $64,542 for current year

Shields’ legislation has potential to cut Lindbergh’s state funding by $500,000.


Lindbergh Board of Education members last week received more bad news about the district’s finances.

At the beginning of their April 13 meeting, Superintendent Jim Simpson told board members district officials were informed earlier that day Lindbergh would lose $64,542 in state funding for the current school year.

“… Yesterday we had $64,542 in our revenue that we thought we were going to receive from the state of Missouri and we were in-formed today that that’s not going to be the case, and so we’re $64,542 less that we thought we could use to run this district,” Simpson said. “And so, continuing bad news. I’m looking forward to someday having a financial notification of more money, not less …”

The district’s long-range financial plan calls for a spend down of its $24.6 million in reserves with a deficit-spending cap of $3 million per year. In June, the school board adopted a 2009-2010 operating budget that projected a deficit of $3 million. That $3 million deficit was reached by making more than $2 million in reductions for the current school year.

But a further decline in the assessed value of commercial real estate — including successful appeals by commercial property owners to the county Board of Equalization — increased the projected budget deficit for the current school year to roughly $5.1 million, not including the $64,542 cut by the state last week. Officials plan to further utilize district reserves to cover the increased deficit, and projections indicate those reserves will drop to roughly $19.5 million at the end of the current school year. If re-serves fall below roughly $13 million, the district would have to borrow money to operate.

Board members voted unanimously last month to approve more than $4.7 million in reductions for the 2010-2011 school year. The board’s action eliminated 60 positions, including 45 teaching positions. But even with the $4.7 million in reductions, the district still faces a $3 million budget shortfall next year as part of its long-range financial plan.

And Chief Financial Officer Pat Lanane told the Call that legislation being considered by the Missouri Senate has the potential to cut up to $500,000 in state funding for Lindbergh next year.

Sponsored by Sen. Charlie Shields, R-St. Joseph, in response to the state budget crisis, Senate Bill 943 would adjust the phase-in of full funding for state school districts. But Lanane said the legislation includes what he is terming a “super penalty” for roughly 16 hold-harmless districts such as Lindbergh.

“… Sen. Shields, who is president pro tem of the Senate — the most powerful man in the Senate — introduced a bill that does a number of things, but the piece that we are really upset about is it talks about how funding would be reduced next year,” he said. “And it talks about if there’s new funding, here’s what happens. Well we all know, there isn’t going to be any new funding. So then it talks about if funding is less than the 2010 level, here’s how the reductions occur.

“And the first step is that here are 16 districts because their local effort is high — meaning they’re getting lots of money locally — we’re going to put a super penalty on them … If they’re reducing next year, they’re going to take a 10-percent penalty first before anyone else in the state and then the amount left over we will proportionally prorate to people. So I’m calling it the super penalty.”

Lanane estimates state funding for schools will be reduced by 4 percent to 6 percent for next year. If that occurs, Lindbergh’s state funding would be cut by 14 percent to 16 percent next year if SB 943 is approved.

“That’s pretty shocking when you put it in that term,” he said. “And here’s what’s even more shocking — when I’m talking about this I’m not even talking about the first piece, which is since 1977 hold-harmless districts have not had to share in any prorations. And here’s the reason: We haven’t shared in any new revenues. So if you’re not going to give us new revenues, why in the world would we share in prorations or reductions of revenues we never received? When you first look at it, on the surface it’s like: Oh, we’re all sharing in this equally. Well that would be OK if we had all shared in the revenues equally. But we’ve gotten some pittance. They tried to buy us off basically with $90,000 phased in over three years — a net $270,000. So they gave us $270,000 for this new formula while they were giving single districts millions of dollars …

“The governor hit us $64,000 this week and now the Senate is trying to hit us for $320,000. And then we know there’s going to be a proration that we’ve never had before because we’re a hold-harmless school district …,” Lanane said, noting each 1-percent proration equals $32,000. “So it’s very possible that under that that (SB) 943 as it’s written right now, we could see another hit of $500,000 — very easily. Almost certainly actually.

“While it’s a kid issue, here’s the taxpayers’ side of it. Our taxpayers faithfully pay their income tax to the state of Missouri and they have some reason to believe that when they pay those taxes they’re going to receive back something from the state. They know they’re not getting a dollar back,” he said. “They already know that. That’s a sad fact that anyone who lives in St. Louis County has come to that realization years ago that you pay so the rest of the state can have services. This just made that imbalance worse by $320,000, plus the other 1 percent, 2 percent, 3 percent, 4 percent they’re going to take because we’ve never had to do that. That goes all the way back to 1977. What a promise to break …”

In a separate matter April 13, the board voted unanimously to approve a salary and benefits package for the 2010-2011 school year that provides a 1-percent raise for teachers.

A three-year agreement between teachers and the Board of Education approved last November includes an annual review of salary, insurance and tuition reimbursement.

The revisions to the salary schedule and benefits package were approved by a roughly 9-to-1 margin with 155 teachers in favor and 17 opposed.

The more than $4.7 million in budget reductions approved by the board last month were premised on the possibility of a 2-percent salary increase, but the amount of the pay raise would be determined based on the outcome of negotiations between the Board of Education and Lindbergh National Education Association teachers. All employees, including administrators, will receive the same salary increase as teachers.

By agreeing to a 1-percent pay increase, LNEA teachers sacrificed taking home more money in exchange for allowing six full-time classroom teaching positions — a total of seven teachers — to be reinstated, Assistant Superintendent for Personnel Services Rick Francis told the board.

While the district will continue to pay the cost of insurance for employees, premiums for spouse and family coverage increased by 4.5 percent. In addition, teachers’ contributions to the Missouri Public School Retirement System will increase to 14 percent of their salary from 13.5 percent.

“… For most teachers, this salary schedule really becomes a break-even salary schedule,” Francis said. “Basically for most teachers, it’s a wash because the net take-home pay for many teachers will be about the same as what it is this year because teacher retirement — mandated teacher retirement goes up … as well as increases to insurance for teachers who are paying for their families …”

The agreement also provides that the amount for tuition reimbursement for graduate credit hours for a master’s degree will be decreased.

“… By having employees take a smaller raise, it allows us to bring back seven teachers that we had informed that we would not be able to bring them back because of the financial situation of the district. So certainly the kids are the winners because this allows us to bring back teachers, which lowers class sizes …,” Francis said.

Board of Education President Ken Fey said, “… On behalf of the board, I would like to thank the LNEA representatives for a smooth negotiation process and a quick resolution to the compensation package for next year. So thank you very much.”