by Craig Hawkins, Communications Director

Friday, April 3, 3:25 p.m.

The group discussed a potential statewide strategy and a statewide "number" ranging from $5.4 billion to $6.2 billion.  Districts have different situations and different approaches, but the group seemed to agree that we should advocate for a number in the higher end of the range.  Everyone agreed, though, that districts have a need for planning at various levels, as well as a a need for community processes and thorough communication about impacts of the various funding levels.

2:45 p.m.

Kent Hunsaker shared the document, "Best Investment for Main Street? It's K-12 Schools." 

2:15 p.m.

Attendees encouraged Sager to work with the governor to provide greater leadership on the budget issues confronting schools, including working with employee groups to participate in finding solutions that preserve as many school days, classrooms, programs, etc., as possible.

1:57 p.m.

Key points from Paul Warner:

- The national economy is still contracting at a rapid rate, so things are very uncertain and it’s a very difficult time to build a budget. 

- Information since March shows that state revenues are tracking below the trend shown by the March forecast.  State employment is much weaker than the estimate included in the March forecast.  We are anticipating a lower level of unemployment in the May forecast and throughout 2009.

- Preliminary income tax collections are down about $40 million for individual taxpayers.  Our real concern is on the corporate side, where payments have been roughly half of what was projected, and are down about $50 million.

- We think the May forecast will be down.  But we are starting to see some early indications that this economy is bottoming out, in terms of housing, consumer spending and financial markets. 

- In general, our overall scenario is that the recession will end late this year nationally.  Unemployment, though, probably won’t peak until later in 2010, with Oregon reaching 12%.

1:28 p.m.

Some of the key points framed by James Sager:

- When the governor released his budget Dec. 1, it included planning for $1 billion short of essential budget level.  Since that time the state has lost roughly another $2 billion in revenue, and unemployment continues to rise up to 1 percent per month.

- Our concern is a year from now.  After talking with variety of economists, we believe that the bottom is still out there a ways, and when you look at Oregon's history of being late getting in and late getting out (normally at least two quarters) of recessions, it may be early next year before hit bottom.  It's possible the bottom could last a couple of years, and it could be four-to-five years before state revenue reaches historical trends for growth.

- We believe that we could be down another $2 billion in revenue a year from now (the Ways & Means co-chairs estimate $1.4 billion).  We're concerned that the May 15 state revenue forecast may not capture the complete loss, so the legislature could, on paper, approve budgets at a higher rate than we will actually receive.  That will cause the legislature to come back into special sessions.  We're trying to avoid that.

- The additional $2 billion loss would leave schools with $5.422-$5.5 billion, after using all federal stimulus and reserves. That amount would include any SIF funding.

12:59 p.m.

It's standing room only for the meeting today, with superintendents and business managers packing-to-overflowing the 120-person meeting room.  First up will be governor's office representative James Sager.

Wednesday, April 1

To assist superintendents and business managers who are unable to attend, we'll be blogging live from the school funding meeting in Salem Friday.  COSA will be joined by James Sager and Paul Warner for discussion of the revenue forecast and district budgeting for 2009-10.  Here are the materials for the meeting, which begins at 1 p.m. at the Viticulture Center:

Overview of 2009-11 K-12 Funding

2009-10 School District Finance Distribution based on $6.2 and $6.0 billion

2009-10 School District Finance Distribution based on $5.0 and $5.8 billion  

2009-10 School District Finance Distribution based on $5.8 and $5.6 billion  

2009-10 School District Finance Distribution based on $5.6 and $5.4 billion  

2009-10 ESD Finance Distribution based on $6.2 and $6.0 billion

2009-10 ESD Finance Distribution based on $6.0 and $5.8 billion 

2009-10 ESD Finance Distribution based on $5.8 and $5.6 billion 

2009-10 ESD Finance Distribution based on $5.6 and $5.4 billion  

Comments (6)

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Business Manager
written by Donna Cancio, April 03, 2009

Will you be covering the letter from Susan Castillo that mentioned a 30% reduction and a SSF fund of merely 4.99 Billion???

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Superintendent
written by Dennis Dempsey, April 03, 2009

Is there a consensus on what level school districts and ESD's should build their budget for 09-10?

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30%
written by Craig Hawkins, April 03, 2009

James Sager responded to a similar question and said that a 30% reduction for schools would result in Oregon's likely being unable to meet the requirements for receiving federal stimulus dollars. The legislature has asked all state agencies, including ODE but not K-12 schools, to plan for up to a 30% reduction, though.

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consensus
written by Craig Hawkins, April 03, 2009

No consensus on a number, Dennis, but a belief that we should advocate for some number in the higher end of the possible range (6.0+), and then districts should plan for funding at levels lower than that, and communicate impacts of those funding levels in each community.

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HR Director
written by Beau Horn, April 08, 2009

I haven't heard mention of the April 17 date that the joint Ways and Means Committee is set to release their budget (which I assume will include K-12). I know that the May revenue forecast will likely impact any number the committe releases. For planning purposes, especially around staffing, how useful will the 4/17 number be? Will the 4/17 number take into account the expected drop in the May forecast?

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Ways and Means budget
written by Craig Hawkins, April 10, 2009

Beau,

Our understanding is that a complete Ways and Means budget won't be available until after the May 15 forecast, although there may be some pieces released prior to the committee's series of public hearings around the state. All planning now includes an expected drop in the May forecast (if not, we'd be talking about K-12 biennial revenue of $6.1 billion or more), but nobody really know what that will be. At this point, we're suggesting that districts should probably be planning for 2009-10 budgets based on a range of $5.4-$6.0 billion in state revenue.

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