Budget BasicsPreparing for the 2011 NC General

Assembly Session

Situation Analysis

• NC budget shortfall of $2-$3.7 billion for the 2011-12 fiscal year.

• Cause: end of federal stabilization funds; end of some state taxes; end of nonrecurring cuts.

• Economic recovery continues to be slow.

Situation Analysis

• Public school budgets have been cut for three consecutive years.

• Yet, with approximately 37 percent of the state’s overall budget tied up in public schools, it’s tough to reach spending cut targets without impact to public schools.

Basic Facts

• State funds total approximately $7.2 billion of public school funding or about 65 percent of the money schools spend to operateeach year.

• Local funds = 25 percent;Federal funds = 10 percent.

Funding Sources

• 84% of state funds go towards personnel costs (positions).

• Local funds go towards operating costs and capital outlay (maintenance employees, fuel, hospitalization, facilities, furniture, etc. – not intended to fund teaching positions).

• Federal funds are very restricted to specific purposes – Title 1, EC, Grants.

Trend over Time

How NC Ranks

North Carolina ranks 45th inthe nation in per-pupil spending.

Common Questions

• Why are schools always on the chopping block?

NC’s Public School Fund is the largest chunk of the state budget’s General Fund.

Common Questions

• What about the lottery funds –won’t they help?

Lottery funds do help – but they make up only about 3.9 percent of the budget. And, they’re designated for specific purposes –K-3 teachers, More at Four, school construction and scholarships.

PCS received $2,245,677 used for construction

Common Questions

• Can’t we just cut administration and leave teachers alone?

Eliminating all administration (NCDPI, central office staff, principals/assistant principals) would total $478 million –less than half of the possible $1 billionin targeted cuts. In addition, none of the workload has been eliminated.

Common Questions

• Why not cut out testing? Wouldn’t that save a lot of money?

Cutting out all testing would save about$11 million - far short of our needed cuts. Also, NC is required to do some testing under federal and state laws.

Common Questions

• What about Education Jobs Bill Money?

1.2 million will be helpful but will not close our budget shortfall.

Common Questions

• Won’t the federal Race to the Top funds help solve our budget problem?

Race to the Top is providing nearly $400 million over four years to North Carolina - but the funds are targeted for specific purposes and not for general use. Funds are a one-time allocation.

Race to the Top

• Pender County Schools Race to the Top allocation is $669,000 spread over the next four years.

• Earmarked for technology infrastructure, professional development, and implementation of the new common core standards.

Where We Are

Just as NC schools are showing significant progress, our budget shortfall presents a significant gap.

State Budget Impact on PCS – 5% Cut

• 24 Teacher Positions (out of 385/excludes math and science)

• 5 Instructional Support Positions (media and counselors)• 1.5 Assistant Principal Positions• 2 CTE Teacher Positions• 43 Teacher Assistant Positions • 1 Director Position Central Office (8%) • No funded allotment for office support,

custodians, and substitute teachers (2.1 million)

State Budget Impact on PCS – 10% Cut

• 29 Teacher Positions (out of 385/excludes math and science)

• 5 Instructional Support Positions (media and counselors)• 2 Assistant Principal Positions• 3 CTE Teacher Positions• 67 Teacher Assistant Positions • 1 Director Position Central Office (8%)• No allotment for office support, custodians, and

substitute teachers (2.1 million)

Allotment Comparisons 2008/09 - 2011/12

2008-09 $39,118,603

2009-10 $38,922,026

2010-11 $36,855,178

2011-12 (5% cut) *$30,456,291

2011-12 (10% cut) *$29,151,003

*Includes LEA Adjustment of $1,390,634

Enrollment Comparisons

2008 – 09 8194

2009 – 10 8112

2010 – 11 8241

2011 – 12 ?

Governor’s Budget

• Represents an 8.57% reduction for public schools

• Transfers additional costs to local (county) government so in reality represents a higher cut. County governments would take on the cost of school buses, worker’s comp and tort claims.

• Lottery funds to schools cut by 30%

Governor’s Budget

• Continuation Adjustments – does not account for growth• Recommended Adjustments:

Central Office reduced 10%

Instructional Support reduced 5%

Non-instructional Support reduced 15%

Transportation reduced 13.4%

Dept. of Public Instruction reduced 10.2%

More at Four reduced 5%

ADM Adjustment 1.4 million for PCS

Other Challenges

• Will we be able to keep Low Wealth funding?

• How will we pay office support, custodians, and substitutes with no funding?

• Additional costs to local government?• Will we lose employee supplements and

no-pay athletics?• Rising costs in fuel and employee benefits.

Senate Bill 8

• Eliminates cap on charter schools.

• All funds going through an LEA current expense fund must be shared with charter schools including fund balance.

DPI Budget Information

http://www.ncpublicschools.org/budget/financial/

Contact Legislators!

• Carolyn.Justice@ncleg.net

• Bill.Rabon@ncleg.net