Anticipated school budget shortfall grows to $38 million

Tuesday, January 26, 2010 at 11:41pm

Metro Nashville Public Schools is now facing a projected $38 million budget shortfall for the 2010-2011 fiscal year, an increase from the $35 million school officials had forecast two weeks ago.

An obligation to pay higher employee insurance rates than originally projected has added another $1.2 million to shortfall projections, while accommodations for an additional 300 charter school students next year is expected to cost the district another $2.6 million. Those figures weren’t at the district’s disposal when administrators evaluated the budget outlook earlier this month.

“We are still very early in the process,” said Chris Henson, the district’s chief financial officer. “We’re still in January, so things will continue to change as more information is made known.”

While Steve Glover, who chairs the school board’s Budget and Finance Committee, has warned his colleagues to “be prepared for drastic reductions if no new funding is identified,” Director of Schools Jesse Register has vowed to avoid eliminating in-class teaching positions.

The district’s budget dilemma comes as sales tax revenue for the current budget is $7.5 million short of projections. With the updated $1.2 million bump revealed Tuesday, the district now has to account for a $7.2 million increase in employee insurance costs. In addition, the district must fork out an additional $12.4 million in pension funds.

Meanwhile, the original shortfall projection hadn’t figured in the district’s newest charter school — New Vision Academy — and other charter schools that are set expand, requiring MNPS to account financially for a student population more broadly dispersed.

“Not enough (charter) students are coming out of schools in the different grade levels to warrant a decrease in the number of teaching positions,” Henson said. “So, the district is left with the same costs that it had before.”

Making matters worse, another $12.4 million in reserve funds used during last year’s budget crisis will come out of this year’s budget.

Historically, the district has tapped into its undesignated reserve funds — set aside as rainy day funds dollars — during budget shortfalls. But Tennessee state law requires all districts to keep reserves above 3 percent of their budgets. The MNPS reserve funds have gotten so low that using them is off limits.

The school board is scheduled to go before the Metro Council’s Budget and Finance Committee Thursday, Feb. 18.

19 Comments on this post:

By: NotDaveCooley on 1/27/10 at 1:51

Well it's a good thing we'll have a shiny new convention center to make this all better.

By: govskeptic on 1/27/10 at 5:30

What's new with this info.? Paid health ins and other benefits
received by both Educational and other government employees
that are much higher than most private sector employees is
going to continue to skyrocket. Of course, this is never brought
out when discussing how underpaid all are. We can always sell
off taxpayer purchased assets: Fairgrounds, parking meters,
abandoned schools(replaced by shiny-expensive new ones),
old conventions center (at about 1/2 it's value) , Maybe Goldman
Sachs will purchase the Gateway Bridge and make it a toll bridge.
All sorts of solutions for this "Sticky" little problem. Maybe just
feeling a little skeptical this morning!

By: martindkennedy on 1/27/10 at 6:17

Not enough students are leaving conventional schools to go to charter schools? Well that is set to change as well as more charters are approved. As more students leave conventional schools teacher levels can be adjusted. If the focus is on per pupil funding then this problem should take care of itself - a school's funding is driven by enrollment. You get the teacher positions that your enrollment dictates.

By: michael thomas on 1/27/10 at 6:45

Well now the 38 million that it was is now 40.7 million for being irresponsible and taking care of business. Send in the next case please!

By: house_of_pain on 1/27/10 at 7:57

How much is being used for the pre-K babysitting service?

By: AmyLiorate on 1/27/10 at 8:22

Another case of p**s poor planning.

I like to be an optimist and think that we all learn from mistakes and improve ourselves, but government agencies rarely seem to do that.

Surprises, unavailable data, overruns, never enough money and not much accountability. Is it just my pessimism rising up or should we ever expect much to change?

By: idgaf on 1/27/10 at 8:56

Sales tax revenue will continue to fall as more and more people lose their jobs.

You are right pain pre-K should be the first to go, especially since more and more parents are home because they lost their jobs.

It was/is another entitlement that we really couldn't afford that is non productive but once they start them they can't get rid of them. That is/was "their" plain to insure re-election of their party.

By: localboy on 1/27/10 at 9:04

"That is/was "their" plain to insure re-election of their party."
Those tricky Republicans-fooled you again!

By: NewYorker1 on 1/27/10 at 9:16

If the schools got the $38 million, I still don't think it would be enough. They would still ask for more.

By: nashtnman on 1/27/10 at 9:59

yea let’s build a 635M convention center when we can't even afford to educate our children. Smart move stupid-ass council. Has everyone learned how to vote yet??????

By: BigPapa on 1/27/10 at 10:02

"If the schools got the $38 million, I still don't think it would be enough. They would still ask for more"
I think you are wrong. If the schools got $138 million, I still dont think it would be enough. They would still ask for more.

By: NewYorker1 on 1/27/10 at 10:30

That's true BigDaddy.

By: idgaf on 1/27/10 at 10:31

Indoctranation is expensive these days.

Teaching the basics is the cheap way to go.

By: NewYorker1 on 1/27/10 at 10:37

We seem to forget the basic foundation to education and that is what the parents do at home. I don't care how much money we pump into the schools, but if the parents are not doing what they need to be doing at home, then it doesn't matter how much money we give to the schools. Education starts at home. The schools are doing too much as it is. They need to get back to the basics and stop raping the tax payers and start holding the parents more accountable for their children's education.

By: JeffF on 1/27/10 at 10:47

"Not enough (charter) students are coming out of schools in the different grade levels to warrant a decrease in the number of teaching positions,” Henson said. “So, the district is left with the same costs that it had before.”

Surprisingly enough the MNPS does not mention that the primary reason for the slow attendance is their own foot dragging while trying to prevent the charter school system from gaining a foothold. How convenient is it that they can blame charter schools for not taking the load off the system while they try to prevent students from leaving the failing schools they control.

By: NewYorker1 on 1/27/10 at 10:51

You guys better be glad I'm not governor, because I would cut all that extra crap out of the school budget and only provide the basics. If you want your child to eat lunch or be in extracurricular activities, then you pay for it. If you can't afford to provide your child these needs, then perhaps you need to stop having children because you can't afford it.

By: govskeptic on 1/27/10 at 11:08

JeffF: You are right on the money with that statement. Mr. Henson should
be asked to explain his answer fully as to not enough students in
the charter schools. Additional if he knew of anything other than hindrances
that created this so called problem. It doesn't matter the administrator
they have a DNA for excuses.

By: sidneyames on 1/27/10 at 1:29

And let's don't forget to include the million dollar settlements for law suits and the like.

New Yorker said "If you want your child to eat lunch or be in extracurricular activities, then you pay for it. If you can't afford to provide your child these needs, then perhaps you need to stop having children because you can't afford it."

I agree NY1, but most of these people screaming the loudest don't have a clue about budgeting, parenting or running a school system. The school system is one great big tax payer funded baby sitter!

By: NewYorker1 on 1/27/10 at 2:01

Well said sidneyames. You are so right about that.