School 94501/94502

During the course of the debate over Measure H, it has struck me that a significant number of people who should know better still don’t understand the fundamentals of how AUSD’s finances work and how essential to our kids and our community Measure H really is.

The most important “missing piece” in many discussions around here about AUSD’s finances is the recognition that AUSD has very little control over its revenues. The overwhelming majority of AUSD revenues come from the state. So when the state economy is in a recession and the state budget is in free fall — as happened for 08-09 and as will happen again for the 09-10 budget cycle — AUSD’s revenues will drop precipitously. Even though “the district” and “the Board” have the responsibility of dealing with the resulting budget crisis, the situation is not of their making.

Furthermore, unlike a business that can balance its books by closing divisions and operations, AUSD may not cut costs by, for example, shutting down its highly unprofitable “special ed division” or suspending any of its other services for high needs (and therefore more expensive) students. AUSD must educate all students wishing to enroll in public schools in Alameda.

Accordingly, AUSD is largely at the mercy of a state system that cuts its revenues at the same time that it mandates much of its expenses.

Moreover, since AUSD already has cut so much out of its budget in recent years and now has such relatively lean administration and low staff compensation/benefits relative to surrounding districts, there just isn’t a whole lot that can be done to make up large budget gaps by reducing the costs of existing operations, particularly in the short term. Although there are surely some modest additional cost-cutting and efficiencies to be gained within AUSD, no one who has looked seriously at AUSD’s budget can conclude there is way to come anywhere close to finding the millions in dollars in cost savings that would be necessary to “cut our way out” of the financial troubles we face.

As a result, the only short-term defense we have against the pathologies and instability of the of the state’s school finance system is to generate additional revenue locally. And it is important to remind ourselves that that is exactly what Alamedans voted to do in June by a margin of more than two to one in passing Measure H by 66.9% to 33.1%: We voted to step up locally with a short term parcel tax to offset dangerous cuts to our funding by the state.

The continued deterioration of the economy and of the state budget in recent months demonstrates the wisdom and necessity of passing Measure H in the first place and of defending it vigorously now. AUSD is facing unprecedented financial peril in the coming months. If we were to lose Measure H now, that loss would deal a tragic, mortal blow to public education in Alameda that would devastate our kids and community in many, many ways.

In recent weeks and months, we’ve heard quite a bit from anti-H people about the burdens that will be borne by those who will begin paying Measure H taxes this month. Of course paying any new taxes is a burden, especially in a weak economy. But in thinking about the merits of Measure H, that burden has to be balanced against the alternative of what we all would face without H: real, long term, possibly irreversible damage to public education in Alameda.

If AUSD does have to make millions more in cuts soon, there isn’t much mystery about what will be on the list. Among other things, we’ll see school closures, the end of K-3 class size reduction and 9th grade class size reduction, significant layoffs of teachers and staff, and cuts or elimination of funding for athletics, music, AP classes, counselors and college and career services.

Given all this, I have to agree with the perspective of AUSD’s attorney Page Barnes when she explained her motivation to fight the anti-H litigation in Friday’s Alameda Journal: “I am fighting to preserve the educational quality of 10,000 students and uphold the will of an overwhelming majority of voters who recognize the importance of passing this parcel tax for our kids.”

To understand the degree to which the fate of AUSD hangs in the balance, it is helpful to take a look at the budget numbers driving the existential financial challenges facing AUSD in the coming months.

The state budget is in such dire straights that the Governor has called a Special Session of the legislature to enact additional budget cuts for the CURRENT SCHOOL YEAR (”mid-year cuts”). Among the “highlights” of the Governor’s proposal to cut 2.5 billion more from the education budget for this school year – yes, those would be cuts for the year for which school districts were required to approve a budget last June — are (1) retroactively eliminating the COLA for 08-09 and (2) retroactively reducing revenue limit funding (i.e., general funding) by 1.79 billion. Even more ominously, this draconian Special Session plan only addresses 11 billion of the state’s projected shortfall. The Governor projects another 13 billion deficit for 09-10. That means that in January we will hear about even more cuts ON TOP OF THESE for the next, fast-approaching budget cycle. If the legislature is unable or unwilling to act in the Special Session (which I think is likely), the whole problem of a 24 billion deficit would be carried into 09-10.

The following numbers aren’t precise, but they are “in the ballpark” and so are useful for getting a general sense of the financial horrors AUSD will be facing soon as a result of the combination of (1) the state cuts already made in 08-09, (2) the 2.5 billion in additional cuts proposed in the Special Session FOR THE CURRENT 08-09 SCHOOL YEAR and (3) the additional cuts that will surely have to come for 09-10 (with a 13 billion dollar deficit coming in 09-10, those cuts are likely to be in the range of 2 to 2.5 billion more).

So it looks like AUSD will have something close to either (1) 2.5ish million in new mid year cuts from Nov-Dec for 08-09 from the state AND the 2ish million from Aug-Dec = 4.5ish million total for 08-09 AND then we’ll have new cuts of 2 to 2.5 million for 09-10 (AND another 1 mil or so from the impact of Nea if it is approved) OR (2) nothing will happen at the Special Session in Nov-Dec so that in January, on top of the 2ish million that we were cut in Aug-Sep 08-09, we’ll get whacked massively by 5ish million for 09-10 (AND another 1 mil or so from the impact of Nea if it is approved).

Regardless of whether more cuts are made in the Special Session or are delayed until 09-10, based on what the Governor is proposing we will be looking at something close 7 million in cuts or more for all of 08-09 and 09-10 combined (AND another 1 million or more due to the opening of Nea if it is approved).

Even under a “best-case scenario” in which the Governor’s proposed cuts are halved, it looks like AUSD would then “only” get cut by 5ish million for the two year 08-10 budget cycles by the combination of (a) 2 mil in regular 08-09 cuts and “only” 3 million more in combined cuts from (b) special session 08-09 cuts (if any) and (c) regular cuts for 09-10.

Having these numbers in my mind is one reason that many of us who support Measure H are so very displeased with and determined to fight the anti-H litigation. Even with all of the 4.2 to 4.5 million annually that Measure H provides, public education in Alameda may still face brutal cuts and just barely survive financially, even under the “best case scenario.”

Without Measure H, I don’t see how we will avoid turning into the Oakland of several years ago, going out of business, getting taken over by the state and losing the local community voice we still have in how our schools are run.

Defend Measure H!