PORT ANGELES — The Port Angeles School District will face a number of significant fiscal challenges over the next few years related to a drop in enrollment, inadequate state support and an end to the state’s education stimulus program that will necessitate a 10 percent reduction in spending, Superintendent Marty Brewer said.
Decisions about what cuts will be made will be undertaken next year.
Brewer gave a 30-minute presentation to the PASD board during its last regularly scheduled meeting of 2022. The next school board meeting will be at 6 p.m. Jan. 12.
Brewer and business and operations director Kira Acker delivered a financial picture to the board that contained little good news, but with a commitment to create a plan for cutting costs so the district to meet its 2023-2024 budget.
“As we all know in this room, we have some work ahead of us,” Brewer said.
Two simultaneous factors — the decline in the district’s enrollment and the end of the Elementary and Secondary School Emergency Relief (ESSER) program — have hit the district particularly hard. (ESSER is part of the American Rescue Plan and provides funding to schools to aid in their recovery from the COVID-19 pandemic. It is scheduled to end next year.)
“Our enrollment has not 100 percent come back the way we’d like it to happen,” said Acker of the district’s post-COVID numbers.
“Our average headcount in ‘19-‘20 was 3,637 and our average in ‘21-‘22 was 3,463, so there’s 174 kids across the district who haven’t come back.”
Even though the number of students has fallen, Brewer said, the district had maintained the same level of staffing and services, and in some areas increased services, over the past three years.
It was only able to do this because ESSER funds covered the gap between falling revenue due to declining enrollment and its expenditures.
In 2020-21, the district used $2,668,663 in ESSER funds to offset the difference between its revenues and expenses; $8,119,934 in ESSER funds in 2021-22; and $5,684,971 in ESSER funds for the current 2022-23 school year. According to OSPI, the district’s total ESSER allotment was $17,031,054.
Having balanced its budget the last three years using ESSER funds, the district now has to find a way to balance it without them.
There were only two ways to do this, Brewer said.
“Either you increase revenue or you decrease expenditures, and to increase revenue to a district, really, that comes in one form: increased enrollment, but I don’t see that happening this year,” Brewer said.
Because the district’s enrollment revenue can’t match the $5,684,971 in ESSER funding that enabled it to balance this year’s $60,602,088 budget, it will have to decrease spending by about that same amount — $5.6 million or around 10 percent — to meet next year’s.
“We’ve gone through many reductions and costs over the course of a couple of decades,” Brewer said. “But I believe that this one could be the largest reduction we’ve seen in recent times.”
Among the solutions to the district’s financial situation, Brewer said, was looking to Olympia for “Legislative fixes to problems that we have experienced in our system that are not only a problem for Port Angeles, but a problem across the state of Washington.”
Among these, Brewer said, was pushing the Legislature to fully fund special education.
Although the district’s overall enrollment is falling, it is seeing a rise in the number of special education students, Brewer said.
Because state and federal dollars do not completely cover the cost of special education, districts like Port Angeles must dip into their educational programs and operations (EP&O) levies, whose funds are supposed to be dedicated to enhancement programs and services such as music and athletics.
“We spend all of our state SPED (special education) money, all of our federal SPED money and nearly $2 million of our EP&O to meet the basic needs of our special ed population,” Brewer said.
That the state should fund special education at the same level it supported basic education, Brewer said, was “the morally right thing to do and it’s the law.”
Another fix that could only happen at the state level, Brewer said, was revising the regionalization model the Legislature uses to fund school employee salaries and which Brewer said had created a system of “haves and have nots,” with Port Angeles being among the latter.
When salary and benefits comprised about 84 percent of the district’s expenses, Brewer said, it was essential that a solution be found.
The good news, he said, was an OSPI working group will present recommendations for changes to the funding model to the Legislature during its upcoming 2023 session.
Brewer nevertheless called the state’s funding model “broken,” because of what the inequities he said it created between districts.
“We’re looking at cuts like this district have never seen before,” Brewer said. “We need the Legislature to step up and do what’s right this year.”
Among other items at the meeting:
• The board approved a draft of the strategic plan presented by Brewer and Ann Renker. The draft drew from feedback from focus groups drawn from more than 1,000 people who responded to a community wide survey last spring about public education in Port Angeles, they said.
• The Board elected Sarah Methner as its new president and outgoing president Sandy Long as vice president. Katie Marks was elected to a two-year term as the board’s legislative representative, Long was elected for a one-year term as its Washington Interscholastic Activities Association representative, and Jacob Wright and Long were elected to the audit committee.
• Franklin Elementary principal Jeff Lunt presented sixth graders Mei Deng and Gabriel Rader with the district’s students-of-the-month awards.
To view Brewer and Acker’s 2022-2024 financial presentation to the bard, go to: tinyurl.com/vt9s75hm.
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Reporter Paula Hunt can be reached at Paula.Hunt@soundpublishing.com