Four Sets of Questions: Highline School Budget Set for Approval on June 17, 2024

-Original publish date 6/16/24-

The Highline School Board is set to approve the 2024-25 school district budget at a board meeting on Monday, June 17, 2024 (usually meetings are on Wednesdays, but Juneteenth is on Wednesday June 19 is a holiday). The operations budget is $397 million, at a forecasted average cost per student of more than $24,000.

After hearing the budget presentation, and later reading the slides and the budget book, there are several questions and items I suggest the board consider.

The board does not have to approve the budget on June 17, there’s still time to redo the budget if they wish.

Four Questions:

First, Highline test scores have in general been very low for many years. Covid resulted in even lower test scores, and the scores have not recovered or even returned to the pre Covid low results, as reported for the most recent test score data available. So, is this budget going to help improve academic outcomes, especially literacy?  

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‍Second, Highline’s enrollment has dropped 8.1% since the 2018-19 school year. This is nearly as much as the drop of 8.5% in Seattle, with major budget impacts on Seattle that have been in the news recently. Highline’s enrollment is forecast to continue dropping for the next four years, which is the full length of the forecast period.

‍So, is it prudent fiscal management to plan on running four years of deficits, running down reserves to just 3% of the budget in reserves at the end of four years? “Hope” (that the state will increase funding) is not a strategy. What happens when the reserves are at 3%?

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‍Third, was there sufficient citizen input during the budget planning process to create confidence for voters, who will be asked to approve an operations levy in 2025, and who will likely be asked for hundreds of millions more to pay for rebuilding more schools?

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‍Fourth, has the school board had sufficient discussion and vetting of the budget to be fully confident they understand it in detail? Is it appropriate to just approve the budget on the content agenda and not have a board discussion? Why was this placed in the Consent Agenda for June 17, 2024 meeting?

Public Comment Period at June 17 Meeting:

The June 17 board meeting is at 6 pm at the school district headquarters, 156th and Ambaum. Citizen comment is through signups ahead of time, click here for more information about signing up to comment.

Background Information about the Budget:

On June 5, district Chief Financial Officer Jackie Bryan presented the budget in a work study session to the school board in a Powerpoint presentation. There was then a hearing afterwards, and then a regular board meeting with a first hearing, as recounted in this story. There were four budgets presented:

1. Capital projects (funding new buildings at Evergreen and Tyee HS, plus some other expenditures)
2. ASB (Associated Student Body) fund, where student moneys are managed for yearbooks, activities and other items
3. Transportation (buses)
4. Operations

June 5 Presentation Highlights:

Here are highlights from the presentation on June 5 and from the school district budget book about the operations fund:

• The school district central office staff had extensive discussions with school district employees about the budget.  As noted on slide 5 of the presentation, there were discussions with the Family Action Committee, the Superintendent Student Leadership Team, and community partners.  The first two groups are made up of individuals who apply and are selected for membership.
  • Not mentioned  on the slide deck: the March 6 school board work study session. Note that at work study sessions, attendees can observe but there’s no citizen comment time. The slide deck from that meeting has numbers very similar to the final numbers.
• Revenue for 2024-25: at $397,929,013, the budget is built on a revenue increase of $7.1 million from the current year budgeted revenue of $390 million. This is an increase of 1.8%
• Expenditures: at $404,641,275, the budget forecasts spending $18.9 million more than the current year’s $385,709,612
  • This means a forecasted deficit of $6.7 million
  • The final budget was cut $8 million from the preliminary budget. The district web site news release of Feb 29 has some info about the impact of the cuts, which are mostly focused on central office staff and services.  
• The district forecasts deficit spending in the next three years as well: $8 million, $8.4 million, then $6.6 million in the 2025-26,2026-27 and 2027-28 school years respectively, for a total over four years of spending roughly $29.7 million more than receipts.
  • At the end of the 27-28 school year, the remaining reserve funds would be just above the board policy goal of 3%, or $18 million.  
  • Currently, the $48 million of reserves are 7% of the district budget.
  • Presenters mentioned plans to go to the legislature for more funding, citing one figure (Basic Education Allowance) but not mentioning other sources of funds the district gets.
  • Presenters also mentioned a goal of keeping cuts away from school-level spending because that is harder to undo if / when funding is more available.
    
    ** AUTHOR CLARIFICATION: Per a district spokesperson, a guiding goal for the cuts was keeping cuts away from schools.
• The local Educational Service District reviews budgets before a school board can approve the budget. The local ESD approved the Highline budget with no comment. Highline was the first district to submit its budget, many others are facing much bigger deficits.

Enrollment drives funding. 71.7%  of the revenue comes from the state, with most directly linked to numbers of enrolled students.

‍As shown on slide 32, enrollment has dropped every year since the 2018-19 school year, when it was 17,829. Enrollment is forecasted to continue dropping for the next four years under both the medium and low projections (high projections are not shown on the graph).

• From 17,829 to the current year 16,615 is a total drop of 6.9%.
• From 17,829 to the forecasted medium level of 16,025 in 2027-28 is a drop of 1,844, or 10.3% of the 2018-19 number. From 17,829 to the low level forecast of 15,463 is a drop of 2,406, or 13.5% .

Why is enrollment dropping?

‍Factors mentioned include a drop in birth rate in King County. But the enrollment drop, and whether it is possible to reverse these trends, was not a topic discussed in the meeting. I hope to write a future story on enrollment.  Also note Seattle is conducting a study, paid for by the state, of their declining enrollment. The findings from that study could be relevant to Highline as well as to Seattle.

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‍The presentation continues with data on state funding. There are several buckets of funds. The state has a “prototypical” funding model, where the state says “for a typical elementary school of 400 some students, here’s what we fund for teachers, classified staff, and more.” If a school has 300 or 500, then the school district makes some adjustments. Local levy money now has a lot of strings attached. Much of the local levy goes to special ed, which is significantly underfunded by the state.

‍Additional slides cover where the money goes (mostly salaries) and funding per student.

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The figures on the slide deck though do not include all sources of revenue. Per Highline communications in response to a follow up email, “... our spending per student (is) based on the Basic Education Allocation (BEA) we get from the state. When OSPI calculates per student spending, they use our total expenditures as the denominator, not just BEA.” In the 2022-23 school year, the spending per student, according to OSPI, was $21,065. This year’s figure will be listed on the web site in the fall, once the budget year is completed.

Two closing comments:

First, the 2024-25 budget book is 69 pages long  with a great deal of information about state funding, board policies and definitions.

There are many data tables – but the information is presented by category of spending, not by activity. And there’s no overview of what the money is actually buying.

• For example, do all middle and high schools have band, orchestra, choir and then other musical opportunities as well, such as the Mariachi bands available at some schools?
• At a recent community meeting, an administrator mentioned Highline has extensive plans to improve literacy (this was in response to a question about what Highline was doing to boost test scores). Well, there’s no mention of this, or any other specific programs and associated costs. For example, how much does Social Emotional Learning (SEL) cost? How much does dual language programming cost? That info is simply not listed in the book.

Second, some information is presented in a confusing manner.

For example, on page 30, there’s an overview of the local levy funding. The data table has a constant figure of $500,000 for an assessed value. This is not realistic. A house assessed at $500,000 in 2018-19 would likely be assessed at $750,000 for 2023, as many houses have gone up in assessed value by 50%. So, the budget book says a property owner in 2018 paid $2,690 in local school taxes. In 2023, at $750K and a rate of $4.09 / thousand, the tax would be $3,067. What’s not mentioned is that the state school fund is an additional $2.518 / thousand, or $1,888. The King County Assessor office does not have 2018, but I found it elsewhere listed as $2.70 / thousand.

So, the state funding, increased in order to pay for the McCleary fix,has gone from $2.70 x $500K to $2.518 * $750K, or from $1,350  to $1,888. Add these together and the total has gone from $4,040 to $4,955. Again, this is for a house assessed at $500K in 2018 and $750K in 2023.

Editorial comment:

Hopefully this information will be helpful at some point. The budget is definitely complicated, and trying to jam substance into the two minutes allowed for citizen comment is very hard. The complexity of the budget and long term considerations is one reason why the June 5 regular meeting board vote of 3-2 vote to put the budget on the consent agenda is particularly disturbing. Items on the consent agenda are passed in one fell swoop, with no board member discussion permitted per board rules. Hopefully we won’t end up in the same fiscal crisis as Seattle and many other districts. Getting a wide range of input, and maintaining reserves, would be two major differences from Seattle’s approach.