Facing the likelihood that the coronavirus will impact the Palo Alto school district's budget for several years, members of the Board of Education on Tuesday urged taking a conservative, "aggressive" approach to budget cuts to stave off deep deficits.
The district is facing a $3 million shortfall this year as a result of both lost revenue and increased spending related to school closures and the pandemic. The "moderate" budget forecast presented by staff projects deficit spending over the next three years if the district doesn't make cuts.
How much revenue the district will have in the coming years remains uncertain, with the renewal of a parcel tax, property tax revenue and facility rentals (including the city's lease of Cubberley Community Center) up in the air due to the virus. The state is facing a $54 billion deficit, though as a community-funded district Palo Alto Unified is less reliant on state funding. The district also is eyeing large, long-awaited investments in special education and dyslexia over the next three years.
School board members said Tuesday they support using the district's reserves to address the shortfall.
"It's not a question of being willing to dip into reserves," said school board member Ken Dauber. "We have to if we're not going to make choices that are pretty catastrophic.
"It's for a rainy day," he said of the reserves. "It's clearly raining."
Staff presented two plans for cuts to the 2020-21 budget on Tuesday. One would save $3.7 million by cutting four administrators, 13 certificated staff and seven classified staff as well as contracted services and summer school offerings. The second plan proposes an additional $2 million in cuts if necessary, primarily in classified staff positions. District leadership put forward reductions that wouldn't negatively impact class sizes or course offerings, Superintendent Don Austin said.
While the publicly posted plans didn't mention any specific positions that would be eliminated, a proposal to restructure the district's instructional leaders positions -- including for visual and performing arts, physical education and career technical education -- was sent to teachers prior to the meeting, sparking concern.
Well over a dozen teachers, parents and students called into the virtual board meeting to speak out against the restructuring (which has been in the works for over a year, Austin said in an interview after the meeting). They argued that the visual and performing arts instructional leaders are particularly crucial to the health of arts education in the district.
One board member, Melissa Baten Caswell, agreed and said she would trade off increasing class sizes to preserve the visual and performing arts (VAPA) instructional leaders' positions.
"These programs that bring together everybody from the worst performing student academically to the best performing student in the same room, working together on a choir performance — it's the great equalizer," she said. "But I don't know if we can have that same impact if we don't have some sort of leadership fulcrum there, and right now that's our instructional lead for the VAPA program."
Austin responded that the arts program is "heavily, heavily resourced," with department leaders, team teaching and full-time teachers on special assignment in addition to the instructional leaders.
Dauber and board President Todd Collins urged a bigger-picture mindset when it comes to budget cuts.
"We're not posing a fundamental threat to the quality of our arts or other programs," Dauber said. "We are not going to get through this if we scrutinize decisions that make a lot of sense. I think we need to enable staff to make these judgments without exhaustive board review."
The school district has lost an estimated $1.7 million out of its $256 million total budget during the school closures, according to a staff report. With all of its campuses shut down, the district has lost revenue from school lunches and facilities that would usually bring in rent from outside groups who use them for summer camps and after-school programs.
Meanwhile, adjusting operations to the coronavirus has cost the district about $1 million, including developing distance learning, providing resources for remote working conditions, purchasing $16,000 worth of hand sanitizer and paying salaries for workers who are considered essential.
Staff is recommending the district create a $500,000 contingency fund to address emergency COVID-19 expenditures in the 2020-21 school year, such as purchasing masks for staff and students.
Board members also briefly discussed the potential impact of cuts the city of Palo Alto could make to services that students and families use, as well as the possibility of the city pulling out of its lease at Cubberley Community Center. The district owns 27 acres at Cubberley and leases them to the city, which in turn rents the facilities to various nonprofits, studios and sports groups. The city owns the remaining 8 acres of the widely used community center at 4000 Middlefield Road.
In response to a question from Baten Caswell, Austin said he doesn't think the district will be in a position where it's no longer receiving any rental revenue from the $5 million city lease, and that a reduction to about $2.5 million to $3 million is more likely.
The board will discuss the budget again in early June and is set to adopt it on June 23.
Find comprehensive coverage on the Midpeninsula's response to the new coronavirus by Palo Alto Online, the Mountain View Voice and the Almanac here.