Commissioners Question “Where does this end?”
“Too Many People At Central Office?
Johnston County Public Schools Interim Superintendent Dr. Jim Causby appeared before Johnston County Commissioners on Monday formally requesting $8,874,429 to meet a shortfall in the current 2019-2020 fiscal year budget. Dr. Causby was joined by School Board Chairman Mike Wooten who was in the audience.
In November, Causby informed the school board they would likely run out of money in April unless additional funds were obtained from the County or numerous layoffs took place. Causby said former Superintendent Dr. Ross Renfrow, who retired in August, had already cut $2.87 million from the budget in the first two months of the fiscal year. Causby said after he was hired as interim-superintendent he trimmed an additional $7,048,203 from the budget.
Commissioners approved $67,945,918 in funding for the school system this fiscal year, but Dr. Causby says they need at minimum $76,820,347. The difference is the $8,874,429 funding request.
“In my 30-some years of being a superintendent I have never gone back to a board of commissioners during the year and asked for more money. We’re now in a very unusual circumstance,” Dr. Causby said. “When I began to look at the budget after I got here, there had been some attempts to make budget reductions. Those reductions cover $2.8 million. Most of those were Central Office kind of things. Since I have been here we have identified more than $7 million of additional reductions in the local budget. Our budget is made up of federal, state and local dollars. We know what the state money is going to be, and the federal. The additional needs that are left are then local requests.”
“There have been a number of things that have happened. One is that there have been expenditures for programs, and some folks will say those were good or those were bad. I can’t second guess where they were or not, but these are programs over the years that have continued to increase. For example teacher salary supplements. That was funded out of fund balance and comes out every year and it continues to grow,” Dr. Causby told Commissioners.
$10 Million Fund Balance Depleted In 2 Years
“Two years ago the school system had almost $10 million in fund balance. That is now down to 800-and-some thousand dollars, that was spent over the last 2 years to balance the local budget, even with additional money that you gave that was spent. Again, I can’t argue whether it was wrong or right, or whatever, it’s a fact. It was spent. Of that 800-and-some thousand that is still in the fund balance, only 300-and-some thousand is usable. The other is what’s called restricted. It is money that is being held for situations like the Spiking Bill for Dr. Croom and another employee or two in the system. So that is held and it’s there. We can’t touch that. So we only have 300-and-some thousand actual fund balance we can actually touch.”
“Last year you had appropriations of $64 million and a fund balance of $5.9 million was spent. So a total of $69.9 million was spent last year. For this year, the local (budget expense) was $76,820,347, so that’s an increase of $6.8 million. Why did that increase? I’ve listed the reasons why. Financial software required by the state to purchase and put in place, increased workers comp insurance, charter school payments for additional charter school students, property insurance, utility costs – Duke Power has gotten a 12.5% increase the last two years and they’re requesting that again. Salaries and benefits that’s outlined in the budget the legislature passed, that has not happened yet. If nothing happens this will be less. If the Governor’s proposal is passed, this would increase. His request is a lot more than this. And then our exceptional children’s program has been a big issue with us and we’re having to spend more funds,” Causby said.
Exceptional Children’s Program
“Exceptional children’s programs are required by federal law and state law. When the federal government initially said they would require this, they said they would fund 40 percent of the cost. They have never funded more than 20. The rest of it is left to the state and locals. Our state funds a maximum of 12.75 percent of our K-12 operation… if you’re under that, they fund you on the actual number… We have right at 17 percent of our population identified as Exception Children Program. That difference can only come from a couple of places. It can come from wherever we can find it, out of state money or it can come from locally. Our actual total cost is about $9.4 million for that program. About 5 (million) of that we’re funding out of other state programs – low wealth funds, at-risk funds, funds that we really should be using for decreasing class size, paying supplements, those kind of things. The rest of it has been covered out of local. That’s where the local fund balance expenditure was used to cover that. The federal funds, which also had fund balances, those also have been spent to do the same thing.”
Causby continued, “This is a very attractive County for the Exceptional Children Program and always has been. When I was Superintendent here before, folks when they were moving to the Triangle with new jobs, they school shop. And they would move to where they think the program is they are going to need. In Exceptional Children, your program is as good as any in America. And you’re getting a lot of folks who are school shopping and coming to this system.”
The school leader then answered questions and heard comments from several commissioners.
Vice Chairman Chad Stewart said, “It seems like the state is setting the rules and we’re setting the funding.”
“It’s just like the salary increases. They set them and you have to give them. It’s your only choice,” Causby said.
Chairman Ted Godwin added, “We need a Chevy instead of a Cadillac.”
“Where does this end?”
Commissioner Larry Wood had some of the toughest questions for Dr. Causby. “From what I understand we’re mandated to build schools. I don’t remember the number but we’ve got 200 to 300 county employees working in the schools. We’re supplementing the salaries. We’re doing so much more than what we’re mandated and I think we have a good school system and I want to do all that we can for the school system, but I just wonder where it ends.
Referencing a Clayton resident who was questioned the school budget shortfall during the public comments section of the commission meeting, and was encouraged to take his concerns to the next Board of Education meeting, Wood said, “We told the gentlemen before he was knocking at the wrong door asking about the school system. I feel like kinda’ you’re at the wrong door. I just can’t get over the fact that we’re so far beyond what we’re charged to do. All it does is grow government. All it does is grow taxes. All is does is pressure hardworking people into paying things that is way beyond what we’re ever charged with. I just don’t understand that.”
“I’m a small government guy. Where does this end? How much money have we got to pay to solve the problem we’ve been throwing money at since I’ve been on this board? It seems like it’s getting worse,” Wood said.
Dr. Causby replied, “I wish I had a definitive answer for you but I don’t. I understand your frustration with it. I’ve been in this business a long time and funding schools is very very frustrating especially for the two local boards. Because by law you’re required to fund schools. It doesn’t specify how much, or for what, but you have no real control over money after its allocated. The school board has the responsibility of providing the programs, the very best programs they can for students, but they have no authority to raise any funds. It causes a clash every year across the state. Both boards are trying to fulfill their responsibilities.”
Vice Chairman Stewart said, “We appreciate you coming in. Obviously you didn’t have to do this. This isn’t a beat up Dr. Causby session but you can see there’s a lot of frustration out there with the social media and the news reports and stories and I’m feeding off his (Commissioner Wood’s) frustration and trying to clear some of this stuff up. I’m trying to find answers.”
“Our boards have always worked together good and we’re going to continue to,” Stewart continued. “But you know you set a budget and you’re suppose to work within that budget. It’s frustrating… we feel like our hands are tied. It feels like there is no purpose in a budget. You guys just spend what you want to, and we’re going to keep our schools open, and we’re going to pay our teachers, and that’s no question. But it throws our financial model way out of whack. We’re not blaming anybody but how do we tighten this thing up? I’m sure like you said we’re working diligently on. I hope you’ve got next year’s budget under control before you decide to leave us.”
Too Many People At Central Office?
Chairman Ted Godwin then stated, “The white elephant in the room that everybody thinks about and talks about, is that we go to the local hangout, or wherever it is, and it’s the thing that we’re confronted with more than anything else, and it’s what people talk about. ‘We’ve got too many people at the Central Office.’ There. There I said it. It’s out in the open.”
Dr. Causby responded, “I’ve heard that every place I’ve ever been. I don’t know whether we do or not but I know we have reduced a significant number through these processes and will continue to look at everything that comes open before I okay hiring. I’m not going to not hire teachers and not hire certain things that we need. But if there’s other positions that we can do without we’re not going to fill ’em. It’s going to take some time. All I can tell you is what I found, and where we are, and to tell you we need help.”
“Is there an answer other than you not giving us help. Yes there is. It’s not pleasant,” Causby said. “I will have to begin action, a reduction in force program which will affect the schools. So far we’ve not touched out in the schools.”
“I don’t think anybody, you know we don’t want that, but the Central Office takes a lot of hits because of reports its top heavy over the years, salary increases… I hope that’s getting close attention,” Commissioner Stewart said. “I want it to work but at what cost to the taxpayer do we have to do what we’re doing now?”
Commissioners took no action on Dr. Causby’s $8.87 million spending request.