Edmonds School District predicts $39M deficit by the end of 2022

By the end of the year 2022, the Edmonds School District is projected to be about $39 million in the red.

That is what a four-year projection shows, according to the district budget presentation given to the Edmonds School Board Aug. 7.

During the Aug. 7 meeting, Stewart Mhyre, executive director of business and operations, made the normal budget presentation for the 2018-2019 school year. Then, for the first time in history, he delivered a four-year projection for the district, which is now required by new state legislation designed to meet the McCleary requirement to fully fund education.

The four-year projection assumes that nothing changes in the district from the 2018-2019 school year — meaning no new staff are hired and no current staff retire or leave. Enrollment is assumed to be flat and no changes in federal funding are accounted for. Levy amounts used in the presentation are based on state projections.Expenditures are projected to rise — which is solely based on current collective bargaining agreements set between the district and unions — and revenue is expected to decline, resulting in a $39 million deficit by the end of calendar year 2022.

Though revenue from the state is expected to increase each year, revenue from local levies is expected to decrease sharply starting in 2019. McCleary legislation requires a cap on funds collected from local levies. That cap must be either $1.50 per $100,000 assessed value, or $25 per student, whichever is lower. The district’s current levy, approved earlier this year, is at $1.50 per $1,000 based on that cap requirement. The former levy was at around $2.35 per $1,000.

“There is still a narrative out there that McCleary fixed it and education is fully funded, and that is absolutely not the case,” Superintendent Kris McDuffy said after the presentation.

Mhyre also identified specific gaps in education funding from the state. For example, the state pays for 25 librarians, but the Edmonds School District employs 33. The state allocates three nurses district-wide, but the district currently has 12. The Edmonds School District has 49 counselors, but the state only funds 39.

In order to make up the funding gap specifically for basic education staff, the Edmonds School District would need an additional $35 million from the state. Special education programs need an additional $5 million.

“This state still, as this really shows, has a number of funding gaps for school districts just to operate efficiently,” Mhyre said.

The Edmonds School District is not the only district facing this problem across the state. Similar stories have recently been told in Seattle, Kittitas and Ellensburg, for example.

“In the next few weeks, more and more districts will be wrapping up their budget and you’ll see more and more of this,” Mhyre said.

–By Natalie Covate

  1. here we go again…
    Does this deficit include the salary increases reported in the earlier MEN article here:
    From today’s article, “Expenditures are projected to rise — which is solely based on current collective bargaining agreements set between the district and unions” would indicate that it does not, since the agreement has not been approved. Therefore the deficit prediction will be higher. Why would they approve higher salaries if it makes the deficit worse?
    Also the article referenced above reported, “The negotiated pay increase is related to additional funding from the state due to the McCleary case.” Very confusing… either the money is there and you increase spending or it’s not there and you don’t increase spending (unless, of course, you can just increase taxes to get it).

  2. The proposed agenda for the Aug 28 special meeting of the school board is posted (some browsers may have a problem with this link since it is non-secure http):

    Item 7 of the miscellaneous consent agenda is “… approve agreement with the Edmonds Education Association (EEA) regarding the 2018-19 salary schedule…” Details for that item have the fiscal impact section blank. In an attempt to get an estimate of the impact, I looked at the proposed 2018-19 budget from the Aug 7 meeting and compared the general fund figures to the proposed budget in this agenda under “Unfinished Business.” It shows an increase of about $4.7M in the general fund. Taken over 5 years (since the above presentation includes the 2022 budget) and ignoring the inevitable increases for inflation, future salary negotiations, etc., that’s over $23 million added to the budget.

    Good “budgeting.”

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