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Committee approves school district budget

Budget heads to the board for adoption next month


by: SUBMITTED GRAPHIC: LAKE OSWEGO SCHOOL DISTRICT - In the coming year, Lake Oswego School Board members will assess the results of a real estate study to determine which elementary schools to keep or sell, eventually bringing in millions of dollars with a property sale.  The board approved closing three of the nine elementary schools - Palisades, Bryant and Uplands - to help bridge a budget gap in the past couple of years - and the schools could reopen, depending on the boards decision after reviewing the real estate study.  The budget committee discussed the potential impact of selling a school building on the school districts budget.Administrators say the 2014-15 proposed $64 million general fund budget that the legal budget committee approved last week “represents a turning point” for the Lake Oswego School District.

What’s new is that the proposed budget, which goes before the school board for a public hearing June 2, does not have a negative balance for the first time since 2011-12: $225,000 without needing to tap into the cash reserves. The district also is able to forgo a $1 million planned cut because of an increase in state funding, which will allow more elementary school employees to be hired and help the district maintain its target teacher-student ratios.

Next year’s fiscal budget also “represents the first budget since 2008-09 where the district is able to not only propose a balanced budget that maintains all current programs and current target ratios, but also allows for targeted reinvestment in certain areas, primarily at the elementary level,” according to the budget message by Superintendent Bill Korach and Executive Director of Finance Stuart Ketzler. “While the district has been able to make targeted investments over the last several years, such as the resumption of the seven-day period at the junior high schools or the phased implementation of the elementary Spanish immersion program, those investments occurred simultaneously with reductions in staffing or programs in other areas.”

State funding increased with additions including $100 million more in additional K-12 funding that state legislators approved in November 2012. Plus, the state updated demographic information on poverty, English as a second language, special education and general enrollment, which also gave LOSD a funding boost. State standard revenues — a state formula allocated based on enrollment that establishes the dollars districts receive — jumped from $49.1 in 2012-13 to $53.4 in 2013-14 to $55.4 million projected for next year.

Having a larger pot to draw from would allow district officials to hire more staff at elementary schools, like reading and math specialists, counselors and physical education teachers. To address budget gaps, the district also instituted three furlough days for teachers and four for administrators, and that practice is scheduled to continue next year.

Some staffing also could be reduced, depending on enrollment, which currently is budgeted for the same as this year, 6,846, because more solid figures will not be available until Oct. 1. That’s well beyond when the board is slated to vote on whether to adopt the budget on June 9, and when it will be effective, July 1. There were about 100 more students enrolled this year than in 2012-13.

“Our secondary schools are currently projected to have slightly lower enrollment next year than this, and we staff to (student to teacher) target ratios,” Ketzler said. “If the number of students at the secondary schools goes down, then staffing is correspondingly reduced to better hit the target ratios.”

The budget document also addressed other issues, such as the planned Lakeridge stadium project and a real estate study. The only funding mentioned as a potential option that could finance the $2.2 million controversial stadium project was a construction excise tax revenue, a fee for developers totaling about $1 million. Next year, the project also could be supported through revenue from a construction bond currently under discussion.

“It is important to note the proposed funding mechanism of a construction bond is not indicative of specific plans or an actual proposal to seek a bond,” Ketzler said.

The idea is to set up the ability to fund a stadium if the school board chooses to pursue the project by putting it in the budget.

“The school board will revisit this project late this fall or early winter to determine if there are new developments or new information that allows the project to move forward or whether it will continue on hold for further evaluation,” Ketzler said.

In the coming year, school board members will assess the results of a real estate study to determine which elementary schools to keep or sell, eventually bringing in millions of dollars with a property sale.

Ketzler said the board could sell a school building within the next school year, but it’s an involved process, “possible, but not easy.” Public input likely would be involved, and once the board chooses which schools to sell, the sales process could require re-zoning the property.

The board approved closing three of the nine elementary schools — Palisades, Bryant and Uplands — to help bridge a budget gap in the past couple of years — and the schools could reopen, depending on the board’s decision after closely reviewing the real estate study.

The real estate study revealed maintenance required at local elementary and junior high schools, totaling about $24 million, all of which could be paid for with revenue from a construction bond.

“There is no specific proposal for a (general obligation) bond at this time, only a strategic planning priority that targets a GO bond for either May or November 2015,” Ketzler said. “I believe this will be a significant discussion during this July’s strategic planning and priority-setting that will take place in mid-July this summer.”

Through a general obligation bond, a state or local government issues bonds and pays off its debt through tax revenues or other resources, usually asking voters to approve a property tax.
By Jillian Daley
Reporter
503-636-1281, ext. 109
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