Indianapolis Public Schools taps savings to pay for big changes

PHOTO: Alan Petersime

For the second year in a row, Indianapolis Public Schools expects to pay next year’s bills by dipping into savings.

With a recent drop in state aid and expensive start-up costs for new programs that will decentralize administration, the district’s budget for next year shows that administrators plan to spend more than they expect to take in, but district leaders say the deficit spending will pay off in the long run.

Weston Young, the district’s chief financial manager said it makes sense for the district to use reserves to launch programs such as the autonomy pilot and innovation network schools. District leaders expect those initiatives to increase district enrollment, which is tied to state aid. The spending also will help improve efficiency with steps such as automating payroll, he said.

“This is a year of investment,” Young said.

The state’s largest school district is running a deficit of more than $12.6 million this year, and it projects a $5.5 million deficit next year, according to a budget estimate presented to the school board by Young. For now, the district can afford to rely on savings because it has about $63 million in cash reserves — funds it typically rolls over from one year to the next. But with each year of deficit spending, it digs a bit deeper into that stockpile.

Depending on how the district is spending funds, it could make sense to run a deficit, said Michael Huber, CEO of the Indianapolis Chamber of Commerce.

“The key is, if enrollments are declining in a given window of time, are they also making tough financial decisions to keep pace?” Huber said.

Just two years ago, IPS was in an apparent financial crisis, facing a purported $30 million budget deficit and the prospect of dramatic cuts. When Superintendent Ferebee took over leadership, however, a new accounting revealed that the district actually had a surplus. It’s been on relatively solid financial footing since, although it has seen state support decrease due to funding cuts and enrollment declines.

About $5 million of next year’s budget will go toward an investment fund designed to help the district implement its strategic plans, including launching autonomy and innovation network schools. But the district also has mounting costs in other areas. Recent teacher raises included in the latest contract, for example, will cost about $4.3 million this year, and the district is paying the entire cost out of reserves.

The district, which educates nearly 10,000 fewer students than it did a decade ago, is supplementing its budget by selling off underused buildings, including schools and other facilities. It expects to make about $6 million off property sales next year.

Selling off property may seem like an option of last resort for the district, but there may be strategic benefits even if IPS doesn’t need the cash immediately, said Mark Fisher, who handles government relations and policy for the Chamber.

During the IPS budget crisis, the Chamber produced an analysis of district spending that made several recommendations, including calling for it to sell or repurpose underused school property.

“Sometimes they just don’t need that amount of space anymore,” Fisher said. “The space is inefficient.”

The budget challenges are exacerbated by cuts in state funding. Last year, Indiana lawmakers shifted money away from high-poverty urban districts to growing, suburban school districts with higher-income students. Between last year and this, the state cut the district’s aid by about $200 per student, according to calculations from the Center for Evaluation and Education Policy.

Funding for IPS will increase again next year, but the district is still expected to lose out on close to $17 million in state aid over two years if statehouse enrollment projections prove accurate. But Ferebee is betting that lawmakers will reverse course by increasing funding.

“At some point the state … has to invest more in public education,” Ferebee said. “There’s no way that I think our legislators would expect us to continue to operate public education at the same level of funding.”

What's Your Education Story?

As the 2018 school year begins, join us for storytelling from Indianapolis educators

PHOTO: Dylan Peers McCoy/Chalkbeat
Sarah TeKolste, right, and Lori Jenkins at a Teacher Story Slam, in April.

In partnership with Teachers Lounge Indy, Chalkbeat is hosting another teacher story slam this fall featuring educators from across the city.

Over the past couple of years, Chalkbeat has brought readers personal stories from teachers and students through the events. Some of our favorites touched on how a teacher won the trust of her most skeptical student, why another teacher decided to come out to his students, and one educator’s call to ramp up the number of students pursuing a college education.

The event, 5:30 p.m. Thursday, Sept. 13, is free and open to the public — please RSVP here.

Event details:

5:30 p.m. to 7:30 p.m.
Thursday, Sept. 13, 2018
Tube Factory artspace
1125 Cruft St., Indianapolis, IN 46203
Get tickets here and find more on Facebook

More in What's Your Education Story?

School safety

Hiring more security officers in Memphis after school shootings could have unintended consequences

PHOTO: Jahi Chikwendiu/The Washington Post/Getty Images

Tennessee’s largest district, Shelby County Schools, is slated to add more school resource officers under the proposed budget for next school year.

Superintendent Dorsey Hopson earmarked $2 million to hire 30 school resource officers in addition to the 98 already in some of its 150-plus schools. The school board is scheduled to vote on the budget Tuesday.

But an increase in law enforcement officers could have unintended consequences.

A new state law that bans local governments from refusing to cooperate with federal immigration officials could put school resource officers in an awkward position.

Tennessee Education Commissioner Candice McQueen recently reminded school personnel they are not obligated to release student information regarding immigration status. School resource officers employed by police or sheriff’s departments, however, do not answer to school districts. Shelby County Schools is still reviewing the law, but school board members have previously gone on the record emphasizing their commitment to protecting undocumented students.

“Right now we are just trying to get a better understanding of the law and the impact that it may have,” said Natalia Powers, a district spokeswoman.

Also, incidents of excessive force and racial bias toward black students have cropped up in recent years. Two white Memphis officers were fired in 2013 after hitting a black student and wrestling her to the ground because she was “yelling and cussing” on school grounds. And mothers of four elementary school students recently filed a lawsuit against a Murfreesboro officer who arrested them at school in 2016 for failing to break up a fight that occurred off-campus.

Just how common those incidents are in Memphis is unclear. In response to Chalkbeat’s query for the number and type of complaints in the last two school years, Shelby County Schools said it “does not have any documents responsive to this request.”

Currently, 38 school resource officers are sheriff’s deputies, and the rest are security officers hired by Shelby County Schools. The officers respond and work to prevent criminal activity in all high schools and middle schools, Hopson said. The 30 additional officers would augment staffing at some schools and for the first time, branch out to some elementary schools. Hopson said those decisions will be based on crime rates in surrounding neighborhoods and school incidents.

Hopson’s initial recommendation for more school resource officers was in response to the school shooting in Parkland, Florida, that killed 17 people and sparked a wave of student activism on school safety, including in Memphis.

Gov. Bill Haslam’s recent $30 million budget boost would allow school districts across Tennessee to hire more law enforcement officers or improve building security. Measures to arm some teachers with guns or outlaw certain types of guns have fallen flat.

For more on the role and history of school resource officers in Tennessee, read our five things to know.

Sheriff’s deputies and district security officers meet weekly, said Capt. Dallas Lavergne of the Shelby County Sheriff’s Office. When the Memphis Police Department pulled their officers out of school buildings following the merger of city and county school systems, the county Sheriff’s Office replaced them with deputies.

All deputy recruits go through school resource officer training, and those who are assigned to schools get additional annual training. In a 2013 review of police academies across the nation, Tennessee was cited as the only state that had specific training for officers deployed to schools.