Balancing Our Budget and Funding Our Priorities

A note from the superintendent,
Dear Oakland Unified Community:Over the past two years, we have made improvements and faced our budget challenges head on. This year, we started our budget development process earlier than ever to strengthen our prioritization process and communication with our schools and community. I am writing with an update on our budget, our need to reimagine how we use our resources, and what to expect in the coming months in terms of communication.We have known, and have shared widely, that our expenses are growing faster than our revenue. Overall, we –and all California school districts–do not get enough state money to meet our students’ needs. Whenever we discuss our budget, we cannot forget that fact.In preparation, last June the Board passed a resolution acknowledging the need to reallocate tens of millions of dollars over the next two years to balance our budget.At the December 11 Board Meeting we will hear the first interim budget report which will tell us how much we will need to change our current spending in the coming years. The first interim budget report will update the multi-year projection based on the latest budget information. OUSD must continue to improve how we use our resources. For this year, there are two reasons you will be seeing some significant changes to our budget: (1) state funding is not keeping up with expenses; and (2) we are not getting the academic results we need for our students.
1. State funding is not keeping up with expenses: All school districts in California are under this same pressure. State funding is not keeping up with increasing basic expenses such as special education, employee retirement, and increased employee compensation.Special Education: Oakland is facing similar increases as districts across the state and we anticipate additional increases next year. Over the last five years, OUSD’s contribution to Special Education has increased from $34.2 million to ~$50.8 million (projected).Employee Retirement: There have been steep increases in mandatory contributions over the last several years. In 2013-14, California school districts contributed 8.25% of teacher salaries to the CalSTRS pension fund. In 2021, school districts will pay 19.1% of teacher salaries into the system. In fact, the Legislative Analyst Office predicts that any increased revenue for next year will basically only pay for increased retirement costs (see here) and the little that is left over should be considered one-time funding because of a predicted recession.Increasing Employee Compensation: First, this is a top priority. We need to have competitive salaries to attract and keep great educators. Our employees are the foundation on which our students will achieve. Other school districts with recently settled new contracts like Los Angeles and West Contra Costa to name a few, are in a similar situation (see memo). This is not a crisis. When we signed agreements with OEA and SEIU, we knew we would have to re-prioritize our spending and that further adjustments would be needed to settle agreements with other employee groups (i.e. UAOS, AFSCME, Teamsters, CSEA, and BTC).
While we know there are statewide efforts underway to increase funding to K-12 schools, we cannot build a budget on potential new revenue.2. Improving Student Achievement: Every year we should be looking closely at our academic spending and making changes to improve student outcomes. We are not getting the results that we want for our students. To improve outcomes, in addition to increasing compensation, we are refocusing our efforts on reducing chronic absence, increasing literacy, and increasing our A-G graduation rates.Over the coming weeks and months, we will use email, social media, and presentations to provide updates about timelines, answer questions as they arise, and address topics such as:The scope of changes necessary for the coming years;Updates on our multi-year projections and what they mean;How we currently spend our resources; andNext steps and ways to engage with Board members and how to give feedback.
I welcome the opportunity to have important conversations in the coming months. I know some of these will be challenging, but I am confident that we can continue to face issues head on and move forward together.
Please share your thoughtsRespectfully,
 Dr. Kyla Johnson-Trammell
What do you think?

More Comments