**UPDATE: For every Regional Budget Meeting, including tonight’s (May 9) meeting at Inman Middle School at 6 p.m., Atlanta Public Schools will have the district’s Finance Team and a Human Resources representative available to address all questions and concerns regarding the tentative FY20 budget and compensation.**Creating a FY2020 Budget that Puts Students First, Rewards Hard-working Employees

As recently as my last blog about National Teacher Appreciation Week, I mentioned how much I enjoy this time of year as we celebrate our beloved educators and our beautiful students – soon-to-be Class of 2019 graduates in particular. And I do, but this also proves to be among the most challenging parts of the year because it is also Budget Season!

Every budget cycle offers its share of puzzles and headaches, but this one has been somewhat daunting. Money expected from an intergovernmental agreement with the City of Atlanta has not been paid, while tax forecasts from the county have been delayed. Such obstacles and delays make it difficult for our financial team and the Atlanta Board of Education to develop a sound and responsible budget for the fiscal year ahead.

But we are getting there.

The Board approved a tentative FY2020 budget for the district with a 7-1 vote on Monday, May 6. It represents months of work, although there is still another month of work until the Board’s final approval on June 3. And it includes teacher and staff pay raises but not at the level approved by the General Assembly and the Governor earlier this year.

Let me explain.

Although the Board tentatively approved a $851 million General Fund Budget, it came short in funding all of the raises because we continue to wait on the $10 million IGA settlement payment from the City of Atlanta due back in January 2019. We are hopeful that this agreement will be honored by the City so that we can have confidence that we will receive the recurring $12 million from the Eastside TAD in next year’s budget and future budgets.

We also continue to wait for digest information from the Fulton County Tax Assessors, so the budget is based on a conservative growth estimate of 4%.

For further background, the state-suggested pay raises are not fully funded. While we appreciate the attention paid to low teacher pay in public education, the FY2020 state budget did not provide funding to school districts equivalent to the $3,000 per teacher pay raises.

First of all, we employ more teachers (and other crucial wrap-around staff) than is funded through the state QBE funding formula, and raises for all these employees must be 100% paid for from local funds. Also, the state funding formula is reduced for all districts by something called the “local fair share” or “local five-mill share.” Because of large increases in this state hold-back, we only expect about $8.9 million of new funding from the state. The compensation package we would need in order to meet the state’s recommendation would be $18.5 million.

Since January, we had planned on offsetting the lack of state funding for these raises through recurring funds promised in our TAD intergovernmental agreement or IGA as negotiated with the City of Atlanta. However, because another $10 million one-time payment that was also negotiated with the city and due in January was never paid, we are hesitant to pass on the full amount of the raises until this revenue funding source is more secure.

That gives a picture of how the revenues stack up, but we’ve still been able to do quite a bit in this budget even with restricted new revenue. 

This budget includes:

• $12 million in salary raises for all employees and keeps in alignment our pay scales and initiatives as set forth in the pay parity plan from 2015.
• Raises for employees on the teacher pay scale equal an average of $2,000 (3.3%) per teacher and include a $1,000 one-time payment for eligible employees who are off-step. The district is receiving $8.9 million in state funding for teacher pay raises, and the proposed teacher raises cost $9 million, therefore passing on the entire amount received from the state.
• Non-teacher pay raises, which include a step and a 1% increase for pay grades 111-124 (total 2.45%), a step only for pay grades 125-140 (total 1.2%), and a $700 one-time payment for eligible employees who are off-step. 
• Pay parity adjustments that include increasing school resource officer holidays equivalent to other employees, adjusting the JROTC instructor work schedule and supporting some position reclassifications.

While this is not everything we wanted to do, we intend to provide the full package of pay raises if we are able to secure the additional revenue in the coming months and would pay that retroactively to the start of the school year if we need to.

In this budget, we continue to meet our obligations for pension and rising TRS costs. More money than ever has been pushed directly to schools, through Student Success Funding (SSF), including an additional $2.5 million for textbooks. This year, $420 million of the budget goes directly into traditional school budgets. On top of that, $135 million is dedicated to charter schools and $44 million to partner schools.

This shows a concerted effort of this Board and the District in making sure that schools, GO teams, and principals are the ones with more control over their school allocations making decisions in the best interest of students. 

Once flowthrough dollars – funding spent centrally directly on school efforts – is taken into account, the central departments account for less than 10% of this tentative budget, meaning more funding spent directly on students.

Between now and the final adoption, we will hopefully have final revenue projections with the sending of property notices, and we will have more accurate forecasts for the charter and partner budget once the FY2020 QBE sheets have been released by the state. 

We will address any of these adjustments that we can at the May 16 budget commission meeting.

The public has more opportunities ahead to learn and speak about the budget. The Board has scheduled another public hearing for the FY2020 budget at 6 p.m. Monday, June 3, here at the Alonzo A. Crim Center for Learning and Leadership. The District will also host four community meetings (all at 6 p.m.):

• Thursday, May 9 at Inman Middle School
• Monday, May 13 at Benteen Elementary School
• Thursday, May 16 at E. Rivers Elementary School
• Monday, May 20 at B.E.S.T. Academy

All of the budget work helps us keep focused on our mission and our No. 1 core value of putting students and schools first. I am encouraged by the work so far and look forward to the weeks ahead as we finish building the strongest budget possible for our students and schools.

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