Be Informed! Financial Accountability and the Garretson School District

Much has been written lately in the Argus Leader and the Garretson Gazette regarding the school’s position and decisions made by the School Finance Accountability Board.  Normally, these stories include a very bold statement in the headline and details that follow only tell part of the story.

In 2016, the legislature made significant changes to the funding formula for schools.  A half-penny sales tax was enacted to pay for this increase and a portion of the tax was intended for property tax relief.  In the end, the original bill was modified to include two different models for accountability for spending the money on instructional staff.  One model included a requirement to raise teacher compensation by a certain percentage and the second required that a certain dollar amount be spent on salary and benefits for instructional staff.  Both the percentage increase and the total dollar amount was based on enrollment projections from the Dept. of Education, which were based on the previous year’s student enrollment.

That year, our board went into staff negotiations with a clear picture of what needed to be done, and at the end of those negotiations, and planned to meet both accountabilities by spending over $3,000 more than was required and increasing instructional staff compensation by one full percentage point more than was required by the law.  After negotiations, the situation changed.

At that point, we knew that we would not have as many students as the DOE projected.  Knowing that the real increases in “new” money would not match up with projected increases in funding, the Board very thoughtfully considered opportunities that could be used to ensure that our budget stayed balanced.  The law included a provision by which schools could apply for a waiver to the accountability rules for certain conditions.  The impact of declining enrollment and the financial impact of retirements were two circumstances included in the list of factors that the Accountability Board would be required, by law, to consider for a waiver.

In the spring of 2016, opportunities presented themselves as a way that District could ensure that our budget remained balanced.  First, Two teachers retired and were then replaced by first year teachers. Second, the District was able to create a shared Spanish teaching position with the Baltic School District. The Board very carefully considered whether it was appropriate to take advantage of these opportunities to maintain a balanced budget, and ultimately decided that they would put their faith in the Accountability Board to recognize those factors that are outlined in SD law as significant and worthy of consideration for a waiver to the accountability rules.

On November 16th, Board President Shannon Nordstrom and I attended the Accountability Board meeting in Pierre to tell our District’s story and ask them to consider a waiver.  At that meeting, members of the Accountability Board made it clear that they would not consider the impact of declining enrollment or the impact of teacher retirement, even though these were both clearly laid out in the law as factors for consideration in order to recommend a waiver to the rules.  In our District, the impact of declining enrollment was over $48,000 and the impact of teacher retirement was over $35,000.  Ultimately, the Accountability Board decided to recommend to the Appropriators a “conditional waiver,” which would require the District to spend an additional $62,000 on instructional staff salaries.

The process does not end with the Accountability Board.  That Board made a recommendation of this conditional waiver to the Joint Committee on Appropriations, which is made up of SD legislators.  That group will make the final decision, and we are hopeful that they will look at the provisions of the law and consider all of the factors that are laid out in it.  We ask for your patience as we learn more about what, if anything, we are required to do.  After we know the specifics, our School Board will consider our options, weigh out what they believe to be in the best interest of our District, and we will make adjustments where necessary to ensure that we are able to provide the best programming that is possible for our students and our community.

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