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Pinellas, Hillsborough school districts face drastically different budget issues

On one side of Tampa Bay, one of the state's largest school districts is talking cuts, cuts, cuts. It has 400 jobs on the chopping block. Its employees may be forced to take unpaid leave. Its young teachers aren't sure if they'll be working in the fall.

On the other side of the bay, another big district is just snipping. Its finances are in such good shape that an ongoing effort to lease copy machines is one of the bigger steps it's taking to balance next year's budget.

"We're not anywhere near layoffs," said Hillsborough superintendent MaryEllen Elia.

As Florida school districts make their deepest spending cuts in decades, Pinellas is using an ax; Hillsborough, a scalpel.

Demographics, planning and labor relations are among the reasons why. For proof, look no further than the huge reserves Hillsborough racked up in recent years.

By 2008, the district, with the teachers union nodding in agreement, had set aside enough money from surging state spending and student growth to build a $338 million reserve fund, far more than any other big district in Florida. As education cuts intensified, Hillsborough had a cushion.

Pinellas, by contrast, has been saddled with a double-whammy. Bigger cuts. Higher costs.

Even as they faced significant enrollment declines, administrators had to wrangle with teacher salaries that are higher than neighboring districts; health insurance benefits that are more generous; administrative fat that has been thick by comparison; and school staffing models that even union officials concede were not cut fast enough to keep pace with shrinking student numbers.

Reserves? Minimal. And in the face of cuts, the teachers union has asked to tap them even more.

"I can't see how their labor organizations would let them get away with that," Fred Matz, Pinellas' chief financial officer, said of Hillsborough's reserves. "If we had something like that, the labor unions naturally would be expecting us to spend it on raises."

Marshall Ogletree, the executive director of the Pinellas teachers unions, makes no apologies.

"We're going to negotiate over available funds," he said.

He also said Hillsborough has played into the hands of state lawmakers by making it look as if districts have adequate funding when education spending in Florida ranks near the bottom nationally.

"I personally believe they (Hills­borough) should have spent more in the other areas to put pressure on the Legislature," Ogletree said.

• • •

Pinellas is staring down a $53 million to $60 million budget hole. Hillsborough, nearly twice as large, needs to cut $28 million.

To be sure, it's tough to compare one district's plight to another. Even neighboring districts can have wildly different needs and resources.

Hillsborough is enjoying a seven-year, $100 million grant from the Bill & Melinda Gates Foundation to reform teacher evaluations and pay. It gets about $9 million a year in state merit pay money that most school districts (including Pinellas) rejected. Pinellas, meanwhile, reels in more than $30 million a year from a voter-approved property tax hike.

It's also true that financially speaking, it's Hillsborough — not Pinellas — that is the exception to the rule.

This week, the Duval County School Board (projected cuts: $91 million) tentatively okayed the elimination of 163 district-level jobs, while the Broward County School Board (projected cuts: $142 million) began considering the closure of a dozen schools.

In Pasco (projected cuts: $54 million), district officials said 513 positions may be cut. In Hernando (projected cuts: $18 million), there's no talk of layoffs, but not much in reserves either.

Plenty of districts probably wish they were in Hillsborough's shoes.

"If I had a $300 million reserve, you're darned right you wouldn't be seeing what you're seeing right now," said Pinellas superintendent Julie Janssen, who was hired in fall 2008. "I came in (to the job) with … mediocre reserves. I inherited what I inherited."

• • •

In Hillsborough, officials started worrying about reserves long before the recession hit. They literally began planning for a rainy day.

Elia said Hurricane Charley in 2004 was a wakeup call. Early forecasts had the storm barreling up Tampa Bay.

"That was a scary time for us," said Elia, head of facilities at the time. "We had between 30 and 40 schools that were going to be heavily affected and damaged."

In 2005, officials began to talk about what seemed a far-off goal: paying employees for a month if Tampa was under water, then getting schools running again quickly.

One month's payroll is about $100 million for Hillsborough. But the district only had $50.6 million in its unreserved fund balance in 2004, around 4.8 percent of its operating budget. Pinellas had $50.8 million, or 7.5 percent.

Within four years, Hillsborough had upped its reserves to $338 million, or 22.8 percent of its operating budget, while Pinellas lost ground, slipping to $35 million, or 5 percent. (By last spring, Pinellas had climbed back to 7.7 percent, while Hillsborough had fallen to 20.1 percent.)

So what happened? Enrollment was one factor. While Pinellas was losing 10,400 state-funded students, Hillsborough was gaining 7,800.

Hillsborough also pushed itself early in preparing for the class-size amendment passed by voters in 2002. It kept a close watch on staffing. It redrew school boundaries to spread students evenly.

By 2005 the district had more state class-size money than it needed and used the balance for teacher salaries, which were low compared with other large Florida districts. It gave teachers a 5 percent raise that year, 10 percent more in 2006 and roughly 9 percent more in 2007.

Those raises helped mollify the union just as the district began significantly cutting costs to sock away money.

Hillsborough officials lengthened the teaching day by 20 minutes. They added a period to middle and high school schedules. They cut bus routes and slashed administrative positions. Some specials like elementary art were cut to a single, 30-minute class per week.

The result: By 2010, the district had slashed $100 million.

Union officials did challenge the district over reserves versus raises. But by 2007, said Hillsborough teachers union president Jean Clements, everyone was worried about a new problem: an economic crash.

"I remember talking then with MaryEllen about not being certain what the future was going to hold," she said. "We were ripe for the (housing) bust. The district became very cautious."

It was that fear that persuaded the union to back off its push for raises in 2008. Teachers took a 2 percent increase that year, nothing in 2009, and 2 percent again last year.

The union "didn't want to force the district into having to do layoffs and having families without income," Clements said.

• • •

Pinellas has cut and cut, too. Proportionally, it has cut more.

In 2008, it moved middle schools to a seven-period day. In 2009, it closed six schools and consolidated four more. Over the past five years, it has reduced its operating budget by $118 million, while Hillsborough has cut $127 million.

But Pinellas also has higher costs:

• Teacher pay. Despite little or no raises in recent years, the average salary in Pinellas last year — $45,851 — was still $116 higher than Hillsborough's.

• Benefits. The average percentage of total health insurance premiums contributed by employees for family coverage last year was 23 percent in Pinellas. It was 49 percent in Hillsborough.

• Administration. As recently as 2009, Pinellas was at or near the top among the state's 12 biggest districts when it came to the percentage spent on central administration. But cuts have made the district leaner. Recent figures showed Pinellas administrative costs are now less than most big districts.

District and union officials also say many Pinellas schools have been overstaffed given the decline in student numbers. The number of "instructional units" rose from 7,356 in 2004 to a peak of 8,516 in 2007. It's down to 8,119 now.

"We have staffing that we probably don't need," Ogletree said. "In good times, we put that in."

In bad times, it has made a tough situation tougher.

"Maybe we should have planned better for a rainy day," said School Board member Linda Lerner. "But we've had a lot of rainy days in a row."

Unlike Hillsborough, Pinellas has reached into the federal bailout money it received last fall. The $23-million was supposed to be set aside in reserves, to soften the blow for next year. But unexpected gaps grew this year, including costs for 120 more teachers than projected.

The union is outraged about the dwindling reserves. It wants a "full accounting" of where the money went.

Times staff writer Tony Marrero contributed to this report. Ron Matus can be reached at matus@sptimes.com or (727) 893-8873. Tom Marshall can be reached at tmarshall@sptimes.com or (813) 226-3400.

A tale of two school systems

Pinellas and Hillsborough face different budget issues.

PinellasHillsborough
Average

teacher pay
$45,851$45,735
Student

enrollment
Down from a peak of 113,112 in 2004 to 102,672 last fallUp from 184,377 in 2004 to 192,154 last fall
Budget gap

for next year
$53 million to

$60 million (out of

an operating budget of $891 million)
About $28 million (out of an

operating budget

of $1.7 billion)

Sources: Florida Department of Education, Pinellas, Hillsborough school districts

Pinellas, Hillsborough school districts face drastically different budget issues 05/12/11 [Last modified: Friday, May 13, 2011 12:14am]
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