UPDATES from NWRESD Superintenden James Sager to staff
503-614-1401

February 8, 2012

There are two issues that arose today: 1) the Revenue forecast; 2) SB 1540.

1) The revenue forecast came in as close to flat as I have seen in several years.  The reduction in General Fund and Lottery was $35m.  While this is still real money, as part of a $13 billion budget it is fairly minor.  Assuming the legislature does not do something crazy over the next couple weeks, the forecast should mean we are flat funded for next year and our grants (not accounting for any enrollment change) will be down about 3.5%.  So we will need to absorb the revenue reduction and any increased costs as we prepare next year's budget.  This is all good news considering the challenging times.  The second piece of the forecast is looking out to the next biennia, 2013-2015.  The forecast projects an increase in state revenue of approximately $2 billion or 9%.  Again, this may seem like a lot until you look back at the transition from the 2009-11 biennia to the current 2011-13 biennia.  At that time education needed a 13% increase, public safety needed about 23% and human services required a 48% increase to maintain the then current services.  The three areas account for 93% of the entire state general fund budget.  So we can anticipate a further squeezing of resources. 

2) SB 1540 is a catchall or omnibus bill regarding education.  When introduced it included language that would bar ESDs from establishing contracts with private entities and providing services to districts outside our region.  We brought forward to the Senate Education Committee on Monday all the problems with this language and late today they passed the bill out of committee after removing this language.  So it appears for now we will be able to continue to provide service to private schools and other partners as well as expand our joint efforts with other ESDs to provide services across boundaries.

As we are today, we need to all work together to continue to find ways to provide the best level of service possible at the best cost for our students and districts.  I will send out further updates as information becomes available.

Thanks for all you do.

James

January 20, 2012

The even year legislative session will begin February 1.  On February 8 we will receive the next state revenue forecast.  These two events are very important and I want you tom aware of the issues and possible impact to NWRESD and our local districts.

From a policy perspective, the most important legislation we know of to date comes from the Governor’s new Oregon Education Investment Board.  While we have not seen the actual draft legislation, we believe it will call for every district, ESD, community college and university to sign an achievement student compact by June 30 of each year tied to funding.  There are several compact examples being floated about but no decision has been made regarding the actual forms and/or requirements.  There may also be legislation regarding “Early Learning” while it appears this could have an immediate impact on several of our partners it may not impact our current EI/ECSE grant program (at least for one more year).  There does not appear to be any active bills designed to eliminate or significantly change ESDs.

On the budget, there are two major pieces in the state budget funding for NWRESD, 1) State School Fund, where we receive a portion that we split 90/10, 10% for ESD operations and 90% out to districts in services and funding; 2) Grant in Aid programs through the Oregon Dept. of Ed.  These are our EI/ECSE grant; Autism/Regional program grants and others.

The legislature has tried to protect the State School fund (SSF) up to this point but if the February forecast shows an additional revenue reduction of $100 million or more, then legislative leaders have said they do not believe they will be able to continue to protect the SSF.  And throughout the entire process our grant funds have been and remain in jeopardy.  My best estimate of risk is 10%. 

With the looming risk to funding and known increased costs for next year, I have instructed all programs to develop a budget based on a 10% reduction.  This is just a starting point and we will review and analyze a long list of possible options.

I will keep you up to date as information develops. 

James

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