It may have come to the public’s attention only recently, but officials at the Snyder and Ira school districts say they have been working behind the scenes in preparing for the expiration of Additional State Aid for Texas Reduction (ASATR) beginning with the 2017-18 school year.
ASATR was authorized in 2006 to ensure no school district would see a loss of revenue caused by tax rate compression when the legislature mandated that school districts lower their property tax rates. ASATR serves as a bridge to help school districts achieve their target revenue. The amount received each year fluctuates for several reasons, including recapture payments and mineral values.
In 2011, the legislature cut ASATR funding by 7.65 percent and revised the education code to repeal funding beginning with the 2017-18 school year.
Snyder ISD began making cuts in 2011 when ASATR funding was cut.
“To make up for the immediate loss of state aid caused by a poor national and state economy, Snyder ISD made approximately $1.8 million in cuts for the 2011-12 school year while freezing salaries and benefits,” said Deputy Superintendent Dr. Randy Burks. “Reductions were made in many areas, including personnel, capital outlay, supplies, transportation, staff development, textbooks, furniture and equipment and stipends.”
Ira Superintendent Jay Waller said the cut in ASATR did not affect his district at first because it was not receiving as much in funding as it is now. With the drop in mineral values, Ira is projected to receive $980,000 in ASATR funds for the 2016-17, which is the most it has ever received.
Waller said the school district would have to cut 19 of 21 teaching positions if ASATR is not renewed, by the legislature before the 2017-18 school year.
Today, the district has a fund balance of $2.4 million and Waller said if ASATR is not renewed, the district could draw on those funds for three years before they were depleted.
Over the years, Waller said the district made cuts where it could and any excess revenue was placed in the fund balance for a “rainy day.” The board of trustees voted to use part of its fund balance to pay for the construction of the new school.
Burks said Snyder ISD has been “good stewards of taxpayer dollars” for years.
“Evidence of this is the fact that the district has not increased its maintenance and operation rate in at least the past 15 years,” he said. “Since 2011, Snyder ISD has become more diligent in its efforts to manage operating costs by offering only small salary increases, limiting capital purchases and working to add to its fund balance in case the Texas Legislature did not address the ASATR issue.”
Burks said since 2011, the district has added $12.8 million to its fund balance, but also used a portion of that to help fund the new Snyder Junior High School. Burks said the district could receive as much as $10.5 million in ASATR funds in 2016-17.
Waller has held two meetings with lawmakers to discuss the funding and has agreed to testify at committee hearings in Austin. But he does not want to see Ira go back to the days when it operated on a fund balance of $500,000, which the district had in 2003.
The district’s board of trustees wanted cuts to be made in an attempt to build its fund balance. The district did that by cutting teachers or having them teach outside of their field. Waller said the district went from being exemplary to recognized in accountability, but by 2008 the fund balance was more than $1 million.
“We found out that when we were broke, something would suffer,” he said. “We were able to put money in the bank and restaff and improved our accountability.”
Waller said he does not have the answer, but thinks the state should continue to fund school districts through ASATR. He said the administration will prepare two budgets, one that includes ASATR funding and one without, hoping he would be able to operate with the budget that includes the funding.
“I don’t want to do a Plan B budget,” he said.
Burks said Snyder ISD is looking at several options to reduce operating costs next year and beyond. That started with cutting the pre-kindergarten program to a half-day for a savings of $200,000.
“Other reductions in personnel have been made by absorbing some positions. Personnel costs make up approximately 76 percent of the budget,” he said. “In addition to personnel reductions, supply, travel, operations, athletic, transportation and other budgets are being reduced. These cuts are necessary so that the district can operate more efficiently in the interim if the legislature delays in addressing this issue.”
Ira has made cuts in several areas, including not buying new uniforms for athletic teams and limiting meals for out-of-town trips. Waller said those cuts might be small, but they add up.
One thing that will be included in both district budgets will be an interest and sinking fund tax rate to pay off bonds that were used to finance construction of the Ira ISD school and Snyder Junior High School. Even without ASATR funds, voters in both district approved bonds to pay for the construction and must carry that burden until they are paid off.
Officials at both school districts are waiting for a court ruling on school finance and lawmakers to get direction on how to fund public schools.
Both Burks and Waller have June 2017 marked on their calendars.
“It is likely that nothing will be done until the next regular session, which runs from January through June of 2017. June of 2017 is certainly the 11th hour in terms of the funding cliff that is imminent in September 2017,” Burks said.
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