On Wednesday, March 13, Ann Arbor Public Schools Superintendent, Jazz Parks, announced the need to cut $25 million from next year’s budget. Their fund balance, the district’s savings account which is an indicator of financial health, is predicted to drop two percent by the end of this year. Last year, it was at four percent, while five percent is required by the state and 15 percent is suggested by finance experts.
Part of the issue has to do with a $14 million accounting error that was only discovered recently.
“This past November, as part of our regular budget review and audit process, the prior Superintendent made the Board of Education aware of a shortfall in our current school year budget,” Interim Superintendent Jazz Parks said in the March 13 Budget Update.
Another factor that contributed to the budget issue was that money received from the state for the pension fund was mistakenly treated as regular income, which hid the reality of the district’s precarious financial situation, according to the Detroit Free Press.
However, no one or two things caused this crisis— it was the combination of many factors that played into it. Another important factor is the drop in enrollment AAPS has been seeing. When AAPS closed for a year due to the COVID-19 pandemic, the disenrollment rate suddenly increased, as instruction continued to be on Zoom from March 2020 through March 2021. Statistically, student enrollment has decreased by 1,123 over the past four years.
Ann Arbor doctors worked to have AAPS reopen. They explained how in-person education could take place safely through writing to the Board of Education in July 2020, Dec. 2020, and Feb. 2021. They warned about online education taking its toll on students in terms of both education and mental and emotional health, according to the Detroit Free Press. And sure enough, online learning was an absolute disaster for many families, the hardest hit being students of color and those in poverty or disability.
“In a blink of an eye, [children] lost their entire networks for education, exercise and socialization,” said Dr. Omkar Karthikeyan, a pediatrician from IHA, on Mid-Michigan NOW.
However, AAPS remained closed. While some supported this decision due to growing apprehension about the global pandemic, other families began leaving the school district. As the number of students decreased, the per-pupil funding ($9608 per student in this year’s state school budget) also decreased. To illustrate, losing 1,000 students equates to a financial burden of $9.6 million annually, and this decrease in per-pupil funding significantly impacted the budget.
Additionally, there has also been a rise in staff costs — in the past decade, AAPS saw a 29% expansion in their workforce: 480 new employee positions, including 417 teachers, and if that isn’t enough, the school district also raised salaries and benefits by $13 million, under $500 per employee.
Superintendent Jazz Parks stated in the March 13 Budget Update, “Despite our best efforts, the magnitude of the budget challenge we are facing will require us to make staff and program reductions.” As a result, AAPS has been authorized by the school board to start releasing layoff notices, beginning with members of the Association of School and Community Service Administrators, a unit of supervisory staff.
There will be a virtual town hall meeting on Monday, April 15, at 6:30 p.m., which will be recorded and posted for anyone unable to attend the virtual meeting live or unable to join one of the community sessions.
