Statewise, the impact on most schools softened
By Jennifer Crowe
Declining enrollments in some rural Nevada schools will require the state to chip in more money for education, but school finance officials say the shift won't affect other districts - including Washoe County - as long as the state's overall economy stays strong.
Layoffs in sprawling, mining-dependent counties such as Lander and White Pine have left school officials to deal with a double punch to finances. Miners leaving town are taking their families, meaning fewer students in classrooms and less per-pupil money from the state. Compounding the problem: a drop in property values and local sales tax revenues because of a slow economy.
Fewer students would seem to mean less expenditures, but that's not the case. Even though enrollments are dropping, not all expenses are going down. It costs more to educate fewer students in a large geographic area. Ten of Nevada's 17 counties reported a declining school enrollment for the 1998-99 school year, the first time so many schools are seeing fewer students than the previous year.
"Things like transportation will continue even though there's fewer students there. You can't reduce non-teaching expenditures by the same percentage as enrollment," said Doug Thunder, Nevada Department of Education deputy superintendent of finance. "Some of those costs are going to be greater per student."
Dropping sales and property tax revenue impacts go beyond school budgets. County and city governments, which also are heavily dependent on those taxes, are seeing resources shrinking as well. It's unclear what that will mean, but it seems obvious that cuts in services will follow if agencies have less to spend.
"It's not just affecting us," White Pine schools finance chief Paul Johnson said. "All of the local governments are trying to figure out how to do what they do with less."
Schools cutting back: Programs haven't gotten the ax yet, but the district quit filling empty teaching positions two years ago, and with continuing payroll attrition Hensley is anticipating only a $300,000 shortfall this year.
"At our lower grades we're overstaffed by two teachers, but we have to bite that because they were under contract as of May 1," he said. "That's the game. If we knew how much further our enrollment will go down, we could make those hiring decisions before the teacher contracts are signed and save that money."
So far, there are 184 fewer students in White Pine County schools out of a total population of about 1,900. At $5,198 per student, that means at least $956,000 less next year - about 10 percent of the budget - Johnson said.
Fewer families also mean reductions in local tax support, Johnson said: "It's hard to quantify the impact on motor vehicle privilege tax, sales tax and assessed value. The Nevada Plan will compensate for a portion of the assessed value reduction, but not all of it."
Seventy-five cents per every $100 of assessed value is collected for school district operating costs such as salaries, maintenance and supplies. When local property values decline, that pool of money shrinks. The Nevada Plan - the state funding mechanism that provides more state money to school districts with a smaller local tax bases - will make up about 25 cents of the total 75 cents, Johnson said.
White Pine County school officials began planning earlier this year how to survive the revenue cuts expected from the closure of the Robinson mine in nearby Ruth. A district hiring freeze in place since February was only lifted right before the start of school to hire a few teachers. Staff who have retired or moved are not being replaced. Rather, other employees have taken on more responsibilities, White Pine Superintendent Mark Shellinger said.
A special education teacher took over the early childhood program, and a vice-principal at White Pine High School is doing double duty as principal of the McGill school. The special programs director has taken on principal duties at the Murry Street Kindergarten Center, and the counseling secretary at the high school also supervises the in-school suspension room.
"We're really handcuffed by the property tax rates," Johnson said of the state-mandated $3.64 cap per $100 of assessed property value. "Our demand for revenue is more than what the tax cap is allowing. We're forced to reduce costs to get down to the cap."
State money fills gaps:
RENO GAZETTE-JOURNAL
Although the problems in mining communities don't translate into less money for schools in Washoe County and Carson City, it does mean there is less money in the state general fund for other projects.
Per-pupil payments to the counties vary depending on local factors such as transportation costs and the county's relative wealth in property and resources. Per-pupil totals range from $1,956 in Eureka County, which has substantial local resources, to $7,419 in Esmeralda County, which doesn't.
A safety net for schools has come in handy this year for districts like White Pine and Lander that are facing dropping enrollments. Districts can use the prior year's student count in the case of a population drop to give schools a year to adjust. Areas affected by mine layoffs are taking advantage, but those districts also are trying to figure out how to deal with less money in the coming years if enrollment doesn't rebound.
Although the economic situation is making it hard in some rural counties, state officials are not worried about education funding in general because sales taxes have exceeded projections. More than a third of state money comes from sales taxes.
Sales tax must stay strong:For the fiscal year that ended June 30, statewide sales tax was up 10.5 percent, according to the Nevada Department of Taxation. Clark and Washoe counties deserve much of the credit for that increase, because revenues are declining in rural areas, including Lander County. As long as the larger counties continue to grow, there's little difficulty in making up shortfalls in the smaller ones.
However, if sales taxes started declining, education funding could be cut across the state. Sales-tax declines often signal a slump in the economy, meaning other taxes from tourism and gaming also could drop.
If sales tax or other school support comes in under projection, the Legislature has to make a supplemental appropriation to cover the difference. Since 1982, the state has had to make five supplemental appropriations totaling $107 million. In nine other years local revenues exceeded projections, and nearly $300 million was sent from the state school account back to the general fund.
"The biggest supplemental was in 1992-93, and that was when we were in a recession," Botts said. "More often we've given money back to the general fund, which is indicative of our booming economy."