Enrollment went down but staffing went up: District to host public sessions reviewing situation

By Holly Dillemuth, Ashland.news

After years of increasing staffing even as enrollment declined, Ashland School District needs to reduce its 2024-2025 fiscal year budget by more than $2.2 million by mid-2025, according to a review by a statewide education official. Superintendent Joseph Hattrick is asking staff and the public to weigh in on a district plan on how to move forward with cuts.

The financial state of the district was shared during an Ashland School Board special work session attended by many local residents Thursday in the Ashland council chamber. 

Ashland School District (ASD) has an anticipated negative fund balance for fiscal year 2024-2025 (July 1, 2024, to June 30, 2025) totaling $1,037,182, according to budget review presentation by Jackie Olsen, executive director of Oregon Association of School Business Officials (OASBO). The district is projected to have about $38 million in revenue for the 2024-25 fiscal year, with expenditures projected at $40.2 million.

ASD has an anticipated cash balance of $2,789,079 through June 2025, but the amount will not cover expenditures through October 2025 if spending continues without course corrections, according to an analysis of the budget.

The district will host a staff-only session on Monday, Nov. 25, to review the situation, followed by public community feedback sessions Monday through Thursday, Dec. 2-5.

Olsen’s overview of the ASD budget was cordial, but frank.

She shared that current staffing at Ashland School District is on par with that in 2018-19, when the district had 300 more students.

“For a district your size, losing a few hundred kids has a significant impact on your budget,” Olsen said. “Your enrollment has decreased over time and your staffing has significantly increased – you are going in opposite directions and so, with less kids, you get less money, and you’re spending more on staffing.”

“I would say ESSER (Elementary and Secondary Education Emergency Relief Fund) has a big chunk of this in 2022 and 2023, but the district didn’t right-size staff at the rate that it needed to with declining enrollment and the revenue it was actually receiving,” Olsen said.

Olsen is providing extra assistance to review the budget after a a prior extensive independent review after Hattrick started as superintendent on July 1. 

“She has supported districts across the state in navigating similar challenges,” Hattrick said, “and asking Jackie to come in is an even more objective lens, with the expertise to do this work.”

Hattrick implemented a spending and hiring freeze to stop the district’s “financial bleed” in September, the first step of several in a strategy to address budgetary concerns.

He also performed a cross-analysis of how last year’s budget translated into building this year’s budget.

“And my findings were surprising,” he said at Thursday’s meeting, leading him to seek further review.

Hattrick emphasized he told Olsen to provide completely transparent information about the budget.

“Asking Jackie to come in is an even more objective lens, with the expertise to really do this work,” he said. “From the start, I did promise I’m going to be transparent, even if it’s ugly.”

Olsen presented an overview of various portions of the budget, noting that 86% of the general fund is made up of salaries and benefits.

“There are 15 special revenue funds that are projected to have a negative fund balance at the end of ‘23-’24 to start ‘24-’25,” Olsen said. “The largest three I’ve listed on here. Food service is estimated at about $960,000. ESSER (funds were) overspent back in 2022-23 by $762,000. There is a transportation fund that helps pay for replacing buses. That was negative $498,000.”

Hattrick is working with the Oregon Department of Education, USDA and the district’s nutrition department, in particular, on a path forward.

“They have allowed me to loop that into a three to five-year (repayment) plan,” Hattrick said.

“Truthfully,” Olsen said, “the district should’ve reduced general fund expenditures at the time the budget was adopted, so you budgeted $400,000 that you don’t really have to spend, but the overall revenues and expenditures projected still were negative $1.037 (million).”

Olsen recommended that the board adopt a new way of reviewing budget data.

“At this time,” she said, “if you continue expensing money at the rate that you are and make no additional changes, you may need to take out what is called a TAN — a short-term tax anticipation note.”

A TAN is a loan, with interest, that the district would need to repay within six months.

“It’s not the worst thing to have to take out … but you do pay interest,” Olsen said.

She also cautioned against blaming one person or department for the financial situation.

“I’ve been the only person in the business office and it’s never a one-man job,” Olsens said, “so this is not a department, this is not a person — the district got to this place because of an entire district.

“Every single person has a job, starting with the superintendent and how data is shared and how it is presented in the leading of board meetings and the leading of the budget,” she added. “Every single other employee has the same responsibility to that budget. I expect my principals to watch their budgets, and to know how much they approve in overtime, knowing what the fund balances are and approving the budgets and reviewing the audit. 

“Ashland School District has to own this,” she added. “This really is a school district issue and the amount of overspending that has happened at so many levels, and I know that’s difficult to hear.”

Hattrick said the financial situation at the district was part of the job description when he applied for the role. He also recalled that, while riding in a car in the Fourth of July parade shortly after his first day on the job on July 1, he’d heard someone scream from the crowd, “‘Save our budget!’

“That really made it very clear that not only did the board and the community set the expectation from the start, it’s also an expectation of the community that our staff and our students to get off this roller coaster that the district’s been on for years,” Hattrick said.

Hattrick encouraged those with more questions and comments to come to public input sessions starting Dec. 2 at Ashland High School.

“We believe that your input is essential as we navigate this process together, starting with our staff,” Hattrick said. “I understand that this can be a stressful time for many because this may be the first time hearing the unfiltered realities of our financial position. This is something I have committed to providing this wonderful community and staff: full transparency. As we present(ed) on Thursday, I would ask that we keep in mind, the goal of transparent presentation is to give all of the information so that we can problem-solve together.”

School Board Chair Rebecca Dyson emphasized that the school board has been well aware of the issues at hand since before the body selected Hattrick to lead the district.

“We would like to acknowledge that this special financial session has been a long time coming,” Dyson said. “From the time before we began our search for a new superintendent, the board was aware that developing state and federal budget issues would require a leader with very strong financial expertise and experience. This was a key consideration when we chose Dr. Hattrick and we are thankful that in the four months since he has been here, we’ve gotten to this point where we can lay out a much clearer picture of where we stand and what our options are moving forward. 

“We do understand that these are very difficult and stressful issues, but I want everyone to keep in mind that another one of our goals in bringing Dr. Hattrick on board (was to have someone) who would foster a renewed and deeper sense of community and trust,” she added.

Hattrick sent a notice of the discussions and plans for a staff-only input session planned on Monday, Nov. 25.

An anonymous individual claiming to be an Ashland School District employee among those to receive the notice posted it in part to a Facebook community group Friday morning.

“Big changes are coming and it’s got a lot of people worried about the future, myself included,” the individual wrote. 

Hattrick ensured those in attendance and watching online on Thursday that the process will be public and interactive, with input sessions giving opportunities for comments and questions.

“We will get through this together,” he said.

Email Ashland.news staff reporter Holly Dillemuth at [email protected].