Schools in the New Economy

With more than 30 years of unrelenting enrollment growth, leaders in the Cypress-Fairbanks (Texas) district approached a 2007 bond election with the expectation that the hectic pace of classroom construction would continue for several years at least. The $807 million program authorized Cypress-Fairbanks to build eight elementary schools, three middle schools and two high schools.

But since voters approved the building plan in November 2007, the nation’s economy has hit the skids, and projects that once seemed feasible—crucial, even—now are fraught with financial peril. So while enrollment continues to climb in Cypress-Fairbanks—it surpassed 100,000 students in 2008—the new campuses that would have accommodated those additional children are not being built. The board has pushed back the construction of 10 schools by two to six years.

Schools and universities across the United States have been forced to cope with a grim financial situation that has left them without adequate resources. Administrators are cutting programs, reining in salaries and jettisoning employees to keep operating budgets in line. Education institutions also have had to shutter facilities or postpone, cancel or downsize vital construction projects.

"We’ll continue to evaluate the financial situation, so we can make recommendations on when to proceed, but we don’t have any expectation that the situation is going to change any time soon," says Pam Wells, associate superintendent of facilities, planning and community relations in Cypress-Fairbanks.

Staying afloat

Education institutions have become accustomed to getting by with dwindling financial support, and as leaders look to 2011-12 and beyond, they already have trimmed the low-hanging fruit of easy budget cuts; federal stimulus funds that provided temporary relief are mostly depleted, and administrators now are having to make more painful and damaging cutbacks. Hardly a day goes by without a school or university announcing that it is shutting a facility, laying off personnel, terminating popular programs and deferring planned improvements:

•The Roman Catholic Archdiocese of New York announced earlier this year that it is closing 27 schools when the school year ends.

•The Charlotte-Mecklenburg County (N.C.) district plans to shut 11 schools at the end of the school year.

•The California Community Colleges chancellor estimates that cuts proposed in the governor’s budget would force the state’s community colleges to turn away 350,000 students.

•The Clark County (Nev.) district projects that proposed state funding reductions could lead to the layoff of more than 3,000 district workers.

•Illinois Governor Pat Quinn has proposed an ambitious district consolidation effort that would reduce the number of K-12 school systems from 868 to less than 300. Quinn estimates that merging systems could save the state $100 million in administrative salaries.

The discouraging financial outlook also is prompting schools and universities to re-evaluate whether the facility improvements they have in the works should proceed.

On hold

Often, school systems with a growing enrollment are able to ride out difficult financial conditions more easily than districts with stagnant or declining student numbers. Enrollment increases usually are signs of vibrant development and a growing tax base that provides the resources a district needs to pay for more facilities and programs.

The suburban growth that has fueled enrollment increases in Cypress-Fairbanks—11,758 students in 1975 compared with about 106,000 in 2010—has in recent years not resulted in an easing of the district’s financial burdens. This is because of the Texas school funding law, which Wells characterizes as "inadequate and inequitable." It provides significantly less funding per student than it does to neighboring districts in the Houston area.

That money gap has forced Cypress-Fairbanks to cut spending by $72 million over four years, Wells says. Under the existing state funding formula, administrators don’t see any way their shrunken budget can take on operating costs for the schools they are authorized to build.

"We’ve been dealing with this for some time, but now it has become more acute," says Wells.

So the two elementary schools that opened in August 2010—Emery and Rennell—and the middle school that is scheduled to open in August 2011—may be the last new campuses in the district for a while. In November 2010, for the second year in a row, the school board officially pushed back by a year the planning schedule for the other 10 schools that were part of the 2007 bond program. The six elementary schools, two middle schools and two high schools now have tentative opening dates between 2013 and 2018, but the district warns that the dates could slip further if the budget scenario does not improve.

In the meantime, the district pro-jects it will continue to add 2,000 or more students in each of the next few years.

"We’ll continue to put portable buildings on our campuses," says Wells. "We already have 9,000 of our students in portables. We also might have to modify attendance boundaries to adjust enrollment."

Although construction of new buildings is on ice, Cypress-Fairbanks still is able to take advantage of a favorable construction market by carrying out renovation projects that were included in the 2007 bond proposal.

"Typically, in previous bond programs, we have done new construction first, but because of the situation, we are doing the renovation projects now," says Wells.

Construction moratorium

When education institutions are looking for ways to offset debilitating funding cuts, many colleges and universities have a clear advantage over public K-12 systems: They can raise tuition. In South Carolina, several higher-education institutions reacted to state-imposed budget cuts by hiking their tuition for 2011-12.

That drew the ire of state officials, who felt schools should not be putting more financial burden on students and their families. So the South Carolina State Board of Budget and Control, which is composed of the governor, treasurer, comptroller general, the Senate Finance Committee chairman and House Ways & Means committee chairman, acted in September 2010 to halt campus construction projects at any higher-education institutions that raised tuition too much. For four-year schools, the tuition increase could not exceed 7 percent; for two-year schools, the increase was capped at 6.3 percent.

The construction moratorium did not apply to projects funded solely from private donations. It also made exceptions for work that addresses only deferred maintenance and improvements designed primarily to address health and life-safety concerns.

Most of the schools affected quickly acted to reduce their tuition hikes so that the construction moratorium would not affect them. The trustees of the University of South Carolina system had increased tuition by 9.5 percent at USC Beaufort, a former two-year campus, so that student costs would be more in line with the system’s other four-year campuses. But the trustees rolled back the increase to 7 percent so that the school could complete construction on the second floor of the campus library.

Clemson University, which had raised tuition by 7.5 percent, lowered the increase to 7 percent. In recommending the lower tuition, University President James Barker cited two projects: renovations and additions to Freeman Hall, an industrial engineering building, and upgrades of biomedical research facilities at Greenville Hospital System’s Patewood campus.

Delbert Singleton, a spokesman for the Budget and Control board, says only three institutions have declined to lower their tuition and lift the moratorium: The Citadel, a four-year institution; and two two-year technical colleges: Orangeburg-Calhoun and Williamsburg.

The Citadel, a military college that requires all students to live on campus, increased tuition by 13 percent. But when room and board are included, officials pointed out, the increase amounts to 6.3 percent for in-state students. In addition, The Citadel does not have any pending construction projects.

Progress halted

It’s not just higher-education officials that can have their facility-improvement plans thwarted by state officials trying to balance their budgets.

Since 2003, the New York City school system has added new facilities that provide classroom seats for more than 100,000 students. After the resolution in 2007 of a school-funding lawsuit, the state of New York promised to increase state education funding by $7 billion and agreed to split with the city the costs of new school construction.

But new Gov. Andrew Cuomo says the state can’t afford to provide the education funding New York City was expecting. The cuts he proposed in education spending prompted city officials to scale back school construction plans through 2014.

The city’s 2010-2014 capital plan had called for funding construction of enough classrooms to accommodate 30,377 seats. After the governor’s budget proposal was announced, the city education department downsized the capital plan to provide funding for only 14,573 new school seats.

"Albany’s proposed cuts to our school construction efforts will mean more overcrowding, fewer new buildings and deteriorating conditions at our existing buildings," says New York City Schools Chancellor Cathleen Black. "We understand the need to invest wisely during these tough budget times, but the state’s decision to cut back on school construction aid means that we will not be able to keep up with the projected demand across the city."

Sidebar: Aiming for efficiency

Faced with a projected $10 million budget deficit, aging facilities and a desire to operate its facilities more efficiently, the Montgomery (Ala.) school district has decided to consolidate its campuses by closing four elementary schools and two middle schools.

Officials estimate the reorganization will save the 30,000-student district about $2.2 million a year.

The board voted to close Hayneville Road, Harrison, Head and McKee elementary schools. The McKee building will become the new home for MacMillan Elementary Magnet School. Also to close at the end of the 2011-12 school year are McIntyre and Houston Hill middle schools, and the Daisy Lawrence building, which housed a preschool program.

The new attendance boundaries for schools will result in more students living closer to the schools they attend.

Kennedy, staff writer, can be reached at [email protected].

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