FORT SMITH -- Employees in the Fort Smith School District will see no base increase in their salary schedules as a result of the covid-19 pandemic.
The Fort Smith School Board approved proposed certified and classified salary schedules for employees for 2020-21 during its regular meeting Monday. Fort Smith School District Chief Financial Officer Charles Warren said these salary schedules include a combined total of 1,800 full-time employees.
The pay of employees varies widely based on job, education and experience. The minimum certified pay is $38,500.
The matter was discussed by the school board on two previous occasions. While presenting the board with a school finance update from the school business office during the board's regular meeting April 27, Warren said the office recommended no base increase on the salary schedules at the time due to the impact of covid-19 on the office's financial projections.
"As a financial adviser to the district, I feel like it's my role and my duty to exercise my judgment and to show that, at this time, it doesn't feel like there is available revenue to be able to put on the salary schedule," Warren said.
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"And so that's why we're looking at making a recommendation to the staff and to the school board that we will be working on salary schedules that will not change, except for in title, for the next year and bring that to you, hopefully for the May school board meeting."
During the April 27 meeting, Warren provided the board with information regarding four "factors of funding" that have to do with local and state revenue. A combination of these factors are used in the calculation of new revenue for the school district. The four factors include millage, assessed values, the foundation funding rate and student count.
These four funding factors were used to calculate projected state revenue growth for the 2021 fiscal year, which Warren said was determined to be $2,354,908. State categorical revenue growth for the same fiscal year was projected at $52,108. These two numbers, combined with no projected local revenue growth, bring the total amount of new revenue available for the school district for 2020-21 to $2,407,016.
Warren also said there are inevitable savings when employees who retire are replaced with someone who may be right out of college and are on a lower salary schedule. These "replacement savings" for 2020-21 were projected at $780,469. While this is offset to an extent by $220,558 in projected educational increment costs for the district, which are incurred with college credit earned by employees, it results in an additional $559,911 in net available funds for the next school year. This brings the total new projected revenue to $2,966,927.
However, Warren said the covid-19 pandemic cast a shadow over the school business office's financial projections.
During an interview on Monday, Fort Smith School District Superintendent Doug Brubaker said that the school district does not know what the 2020-21 school year is going to look like and what its additional expenses will be. As a result, the school district is trying to be very careful with its revenues and is taking a "conservative approach" in the next year.
"When you look at each of [the four factors of funding], you don't know how those factors will be affected in the coming year, and there may be an echo effect from the pandemic that reverberates throughout the whole economy, and our revenues are dependent on that," Brubaker said. "And so, like many other districts in the state of Arkansas, we're just being very cautious and careful."
Warren said during the same interview Monday that it is important to realize that money added to a salary schedule base impacts not only the next school year but also years afterward. In addition, that money cannot be taken away after the first year if there are any other cuts in education or if there is not growth that will continue to increase beyond that year.
"The shadow is not so much what may happen in FY21, but the fact that we don't really know what the impact long-term is going to be on FY22 and thereafter," Warren said. "The decisions we make today on the salary base are not just about how it's impacted for the next year, but years after that."
Fort Smith School Board President Bill Hanesworth said Monday that the board and school district are going to be forced to look at what education, and a business model, looks like after the pandemic.
"And I think being prudent, trying to understand that, is part of what the board and the district is faced with," Hanesworth said. "What does this look like on the other side? And I think most people would say, 'It's going to be different, but I can't tell you how yet.'"
Despite the lack of salary schedule base increase, however, a memo that was included in the agenda packet for the school board's May 11 work session said that employees will still be eligible for the step increase available to them for the contract year of fiscal 2021, with there being no steps after Step 21 in the salary schedules.
The average certified staff salary increase is 1.1% percent and the average classified staff salary increase is almost 1% as a result of step increases.
State Desk on 05/19/2020