North Wasco County School District 21 facing budget reductions

“Like many school districts across Oregon, NWCSD is facing significant budget reductions for the upcoming 2025-26 school year,” Bernal said. “This is due to several key factors, including lower student enrollment, the expiration of federal pandemic relief funding and rising costs from inflation.”

Enrollment numbers were a point of discussion during the Chief Financial Officer (CFO) Randy Anderson’s report at the Feb. 27 school board meeting. While acknowledging an unusual uptick in current enrollment, Anderson reminded the board that the original enrollment estimate was submitted to the Oregon Department of Education (ODE) in December 2023 was too high, and had to be recalculated.

“They’ve recalculated the State School Fund (SSF), and our share of the state school fund in the next three payments is reduced by $1,087,000 from the original estimate,” Anderson said.

According to the Oregon Secretary of State website, “Oregon uses a formula to provide financial equity among school districts. Each school district receives (in combined state and local funds) an allocation per student, plus an additional amount for each student enrolled in more costly programs such as Special Education or English Language Learners.” Oregon’s general fund provides approximately two-thirds of school budgets, according to Oregon Public Broadcasting.

During the 2023-24 school year, a similar reduction in funds took place when it was determined that the district’s enrollment estimate was also too high. As previously reported by Columbia Gorge News, former district CFO Kara Flath reported that NWCSD received a small increase in SSF funds in January 2024, from $24.5 million to $24.8 million, before being reduced to $23.4 million after being short 130 students from the original projection.

“Public school enrollment is decreasing due to lower birth rates and limited access to affordable housing. We have approximately 142 fewer students enrolled in our district than we did 5 years ago,” Bernal said in the video. “To put this into perspective, this drop in enrollment equates to a loss of over $1.4 million in state school funding each year. During this same time frame, we added more staff to serve and support students as we recovered from the pandemic’s impacts with the assistance of our federal pandemic relief dollars.”

NWCSD received Elementary and Secondary School Emergency Relief I (ESSER) Funds, which were funded by the Coronavirus Aid Relief and Economic Security (CARES) Act and granted to state educational agencies (SEAs) “for the purpose of providing local educational agencies (LEAs) with emergency relief funds to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools,” according to Oregon.gov.

As previously reported by Columbia Gorge News, the district had until Sept. 30, 2024, to spend remaining pandemic relief funds.

The video also cited an increase in mandated Public Employees Retirement System (PERS) contributions as another reason for budget reductions. During the Oct. 24, 2024, school board meeting, Anderson discussed the PERS Board’s decision to increase the mandatory contributions more than 12%, which he stated is “more than double what they are now.

“What that means is … for the current salary level, next year’s budget will need to be $3.3 million bigger, and we’re just $3.3 million short of being able to do that, so far,” Anderson said at the Oct. 24 meeting.

“It is a huge shock, the biggest increase that I’ve ever experienced, and it’s going to be a significant mountain,” he said.

According to Bernal, no additional funding is expected to offset the additional $3.3 million cost to the 2025-26 budget.

At the time of the video’s release, the updated numbers estimate for the Oregon SSF had not yet been released, but NWCSD estimated a shortfall of $2.1 million for the 2025-26 school year, based off of the state school fund recommendation at the time. Since its release, the Governor’s Recommended Budget for 2025-27 currently proposes $11,359.4 million for the SSF.

Columbia Gorge News reached out to the district regarding whether the updated estimate had an effect on anticipated budget reductions. A statement released by Bernal on April 3 said that the numbers had “no impact on the anticipated budget shortfalls.”

According to the statement, NWCSD has reviewed revenue sources including property taxes, federal funding and Student and High School Success funds to gain “an accurate and prudent estimate” for a comprehensive understanding where it is currently stands financially.

“To ensure financial stability, we are developing budget and staffing scenarios that align expenditures with projected revenue. Again, our other key considerations in our long-term financial planning include inflation, support service costs, federal education funding, and pension obligations,” said the statement.

Budget committee meetings start next month on May 6. Budget committee meetings meet for the purpose of estimating “the cost to operate District schools and programs for the next fiscal year.” A second meeting is scheduled to take place on May 14, with another slated for May 20 if necessary. The budget is scheduled to be proposed for adoption by the school board on June 26.

In the video, Bernal stated that while no final decisions have currently been made, with the majority of the operating budget being allocated towards paying total compensations, NWCSD is considering reductions in both district “operations and efficiencies” and staff positions, including administrative, licensed and classified positions.

“Obviously, there is no easy way to make these decisions, and we recognize the uncertainty these discussions may cause,” Bernal said in the forecasting video, “While we do not want to cause alarm, we want to be upfront with our staff and our families, as we prepare this coming year’s budget. We will continue to give regular budget updates as we are able and as things evolve.”