The tentative agreement between Seattle Public Schools and its teachers union could deplete the district’s rainy-day fund and still leave SPS with a multimillion-dollar budget shortfall, school officials say.
If approved by the Seattle Education Association and the School Board, the three-year agreement would cost the district $228 million. The district has already projected millions of dollars in budget shortfalls for the next three school years, and the contract would add nearly $92 million to that shortfall.
“We know what we have to do,” said Seattle Superintendent Brent Jones in an interview. “It’s not necessarily ideal.” But, he said, “we want to make sure teachers have the resources they need, and we want to make sure they’re paid wages that are competitive.”
SEA members will vote on whether to ratify the collective bargaining agreement on Monday. The Seattle School Board must also vote to approve the contract.
The union’s 6,000 members went on strike Sept. 7, what would have been the first day of school. Members voted to end the strike on the fifth day. School started on Wednesday, a day after SEA and the district reached a tentative agreement.
If the tentative agreement isn’t approved by the union, the two sides will likely need to renegotiate. The vote to end the strike was close — 78% of members voted and 57% of those members approved the motion to suspend the strike.
Contract costs, which were presented to the School Board on Wednesday, are rough estimates and still need to be finalized, said Rob Gannon, deputy superintendent.
“To get done the things that we’re trying to do that are aspirational — it costs money,” Jones said in the interview. “My hope is that it’ll all be worth it.”
The amount of money school districts receive largely depends on student enrollment, and those numbers have continued to drop in Seattle in the last two years. It’s a nationwide trend, but Seattle has seen an especially steep enrollment plunge. This school year, officials projected the smallest enrollment SPS has seen in seven years — about 49,000 students. Official numbers won’t be available until October.
District officials still have to analyze ways to balance the budget, Jones said. “We have to figure it out.”
“I stay consistently concerned about how we’re allocating resources,” he added. “We know what we need to do at this point, it’s just a matter of buckling down and doing it.”
For the current school year, the contract would cost SPS more than $50 million, Gannon said, which would put the district $11.7 million over budget. But Gannon said he believes finances could be balanced without program cuts, in part by using federal pandemic relief dollars given to all public school districts in the country to offset COVID-19 expenditures. Seattle has been granted about $145 million in Elementary and Secondary School Emergency Relief funds, although it has already spent some of that money.
“We have figured out ways within our resources by shifting dollars, tapping into planned contingency funds, and using ESSER funds as available to say that the current fiscal year should be balanced,” Gannon said at the board meeting.
The second year (the 2023-24 school year), the contract would cost the district about $78.6 million and add about $32.8 million to the budget shortfall, Gannon said in an email.
The district could pull money out of its economic stabilization fund, a pot of emergency money, to balance costs for the 2023-24 school year, Gannon said. The fund, a kind of rainy-day fund, currently has $39 million.
In the 2024-25 school year, the contract would cost SPS about $99.2 million and contribute $47.3 million to budget shortfalls, according to Gannon. And if the district used emergency funds to fix the problem in 2023-24, that money won’t be available the third year of the contract, he said.
In addition, if the economic stabilization fund is used up, the district needs to come up with a plan to replenish it, per board policy.
Officials will begin developing the budget for the 2023-24 school year in October.
“We will evaluate all possibilities to address the budget shortfall, including both reductions in expenditures and increases in revenues,” Gannon said in an email. “Any material resource increase would need to come from new or increased state allocation.”
Seattle Schools doesn’t have any other funds to draw from, Jones said during the board meeting. “That’s come and gone a long time ago. We are at the limit in terms of utilization of extra funds and we are even to the point where we are probably stretched beyond the capacity currently.”
Overall, more than 80% of the district’s budget goes toward salaries. The general fund for the current school year is $1.14 billion, the bulk of the budget, and is used for everyday operations, such as educational programs, salaries, technology and transportation.
Under the proposed contract, SPS agreed to pay raises of 7% for both certificated and classified staff. Originally, the district proposed a 6.5% increase, which included a state-funded 5.5% inflationary adjustment.
In the second year of the contract, members would receive a 4% salary increase for inflation and 3% the following year. If the state funds a higher inflationary adjustment, union members will receive whichever is greater, the tentative agreement says.
SEA was fighting for more manageable caseloads and teacher-to-student ratios in the special education and multilingual programs. Uti Hawkins, SEA vice president and bargaining chair, said the union was able to maintain ratios but increase the number of staff in classrooms to provide more support.
Although more student supports and higher salaries for educators cost more than what the district currently has, it’s necessary to meet the district’s goals, Jones said.