Board of Education Adopts FY 2010 Operating Budget of $2.13 Billion

February 9, 2009
Despite Lowest Overall Increase in More Than a Decade, Board Adopts Plan That Will Preserve Key Academic Initiatives and Hold the Line on Class Size

Recent Boost in State Aid Projections Will Help to Offset Employee Benefit Costs

The Montgomery County Board of Education today adopted a $2.13 billion Fiscal Year 2010 Operating Budget that will preserve key academic reforms in the school system’s strategic plan and hold the line on average class size by eliminating employee cost-of-living adjustments and requiring major cost-savings efforts in the current and next fiscal year. The adopted budget, which passed in a 5-1 vote, is just 3.1 percent higher than that of the current year’s approved budget of $2.07 billion for Montgomery County Public Schools (MCPS) and marks the lowest overall increase in more than a decade.

“The lean nature of this budget is a clear reflection of the difficult choices that we must make in today’s economic climate” said Patricia O’Neill, vice president of the Board of Education. “But I also believe it’s a responsible budget that demonstrates our strong commitment to protecting initiatives that raise student achievement and to avoiding cuts that are harmful to classroom instruction.” Ms. O’Neill presided over today’s session, due to the absence of Board President Shirley Brandman, who was unable to attend because of a death in her family.

While the Board’s adopted budget is approximately $23.7 million higher than the budget proposed by Superintendent Jerry D. Weast in December, it is consistent with the updated recommendation that the superintendent sent to the Board after projected state aid to MCPS was increased in the Governor’s recent budget recommendation. The anticipated state aid increase is based on factors such as increased enrollment, the rectification of an error that the state made in calculating aid for Fiscal Year 2009, and a continued decline in Montgomery County wealth compared with other Maryland counties.

The revisions in the superintendent’s updated recommendation add to the contribution amounts that were previously budgeted for employee benefits, including those to the Retiree Health Trust Fund, the Employee Benefit Plan Internal Service Fund, and the Montgomery County Public Schools Employee Retirement and Pension Systems Plan.

“This is one of the most difficult budget years I have ever seen, but I think the plan the Board has adopted charts a prudent course and will enable us to maintain the progress we have been making in raising student achievement,” said Dr. Jerry D. Weast, superintendent of schools. Dr. Weast noted the importance of this year’s $20 million savings plan—which will be carried over to help fund the FY 2010 budget—and more than $35 million in cuts for next year in the preparation of the FY 2010 Operating Budget. The school system has had a severe hiring and spending freeze in place since last September, in order to achieve the targeted savings in this year’s budget.

In adopting the FY 2010 Operating Budget, the Board noted that because of the severity of the economic situation, it is still possible that the school system may not receive all of the additional state aid now projected. In particular, the Board was mindful of the fact that the Governor’s proposed restoration of an estimated $24.2 million shortfall in state aid for FY 2009—as a result of the wealth formula miscalculation—will still require the approval of the legislature. These funds, when received, would contribute to the Fiscal Year 2009 ending fund balance and could be appropriated in future years.

With regard to the possibility of additional federal funding that could result from the economic stimulus package now being debated in Congress, the Board decided not to make changes in the total amount of the operating budget until there is more clarity on the likely amount and composition of the federal aid.

Board members noted that a key aspect of balancing next year’s budget was the recently completed renegotiations with the school system’s four employee associations, which all voted to support a forgoing of their employee cost-of-living adjustments. “I really want to thank our employee associations for their willingness to renegotiate their contracts—$89 million in savings is an incredibly significant part of making this budget work,” noted Vice President O’Neill, on behalf of the Board. “We would never have been able to adopt this budget without their commitment and their willingness to make sacrifices.”

The Board of Education’s adoption of its Fiscal Year 2010 Operating Budget follows completion of a series of public hearings and budget worksessions. The adopted budget will now be sent to County Executive Isiah Leggett, who will present his budget for all agencies—including MCPS—to the County Council on March 16. The Council will hold a series of public hearings and worksessions before taking final action on the county’s operating budget in late May.

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