LAS CRUCES, N.M. - Las Cruces Public Schools were recently forced to give some of its reserve funds back to the state and district officials are waiting to hear what next year's budget will be like.
Last week, Governor Susana Martinez slashed $46 million from local school district reserves in an effort to fix New Mexico's budget crisis, including $3.5 million from LCPS.
Superintendent Greg Erwing tells ABC-7 each school district has reserve funds to pay for bills throughout the month and reserve funds for the district were initially at $10 million. Erwing said the district gave all employees a raise and restored furlough for all employees except principals and central office administrators. The move brought the district down to $7 million, the minimum it needs to operate the each month and stay solvent as a school district, Erwing said.
Recently, LCPS had to return some money to the state, including $2.9 million from the "SEG," which is the amount of money given to the district per pupil to run the district, $500,000 in bussing, and $190,000 for textbooks and materials.
Last week, with recent legislation passed, LCPS was forced to return another $3.5 million, putting the district's reserve funds down to $3.5 million. Superintendent Erwing says it's a critical level, because most school districts across the country like to have reserve funds equal to one month's payroll, which is $13.9 million for LCPS.
"We've instituted a hiring freeze, and instituted a spending freeze, as best you can, obviously when you have an opening in a classroom you have to hire a teacher, obviously we have to have expenditures, we have winter and spring sports going on, I have to have coaches, we have to have people to take tickets, we have to have police officers working those games, so we're just being the stewards we can be with the money now, but it is impacting. It's impacting the district, it's impacting the classroom, and it's impacting children. And so our message is, we feel like we've given all we can give, we absolutely cannot afford anymore cuts," Superintendent Erwing said.
Erwing said the focus now is getting through the remainder of school year with what's left in the reserve fund. The fiscal year for all school districts being July 1st, Superintendent Erwing says as they begin to plan for next year, the district will have to build reserves up back to $7 million.
"If we can stay status quo, we think we can make up the $3.5 million and we'll be fine," Erwing said.
It's unclear how the district will do that, but Erwing says first and foremost, he'll need to know exactly how much the district will receive for the next school year, which is something the legislature will decide. Once they have that amount, Erwing says they'll begin to build "budget committees" with students, teachers and stakeholders who will recommend ideas for next year's budget. Once the budget is completed, it'll be presented to the board which has ultimate authority over the budget.
"We'll look at all of that and then we will present to our board of education, a list of options from the administration and then the board will be the one who actually decide the final budget process and the budget package."
Approximately 90% of the district's budget is personnel costs. Erwing says the district will likely have 50 less employees next year out of almost 3500 employees.
"We're very hopeful and very optimistic we can do that through attrition. So we simply will not fill some positions as the individuals retire, resign or move away."
Erwing says at this time, the district does not have any intention of asking employees to give up furlough days, or laying off any employees, and not intention of recommending to the board that any employee takes a pay cut.
Erwing says they will give the board several recommendations where they feel like they can make cuts. He says cuts in the classroom are extremely painful, even when class sizes are increased by just one student. He says the district likes to have a low pupil-teacher ratio, but increasing class sizes makes it difficult to improve certain subjects.
"As we're trying to work on reading scores, math scores, the governor has spoken about 3rd grade reading scores and how important that is and we certainly believe that, but we certainly can't have all kids reading on grade reading level, 3rd grade, if our classes our overcrowded."
When Governor Martinez signed Senate Bill 114, which cut reserve funds, she said she was pleased that the bill protects classrooms and doesn't make families foot the bill. Governor Martinez had previously called those reserves, "slush funds."
ABC-7 asked Superintendent Erwing what he thought about Governor Martinez calling reserve funds "slush funds." He says as an educator, he works with operational funds, adding LCPS does not have extra money to play with.
"I think we all make mistakes when we speak, each day, and I'm sure I make mistakes as well, I think as we have gone through this process, school districts and superintendents have certainly been vocal to say, we certainly don't consider that a slush fund. We consider that an operational fund, in order for us to survive month to month."
Erwing says if more cuts are proposed, the district could potentially be insolvent and have no money in the fund. He says if that did happen, it would force the district to make major changes including cutting even more positions.
"Right now, I think we could be good neighbors, citizens, good sportsmen, and we can work with what has happened so far, but we certainly cannot take any additional cuts. That is a big concern for us."
The district hopes to hear what the budget will be in the next few weeks.