Sullivan: After Rabold rebuttal about school funding, legitimate questions remain

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Recently, Fayette County School Board member Mr. Roy Rabold wrote to this paper with feedback on ideas I presented on these pages. I appreciate him taking time to respond and add to our conversation.

First, as he notes, these articles are meant to be a discussion of issues and ideas and I am not offended by disagreement and certainly do not feel thrown under the bus. More importantly, many “what if” alternatives are not proven solutions but rather potential avenues of exploration.

As I respond to some of his points, I want to be clear that while we disagree, I do have admiration and respect for Mr. Rabold.

Back to the excellent Fayette County Schools. Mr. Rabold properly summarizes what my point has been, Expenses are growing at a rate of five percent, but the revenue growth is capped at three percent. Therefore, without additional revenue, the budget growth is also limited to three percent. End of the day, we need to change our plans to react to the current situation.

Therefore, I have written about the urgency to find a way to control costs to maximize the resources available in our schools. One avenue I suggested is outsourcing, which has been a consideration across many different entities both public and private.

Mr. Rablod states, “He (me) mentions contracting custodial services to a private vendor. The school district did look at outsourcing custodial services several years ago. The main deterrent for the Board was the custodial employees would not have as good of a benefits package as they have now.

“The scenario did guarantee pay rates of current employees, but they would no longer be under the State Health Benefit Plan or have other school district benefits. Future employees of the vendor would be at lower pay rates under a new benefits package. The savings under that system took several years to realize since the savings came from turning over the staff to pay at lower rates with lesser benefits package.”

That’s true. Personnel cost savings from outsourcing come from removing them from the generous state benefit plans that have cost growth much higher than revenue growth, is a way to save dollars that can be used in the classroom.

After all, the “E” in FCBOE is for education, not employment. By choosing a more robust employment model, the choice is, no matter how well intentioned, to put employees before students. This is a question many employers and leaders struggle with.

Mr. Rabold did correctly point out that our nutrition programs do not use operational or general funds, which is exciting. It seems like experience with the outsourcing model here is mixed. Atlanta Public School has cycled through a few different vendors before bringing it back in house this year from Aramark. Pike County is currently using Sodexo.

While I have focused my articles on finding ways to control costs to provide more money for teachers and school staff, Mr. Rabold states, we could have 187 more teachers if only the taxpayers would give the school board unlimited growth in revenue hidden by the growth in property value.

Unfortunately, Mr. Rabold gives up the reality that the cuts will continue until the taxpayers give up their homestead exemption.

Based on Mr. Rabold’s estimate of $117,000 as the cost of one teacher, this would be an increase of almost twenty-two million dollars or a property tax increase of over fifteen percent based on the local taxes identified in the 2025 budget.

Alternatively, Mr. Rabold and the rest of the FCBOE could also choose to raise rates by asking the voters to increase the milage rates above twenty mills. This would also provide the same 187 teachers. However, standing before the taxpayers and asking for a tax increase and making the case based on facts and not emotions is not as easy as it sounds. Trust me I know.

We all remember that this latest homestead exemption was voted by the taxpayers after the FCBOE voted itself a brand-new middle school (Booth) from ESPLOST III funds without previously disclosing this to taxpayers before the vote.

For voters such as myself, this choice ended the implicit trust that had existed. While I still trust the school system, I voted for the exemption as a control on spending to create greater visibility. Ironically, the motion to build the new Booth Middle School made by Mr. Rabold.

While Mr. Rabold brings us back to 1986, I would rather start at 2007 when I got publicly involved with the first ESPLOST that passed as I was in high school in 1986. That ESPLOST was passed by the voters after an earlier one was defeated.

His comments on my reserve position, missed the mark. He focused on cash management and ignored actual spending. When revenues exceed the expenditures, you are building reserves. In this example, FCBOE is cutting school staff while choosing to put Fayette taxpayer money in the bank.

He is correct that FCBOE has not had to use a tax anticipation note (TAN) in a few years. This is a form of short-term financing to operate while taxes are collected. My understanding is that FCBOE will be obtaining a TAN this fall.

Last, I am troubled that Mr. Rabold focused on the GHSA implications of my article regarding sports coaches while failing to be mindful of the point. To be clear, I was asking how we can have great coaches while also making sure we hire great teachers. I had privately made him aware of a situation regarding one of our teachers who was reduced in the latest downsizing.

I was glad to hear that everyone who wanted a job was offered one. However, one teacher was made a floating sub. Subsequently she became aware of a position that became available in one of our schools due to a resignation. She was told that position was getting posted to the street as that school required a coach.

Later that same week, McIntosh released their baseball and softball coaches from their coaching positions, although they were welcome to stay as teachers.

The question I asked Mr. Rabold was how could we cut seventy school-based positions, yet go over headcount compliment to hire coaches while keeping the former coaches as teachers? My suggestions were in attempt to brainstorm a way out of the world where we incurred additional expenses for coaching headcount but not math (or other applicable subject) headcount.

Again using Mr. Rabold’s $117,000 per teacher headcount. Three teacher overflow would come to $351,000. Interestingly, this is approximately the cost of interest avoided in his cash management example above.

End of the day, reasonable people can disagree, with that difference of opinions serving as a vehicle for finding common ground and better solutions.

Mr. Rabold points to lack of public participation in the annual budget process. My columns and letters before are participation, just not in the way he wants.

My articles are partially driven by reader comments in the blogs or other methods as I have heard from our readers by email (Neilsullivancpa@gmail.com), Facebook, Twitter, Instagram, LinkedIn, and even a note or two left in my mailbox.

Even though Mr. Rabold is right and we did move to Cresswind Springhaven in East Newnan a couple of weeks ago, I still plan on writing on school issues for not only Fayette, but also Coweta, Clayton, and our great local private schools such as Trinity, Landmark, Heritage, Central, and other schools.

I look forward to your continued interaction as we all seek ways to find great educational options for all of our area’s children.

[Neil Sullivan is a finance/accounting executive and CPA. He has lived in Peachtree City over 20 years with his wife Jennifer, a Fayette County History teacher and son Jackson, a student at Erskine College. He has been active in public school related issues in Fayette County, leading three E-SPLOST initiatives as chairman of Fayette Citizens for Children. He has appeared previously on these pages in letters to the editor.]

12 COMMENTS

  1. Hi Mom I hope you are well. We agree. I am diving on OpenGA to better understand these costs and growth over time. More to come in a few weeks.

    Sadlly, I not only built the cost cutting analysis at Delta Airport customer service but wound up the one deliver the news in several cases such as Portland, Islip, Reno, Fairbanks, San Jose… 9-11. Its hard when you look in the people’s faces and not just see numbers, but it was necessary for the company.

  2. Neil, I don’t want to drag you off topic, but you mentioned the new Booth middle school. What do you know about the old booth middle school that was just too dilapidated to refurbish and, oh wait, it’s still in use today. How many people are actually getting educated there now? What is the curriculum? Who owns the property and is it producing a positive revenue stream for Peachtree city or Fayette county?

  3. I hope we all agree that the State of Georgia has zero emphasis on public education and the financial support that goes towards ensuring success of students at the Pre-K to 12th Grade Level. Georgia has only fully funded public education 3 times since 2008. This leaves counties like Fayette holding the bag and forcing them to raise property taxes to continue to provide funding for public education. And Georgia has placed restrictions on local/county governments and their ability to raise property taxes beginning in 2025. It appears Georgia is slowly strangling public education.

    • And Georgia has placed restrictions on local/county governments and their ability to raise property taxes beginning in 2025. It appears Georgia is slowly strangling public education.

      This is my very biggest concern. Fayette has been dealing with this, but it is coming to other systems such as Clayton. We need a path forward.

    • The “fully funded” canard really gets old. So, the State didn’t provide 100% of some formula, that doesn’t equate to inadequate funding. Given how often we’re told how good Fayette County schools are, this complaint seems silly. “We have great schools and the State doesn’t provide enough money” seem like contradictory statements. And whether the funding comes from the State, County, City or Federal level isn’t particularly important. Allowing counties to decide how much they want to fund and how to run their schools allows people to live where they like these decisions and also allows people to try different approaches.

  4. Mr. Sullivan’s POV is very numbers driven and appears to attempt a distillation of FCBOE financial challenges to a spreadsheet driven decision making process. It doesn’t take in account the human element which, in the case of FCBOE, is very definitely focused on providing an optimal education experience for our children.

    For example, he states:

    “Personnel cost savings from outsourcing come from removing them from the generous state benefit plans that have cost growth much higher than revenue growth, is a way to save dollars that can be used in the classroom. After all, the “E” in FCBOE is for education, not employment. By choosing a more robust employment model, the choice is, no matter how well intentioned, to put employees before students. This is a question many employers and leaders struggle with.”

    Mr. Sullivan’s argument fails in three critical considerations:

    1. He is attempting to argue that cheaper employees will provide a better environment for our children. I’m concerned that anyone would think paying an employee less will somehow generate the same level of effort and attention to detail that is currently enjoyed.

    2. Outsourcing works best when the expense for a particular skill is spread across multiple companies in a shared expense model. The outsourced role still costs the same (to maintain a highly motivated employee) but is paid for by multiple companies that share the expense.

    3. We should absolutely want the best paid employees so that our children have the best experience. We don’t want highly skilled teachers impacted in their ability to teach by reducing the quality of the nutrition program or in minimal custodial services that saved money but detract from the learning environment. We place children first by placing great emphasis on the employees we hire to support the students.

    Mr. Sullivan demonstrates that outsourcing is a more complex conversation in his acknowledgement that APS recently insourced their nutrition program – while trying to argue that we could save money by outsourcing he also points out that outsourcing has failed – and therefore likely introduced added expense associated with reacquiring a skill set that was previously outsourced.

    The discussion around coaches I find to be inconsistent with the rest of the expense arguments – there is an attempt to make this into a simple numbers discussion when it is far from that. The FCBOE budget is like a ball of putty – you push on one side, and something is going to poke out on the other. It is naïve to pick out some specific examples and use them as exemplars when the FCBOE financial environment is so much more complex than we would like it to be.

    As a CPA, Mr. Sullivan must have experience with rising costs we are all experiencing. Well-run companies faced with rising costs find ways to generate additional revenues to offset the costs. FCBOE’s revenues come only through taxes and cutting costs to improve services isn’t a viable solution for revenue generating companies much less FCBOE.

    So, the unhappy fact is that costs have gone up and so must FCBOE’s revenues to maintain the level of education that we’ve come to expect in this county.

    • Hi Tracer I hope you are well. A spreadsheet approach is necessary when you only have x dollars to spend. My focus is getting as much classroom resources as possible. Teachers and parapros first.

      We agree on revenue. You probably have seen my other articles about changing where ESPLOST dollars go and how they can be used. I even covered how the BOE can ask the public for a millage rate higher than 20.

      You will see that I have stood on these pages and so many other places educating the public on why we needed ESPLOST to pay for our capital needs so we could pay for teachers.

    • “Well-run companies faced with rising costs find ways to generate additional revenues to offset the costs.” Or, they stop spending money they don’t have. Major firms like Intel, IBM and Cisco are in the midst of massive layoffs. Raising taxes is not the only solution to addressing budget constraints in our schools. I’m not suggesting we lay off teachers. Instead, we need to take an inventory of “support” personnel. I will ask you the same questions I posed to Mr. Rabold regarding the office of student achievement. How many directors, coordinators, and assistants are required to ensure teacher effectiveness? Do we really want or need a department of personnel providing professional development at tax payers’ expense? Wouldn’t our students be better served by having these central office educators as classroom teachers? Well run companies know that cutting costs is always a viable solution. The same is true for our public schools. Just say no to spending.

    • Tracer,
      Not true! If the average Fayette citizen knew the ins and outs of what FCBOE spent money on, I think most would conclude a lot can be cut without jeopardizing “the level of education that we’ve come to expect in this county.”

    • Sounds like the BOE admitted that we’re overpaying for custodial services. We could get the same service at lower cost, and we should. The proposal would provide some protection to current employees (which increases our costs but may be defensible as a transition/employee appreciation gesture). But in the private sector if you can get the same service at lower cost by outsourcing that’s a no-brainer.

      This isn’t necessarily a big deal, but it’s a red flag that opportunities to control costs are waved off.

      The fact that APS outsourced something and is now bringing it back in-house isn’t definitive. Who knows, in 2-3 years they may try outsourcing it again and it may be successful. We also don’t know the details about why they reversed this decision – it’s not uncommon for gov’ts to pull the plug on these arrangements even if they’re successful, they like having a really big empire to manage.

      • This isn’t necessarily a big deal, but it’s a red flag that opportunities to control costs are waved off.

        This is one of my points. Every dollar that can be saved can go to the classroom. I have often said my job is to scrape copper off pennies to make more pennies. (Note to secret service it is an analogy)