Planning for 2020-21 Budget Challenges

Preparing for the Economic Impact of the COVID-19 Crisis

The Board of Education and DPS staff have begun to look at what financial implications our district may face from the overall impact the COVID-19 crisis is having on our state and national economy.

At a DPS Board of Education meeting on Thursday, April 16, we shared what we know, what is still unknown and some projections on how the budget may be affected in the coming months. Our Finance team also shared a presentation outlining the financial state of the district as an overview of the current situation, along with initial thoughts about how the district may consider handling the financial impact of COVID-19.

Read the Financial Update Presented to the Board of Education on April 16, 2020 »

Crowdsourcing Budget Solutions

We welcome your suggestions for ways to address the budget challenges our district will face in the coming year. On this page, we’ll share all the ideas we receive from the DPS community, as well as some notes from our Finance team on some of the most frequently suggested categories.

The BAC would like to invite our entire community to submit written feedback as public comment for the committee to review during its upcoming meetings on May 15 and 22. Submit your written public comment via our online form.

Ideas for Compensation Adjustments

Suggestion Financial Impact DPS Comments
0% COLA (Cost-of-living adjustments) $12M 0% COLA for all DPS employees
Freeze DPS Step and Grade $11M Freeze DCTA step and grade progression for 1 year, requires DCTA union negotiations
1% Pay Reduction for Non-School employees $2M Beginning in FY 20-21
1% pay reduction for all employees $6M Beginning in FY 20-21; requires all union negotiations
Mandating utilization of Paid-Time Off (PTO) Variable DPS is reviewing potential impacts of mandating PTO usage
Delay low-wage increases $1.5M Delaying low-wage worker increases until January ’21
Reduction of one-time incentives (non-ProComp) Variable Certain incentives such as PDU’s were eliminated in FY20, very minimal impact would be realized from reduction of additional non-ProComp related incentives
Reduce Health Benefit Credits for employees not enrolled in DPS benefits $6M to $8M Eliminates benefit credits paid to “grandfathered” employees who joined the district before July 2018 who are not enrolled in a DPS benefit plan. All new employees who do not enroll in DPS benefits do not receive a Health Benefit Credit. Would be an annual reduction of $5,064 for eligible DCTA members. Total savings amount variable depending on how many grandfathered employees enroll in DPS benefits.

Ideas for Work Year Adjustments

Suggestion Financial Impact DPS Comments
Furlough day $4M per day Assumes all DPS employees participate
Work Year reduction for year-round employees Variable Variable impact depending on the employee groups eligible to reduce to 215-day work year

Ideas for Department Organizational Structure Adjustments

Suggestion Financial Impact DPS Comments
Reorganization or reduction of central departments Variable DPS continually evaluates the impact that every department has on ensuring the highest level of student success. The organizational structure of all programs and departments, including but not limited to SPF, AR&D, LEAP, LEAD, Academic Coaches, CELT, Portfolio and Communications will continue to be reviewed by district leadership to address the needs of the district and the impact on students.
Implement a hiring freeze Up to $2M DPS has already implemented a hiring freeze for all non-school employee positions
Reduce funding for leadership development (RELAY) $380K DPS reduced the majority of RELAY expenses in FY19-20
Reduce frequency of curriculum changes and purchases Up to $5.5M Reduced purchasing of student kits & notebooks for FY20-21
Reduction to Career and College Success Department $330K Reducing non-salary expenditures

Ideas for School Operational Adjustments

Suggestion Financial Impact DPS Comments
Convert to a 4-day school week or implement remote learning days Variable Variable impact depending on associated change or lack of change to school employee work years or daily hours. Savings could potentially be realized through reduced building operation expenses.
Convert to year-round school year $0 Increases expenditures with increased cost of staffing for school-based employees and higher building operating expenditures. Currently, enrollment is forecasted to remain flat and potentially decline, reducing need for additional building capacity.
Increased class sizes Variable Results in reduction of teacher staff and potential negative impacts to student success, with variable impact depending on the number of classes combined.
Reduce school administration and instructional leaders Variable Variable depending on individual schools current administration staffing and evaluation of school needs
Eliminate SPF Framework Allocations to Schools Up to $2.2M Eliminate SPF Framework and shift to CDE SPF, reduces $2.2M in funding to schools for performance
Implement a unified READ Assessment across all schools Variable Variable depending on cost of universal assessment vs. current school-chosen assessment program
Eliminate Standardized Testing Up to $750K Would require legislative action from the Colorado Department of Education. DPS is currently researching central expenditures for oversight and training for administering standardized testing
Fully reduced or limited sports activities & excursions Up to $5M Variable depending on timing of resuming sports activities

Ideas for School Mergers

Suggestion Financial Impact DPS Comments
School mergers $500K per school Combining school locations to reduce administrative and building operation expenses. Variable impact depending on enrollment and number of schools merged.

Ideas for Charter Schools

Suggestion Financial Impact DPS Comments
Convert all charter schools into district-run schools $0 Would not reduce costs as the district would absorb all revenues and expenditures currently allocated to charter schools, also currently not legal under State provisions
Reduce allocation to charter schools $0 State law dictates how charter schools are funded by school districts. Any reduction in funding to districts results in a similar reduction to charter schools, creating similar budget adjustments and expense reductions.
Increase Charter Administration Fee $0 State law dictates how Charter Schools can be charged administration fees. DPS charges administrative fees based on actual administrative expenditures, which has traditionally been around 3%-4% of PPR. While the state limit is 5%, DPS would not be able to increase this amount without increasing central administrative expenditures.

Ideas for Operational Efficiencies

Suggestion Financial Impact DPS Comments
Bell-time adjustments Up to $4M DPS is currently reviewing options regarding eligible schools and associated impact to making these adjustments.
Central administrative building consolidation Variable DPS is currently reviewing options regarding costs of leases, property values, and other impacts of consolidating administrative buildings with increased remote work from central admin staff.
Eliminate Transportation for all non-SPED students $8M to $15M DPS is currently reviewing options regarding reducing transportation services to non-SPED students, researching the potential savings of variable vs. fixed costs associated with current routes.

Usage of Reserves

Suggestion Financial Impact DPS Comments
One-time usage of district reserves Up to $34M One-time usage will not solve ongoing budget shortfalls beyond FY21, and has the potential to negatively impact DPS’ credit rating for future bond and debt issuances.
Realign school carry-forward policy Variable Adjustments to the carry-forward policy will have varying impacts on schools.

Ideas for PERA Adjustments

Suggestion Financial Impact DPS Comments
Delay PERA .5% auto-adjust contribution increase $3.5M Requires legislative action from the State and PERA
Provide early retirement incentives for PERA Variable DPS is currently evaluating the potential one-time expense vs. long-term savings to offer early retirement to eligible employees.

Ideas for Additional Revenue

Suggestion Financial Impact DPS Comments
2020 Mill Levy override $10M for current expenditure backfill, any additional to be invested into new programs Requires voter-approved passage of a 2020 Mill Levy override.
CARES Act and additional COVID-19 support from government Variable Funding from CARES Act expected, currently reviewing details and submission process to receive funds.
Shift General Fund capital expenditures to 2020 Bond $3.7M Requires voter-approved passage of a 2020 Bond.
Receive Sponsorships Variable Potential sponsors suggested include Denver professional sports teams and educational corporations such as Scholastic, McGraw Hill, etc. Revenue dependent on participation and awards.
Modify Amendment 64 to allow for Operational School Funding Variable Allow funding currently directed to the BEST Program currently restricted to capital funding for schools to be allowed for operations expenditures. Requires legislative action from the State of Colorado.
Charge Tuition for Half-Day Kindergarten for Non-FRL students up to $5M Currently not legal after funding implementation for Full-Day Kindergarten, requires legislative action.

Other Miscellaneous Adjustment Ideas

Suggestion Financial Impact DPS Comments
Review and reduce third-party contracts Variable DPS is currently reviewing opportunities to reduce third party contracts.
Reduce spending on supplies Variable DPS is currently reviewing the impact of reducing supplies including paper, food, mailings and office equipment.
Reduce spending on travel Up to $1M Does not reduce travel for students
Reduce spending on software and hardware for administration Variable DPS is currently moving to the Google platform, which will reduce individual department software expenditures. Reductions in hardware and equipment will have a minimal impact based on current DPS hardware replacement policies.
Eliminate mileage reimbursement expenses Up to $300K Reducing mileage reimbursements for all schools and departments.
Reinstate collection of Food Service lunch debt Variable up to $260K Reverse current practice of not collecting outstanding student debt for meals.

About the Budget Advisory Committee

In support of the budget development process for the 2020-21 school year, the DPS Board of Education has convened a Budget Advisory Committee (BAC) that will provide input into the board’s deliberations. The BAC will function as an advisory committee to the board, providing community and staff perspective around budget topics that will lead to recommendations to the board. The board has final decision making responsibility for the annual district budget and provides guidance on how DPS staff implement the budget.

What will the BAC produce?

In order to accomplish its purpose, the BAC will prepare a final report for the Board of Education that will present three tiers of options to address the budget gap.

Tier 1: Options with widespread support that the committee recommends be included in the 2020-21 budget.

Tier 2: Options with some support, but also with questions or dissenting opinions, that should be considered for inclusion in the 2020-21 budget if necessary, but only after exhausting the options from Tier 1.

Tier 3: Options with little support, which should only be considered after all other Tiers have been exhausted.

Options will be prioritized within the tiers, and comments will be provided on different options, so that if the budget picture improves or worsens, the Board of Education can take appropriate action to include or remove options from the budget.

Committee Composition

The committee is composed of the following individuals, who were nominated and selected by their respective organizations/entities:

  • Three members of the Board of Education
  • Five community members (two students, one recent DPS alum and two parents) selected by the Board of Education
  • One staff member who is not part of a collective bargaining unit
  • One staff member who is part of a bargaining unit
  • One teacher (nominated by DCTA)
  • One principal representative (The superintendent will submit three to five principals for the Board of Education to deliberate on)
  • A representative of the District Accountability Committee
  • Members of the DPS Finance team

Committee Membership

Name

Role

School/Regional Affiliation

Jennifer Bacon Board of Education District 4
Scott Baldermann Board of Education District 1
Angela Cobian Board of Education, Co-chair of Budget Advisory Committee District 2
Alise Kermisch District Advisory Committee member, Co-chair of Budget Advisory Committee, DPS Parent Steck
Matthew Annan Student KIPP NE Denver Leadership Academy
Andrew Schwartz Student George Washington High School
Carlos Cantor Young DPS Alum Godsman, Morey Middle School, Kunsmiller
Manuel Aragon DPS Parent Colfax Elementary, Lake Middle School
Christy Lee DPS Parent Bromwell
Bobby Thomas Principal South High School
Tiffany Gardner DPS Senior Program Initiatives Manager, Equity and Engagement Emily Griffith Campus
Lynne Valencia Teacher Thomas Jefferson High School
Tracy Young Manager, Food Service Lake Middle School
Chuck Carpenter Executive Director of Finance, DPS Parent Emily Griffith Campus, William Roberts ECE-8
Jim Carpenter Chief Financial Officer Emily Griffith Campus
Mark Ferrandino Deputy Superintendent of Operations, DPS Parent Emily Griffith Campus, DCIS Fairmont