District Backs Off PTSA Fee

(Update: The Times weighed in and with a lot of skepticism over this idea. To whit:

District leaders must develop a better ear for what works and is acceptable to city families. Floating a ridiculous idea only to pull it back amid an uproar weakens the district's already fragile bond with families. Parents cannot help but wonder what other ideas at central administration are awaiting their ride up the flagpole.

Yes indeed, what next?)

Thanks to a parent and activist, Kellie LaRue, for this update: the district is not going to charge a fee to cover administrative costs to PTSAs for funds raised for school budgets. (I will name this person after I find out if it is okay. Thanks to all of you who contacted the Superintendent, the Board and for offering to take public action on this issue.

Here is what they had to say via Bridgett Chandler, Executive Director of SPS Communications:

We want to express our sincere appreciation for the hard work and dedication of our PTSAs. Their support is absolutely vital in our efforts to make every school an excellent school. We regret that our PTSAs were caught by surprise by one of the proposed strategies to balance the budget. We are evaluating many potential ways to address the budget shortfall, and it is clear that the idea of extending the policy of charging an indirect grant fee to include PTSA grants is not a productive suggestion. We acknowledge that we should have reached out directly to discuss a prospect like this with our PTSAs. Improving our communication to families in general and PTSAs in particular is a high priority during our ongoing budget development process.

SPS staff recommended this fee recently as part of an overall effort to both improve district-wide financial management and to address the impacts of a $3 billion state budget shortfall. The district proposed extending the practice of charging a grant administration fee for ALL of the grants it receives, including PTSAs. It is typical for organizations to charge some level of fee – known as an indirect fee –to cover the actual costs associated with receiving grants and paying for the services the grant supports. For instance, if a grant covers a part time music teacher, that person needs to be hired, added to payroll, granted an email account, etc. Indirect fees on grants pay part of the costs of these payroll, hiring, finance, and information technology services. This type of indirect rate charged by local government and educational organizations varies widely; some entities charge up to a third or even half of the grant amount to cover administration and other costs associated with a grant.

It is the district’s current policy to charge an indirect fee on grants, but it currently exempts PTSA grants from this fee. We proposed covering part of the costs of administering these grants through a 3.3 percent rate, which is the rate we currently charge for federal grants we receive. Staff briefed the School Board’s finance and audit committee recently about an array of potential budget cuts and strategies to reach a balanced budget. This proposal was also included in the budget information that we share with principals and other district leaders. In hindsight, we should have highlighted this particular recommendation for broader discussion.

The reality is that the work of administering these grants needs to be done, and we will look elsewhere for cuts to offset the amount that an indirect fee would have produced. On top of cuts made last year, we’ve just eliminated nearly 90 more central office positions. This represents over $6.2 million of the needed $24 million in cuts required to address this year’s budget shortfall. The process of informing our many dedicated staff about central office reductions of this severity demanded careful attention. We are now turning our attention to completing the budget. We are committed to improving our budget development process, especially in supporting our school leaders as they work with staff, families, and valuable partners like our PTSAs as they prepare their school budgets.

We are offering engagement opportunities for our community after spring break so that we can share updated information once a final state budget is released. This will also be an opportunity for us to hear from families about improving the budget development process and learning what their top priorities are as we prepare to address yet another anticipated state budget short fall next year of approximately $26 million. Our commitment is continue to protect the instructional core to the greatest extent possible.