District battles budget woes while looking for new chief

For more than a decade, Richland 2 schools have enjoyed tremendous growth, launching innovative academic and technology programs that have earned state and national recognition.

But today, the Midlands' largest school district is facing some of the toughest economic decisions in its history.

And, for the first time in 16 years, Richland 2 will tackle those issues with a new leader at the helm of the 24,000-student district.

Superintendent Steve Hefner, who has garnered respect for leading the district with strong vision and a steady hand, is retiring in May. Three candidates for the job are expected to be announced next month, with a final decision expected in April.

Still, there is anxiety among leaders and staff members about whether the district and its new chief will be able to maintain the district's storied momentum, given economic conditions.

Bob Davis, the district's chief financial officer, has characterized the downturn as the worst he has weathered in 12 years on the job.

Already, the district has left some positions open, as well as scaled back on out-of-town travel and staff development.

What Davis worries about now are the continuing ripples of recession - including the end of the federal stimulus money in 2011 that saved jobs and programs, as well as the prospect of diminished state and local tax receipts that pay for schools.

"I see it as a challenge," Davis said. "This year the federal stimulus was $7.2 million. Next year it drops to $4.6 million. The following year it goes away."

Federal stimulus money was a boon to this urban/suburban district, which up to now has cushioned financial downturns by what Hefner called "trimming the sails" and maintaining a financial reserve.

Some districts without that cushion had to cut close to the bone, laying off teachers and eliminating programs.

Davis said he believes the district can "sit tight" a while longer because of targeted cuts that have not significantly affected the classroom.

But the district's prized teacher-pupil ratio - among the lowest in the state, at 20-to-1- may be in jeopardy.

Davis also worries that the employee benefits package - which he said is better than the state's - may have to be pared back.

Still, no final decisions have been made about next year's budget.

"I think there is heightened anxiety," Davis said. "I trust there is not fear. Anxiety is OK; a little bit of that is healthy."

Likely the top concern of the new Richland 2 chief will be this: Nearly 15 years of gains in base student cost - the amount of money spent to educate each child - have been erased because of the economic downturn.

The district is now back to 1996-97 levels.

"That is pretty dramatic," said Daniel Domenech, executive director of the American Association of School Administrators. Typically, he said, districts nationwide are reporting a return to levels of about four or five years past.

If there is consolation, Domenech said, it is that districts nationwide are in the same boat, as states and localities tally declining income and sales tax revenues and real estate taxes.

"As tough as things were this year," Domenech said, "next year will be tougher, and the real fear is that the following year will be the toughest of all."

Les Sternberg, dean of USC's College of Education, said there is palpable concern among school administrators about the fiscal and psychic toll the economic downturn has taken on districts, although some of that was unspoken.

"I think the strategy was not to show any hurt," Sternberg said. "But at some point, it's impossible. Something has got to give."

Like Davis, Sternberg advocates "strategic focus" as districts such as Richland 2 ponder the possibility of more reductions by the state Board of Economic Advisors.

That's what the board intends to do, said Dan Neal, vice chairman of the school board.

"I think we need to be looking out five years," Neal said. "If you look at what the federal and state government say, they really see it as a four- or five-year problem. Anything we can put aside from stimulus funds in reserves to get us through that longer period is going to be necessary."

Still, Neal said, there are programs he would fight to save, including the magnet and choice programs and the financial incentives the district now pays, above the state incentives, to teachers who achieve their National Board certification.

Pupil-teacher ratio will undoubtedly be on the table, he said.

"If we are at 20-1 now, and we increase it to 21 or 22, we can probably live with that," he said. "But if we get to 25 or 26, there will be a huge outcry, and righteously so."

Richland 2 board member Stephanie Burgess said the selection of a new superintendent will bring change and some anxiety, but she said the board has no intention of lowering expectations for the new chief, even with economic challenges ahead.

"Expectations will not be lowered in any way. They may be different."

She said new programs won't be implemented as quickly and there will be heightened efforts to make sure every staff position counts.

Still, she said she wants the district to remain "creative, savvy and culturally sensitive" in responding to growth and academics.