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DISTRICT OF COLUMBIA PUBLIC SCHOOLS Office
of the Chief Executive Officer 14 April 1998 Dr. Andrew Brimmer Dear Dr Brimmer: As I mentioned to you earlier today, when I joined the Authority as the CEO/Superintendent/Trustee/State Education Officer in November 1996, I had little experience as a K-12 educator. I did, however, have my integrity and a life time of credibility. Since I have been a member of the team, I have basically suffered the "slings and arrows" from many corners, but have been basically supported by the Authority. Last week all of that changed. My integrity was challenged by a member of the Authority in the media and, to the best of my knowledge, no fellow Authority member uttered a word in my defense. Of course I am talking about the Washington Post article that I "failed to deliver on a promise to dismiss 440 workers last year in exchange for pay raises for teachers". I never made (or even considered) such a quid pro quo. That statement is completely false. This debate is no longer about children. It's about power politics. While the above is so typical of this city, there is a deeper malady. While I had declared that our teachers deserved a pay raise from the very beginning of my administration, we submitted our Budget Request for FY 1998 to the Mayor on January 15, 1997. That request was for a total of $525.843 million in local funds. That calculated out to be approximately $389 million needed to support 8,623 FTEs . The FY98 request included a reduction of 440 FTE from the FY97 authorized level of 9063 FTEs. As you know, the Authority, the Mayor and the City Council reduced our Recommended Budget to a total local funds budget of some $460 million, a reduction of $65 million. That translated into a Personnel Services (PS) budget of approximately $348 million to support the total requested FTEs of 8623,, as well as the 5% pay raise for all principals and teachers. Hindsight being always better, it is clear now that PS funding included in the approved budget was not sufficient to support the approved level of 8,623 FTEs inclusive of the pay increase. The city's budgeters support our contention that the approval of incongruent FTE and PS funding levels resulted from the erroneous assumption that the FY97 PS, budget of $373 million supported the full complement of the authorized 9063 FTEs. The fact is however that we had achieved significant FTE reductions during FY97. We even transferred almost ten million dollars from the PS budget to the OTPS budget to take care of unprogrammed and unbudgeted special education transportation matters. At the end of FY97 only 8712 of the authorized 9063 FTEs were in the system. In effect, we were within 89 FTEs (approximately $3.9 million) from the FY97 base. (See enclosure 1 ) The assumption that our FY97 base PS budget supported the full complement of authorized FTEs, resulted in greatly overstating the savings from reducing to 8623 FTEs. Only $3.9 million versus the $13 million calculated in developing the adjusted base budget would be saved from reducing FTEs to the FY98 authorized level. In other words, $9.1 million in savings could not be realized by DCPS. The full $13 million was erroneously removed from our budget because we had already reduced FTEs in FY97. The base assumption used in determining our FY98 budget was flawed and we were doomed to overspend, even within the authorized FTE level. There is a rhetorical question which might be asked at this point, where was the city CFO during this activity? The irony is that by using an average salary of $44,000, our authorized FTE level should have been 7913 based on the approved FY98 budget. This means that our authorized FTE level included approximately 700 FTEs that were not funded, which translates into approximately $30 million in overspending. Therefore, the FY98 budget assumed $9.1 million in savings that could not be achieved and authorized $30 million worth of FTEs that were in excess of approved funding. Our first expenditure report was not completed until January 1998 (four months after the beginning of the FY). Prior to the completion of the first expenditure report, our officials were using FTE numbers to monitor the PS budget. Due to the fact that the FTEs on-board were not significantly more than the authorized level (and it was still early enough to mandate personnel reductions), it was assumed that the PS budget was not in jeopardy of being overspent. Simply stated, we assumed the approved budget provided enough funding to support the full contingent of authorized FTEs. As more expenditure data became available, our people realized that the PS budget was heading for a severe deficit even though the FTE numbers had appeared reasonable for the first half of the FY were asleep at the switch because a thorough analysis of the methodology used to cut the budget brought to light the real reason why our system's overspending is so significant. Clearly, a flawed PS budget, in part, led to this crisis. I am prepared to accept my share of the blame, but it is clear that there is enough to go around. Those parties to the consensus budget also contributed to our problem. It would be "nice" if just once, those who contributed to the DCPS situation, acknowledged their involvement. I have had it! 30 April will be my last official day of duty as the CEO. Sincerely, JW Becton Jr Enclosure cc: Members, DC FRMAA Incl 1The approved budget was determined by taking the following actions on the FY97 base:
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