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CMSD moves ahead with student-based budgeting, adds funds

CMSD will move ahead with plans to give individual schools more control over their budgets but will provide additional money to smooth the transition, Chief Executive Officer Eric Gordon said Wednesday.
Student-based budgeting will provide schools with increased autonomy, as called for by The Cleveland Plan, the District’s state-approved blueprint for reform. Principals and their teams will have authority over about half of their funds, with money allocated per student based on students’ specific needs.

Preliminary District planning estimated that the portion controlled by the schools as a group would be reduced by $21 million from current levels. Two-thirds of that amount was attributed directly to declining enrollment.

Last month, amid concerns about the impact on schools, Gordon announced that budgeting would temporarily be placed on hold.

He said at the time that the District would search for additional savings or revenue to soften the impact. He also asked a team of principals and central office representatives to review and possibly recommend adjustments in the funding formula.

Schools facing losses will receive an additional $14.9 million, the CEO said. The figure is based on projections of property tax revenue coming in $4 million to $5 million higher than expected because of new construction and $10 million to $11 million in savings this year on items like health care, unfilled positions and substitute staff.

“Throughout the process, we have remained steadfast in our belief that principals and their teams should be empowered to make decisions about how to best use resources allocated to their schools,” Gordon said. “We have taken to heart legitimate concerns about the potential impacts to students at the very time we are asking them to accelerate academic gains.”

The schools will now receive an average of more than $8,200 per student. Collectively, the schools will determine how to spend more than $282 million that in the past would have been left to the discretion of the central office.
The adjustments were made partly to buffer Investment Schools -- struggling schools targeted for customized turnaround strategies under The Cleveland Plan -- schools facing extremely large losses, small schools and the unique models employed by specialty schools.
Gordon said he also was mindful of the investment that voters made in 2012 when they approved the District’s first property-tax increase in 16 years.

“Voters who passed Issue 107 made it clear they were investing in CMSD to help us operate differently than we have in the past and produce results,” he said. “Budget shortfalls require us to to deal with declining enrollment and the loss of revenue that comes with it. And our promise to the community and to the children of Cleveland demands that we work together to mitigate any negative impact those cuts might have on our students.”

But Gordon said the District needs to address declining enrollment and develop a long-term strategy for sustainability. He said schools can help by attracting and retaining students.

School budgets will be incorporated into an overall budget that the Board of Education will vote on in June.