Joe's Commentaries
"The Wall" by Joe Smith - Good Morning - April 10, 2008
By Joe Smith
Apr 10, 2008, 08:45

Thanks for all the great emails relating to the “Protecting the Fund Balance” articles.  Some people have chided me for promoting rollback elections.  That is not my intent. 

My motivation comes from the experiences I have had with school districts experiencing unexpected periods of financial instability.  The financial foundation of a district is what supports all academic programs and student services.  An unexpected financial crisis impacts every aspect of a school district, an experience I don’t want anyone to go through.  Planning can change the outcome and prevent this calamity.  School districts that have identified and communicated the financial path of their school district can take actions that will avoid a crisis that some of you have labeled “The Wall”.  The point where operating expenditures exceed revenue is “The Wall”.  Those not planning ahead will hit "The Wall" at full throttle - not a pretty site.  My motivation for this discussion is for every school district to plan well, be aware and use the available resources to avoid “The Wall”.  I don’t want anyone to say I did not see it coming or no one told me.  Seeing "The Wall" allows a rational response that insures the continued success of your school district.  I do believe there is a wall ahead and each district should spend time identifying how far it is to their wall and how they are going to avoid it.

The emails I have received are encouraging; many of you are making plans.  I personally suggest using Omar’s “8  Step Path to Enlightenment” and expenditure projections as the basis for identifying when you may encounter “The Wall”. 

One superintendent has modified this Region 13 tool to compare expenditures using a 3.5% inflation factor creating a chart.   Others have prepared charts that resemble the old “alligator chart”.  The chart below is from Mike Pate at Warren ISD.  He said if you would like a copy send him an email (Pate@warrenisd.net ).

A template with a graph like this will allow you to identify the point in time when you need to have an election.  Since election outcomes cannot be a sure thing, I do encourage you not to wait too long.  When you start using the fund balance for operating, it is similar to a snowballing effect.  Plan well.  - js-webmaster@texasisd.com