The Joy of Stabilizing General Fund Reserves

We now know that closing an elementary school saves the Cedar Rapids School District anywhere from $600,000 to $757,000 annually. So under one option being considered, closing Harrison, Polk and Monroe, would save just more than $2 million. A second option, which substitutes Madison for Harrison, saves just less than $2 million.

The numbers are estimates, that do not include, for example, any potential transportation costs that might be incurred busing kids to schools outside their neighborhoods. And nearly all of the savings come from eliminating building-specific jobs - principals, secretaries, counselors, instructional coaches, media specialists, health secretaries, custodians, paraprofessionals and lunch staff. Between 11 and roughly 14 full time equivalent slots would be sliced at each school closed.

Sacrifices would be made, to be sure.  Lives would be disrupted, especially kids and parents. The value of those changes is tougher to calculate.

And on Monday, some of those folks heard how the district would use the financial fruits of that sacrifice. The vast majority of any savings realized, according to district business services director Steve Graham, would be used to (drumroll) "stabilize general fund reserves." The money would basically go into savings.

The district currently has $22 million in its general fund reserves, or about 13 percent of its $183 million general fund budget. Graham said the state's decision to offer no increase in state per-pupil aid, along with declining enrollment, has forced the district to dip into its reserves in recent years. Costs also are rising, with wage and benefits, he said, leading the way. Closing schools would allow the district to rebuild its savings and hedge against future budget issues.

I'm not suggesting that reserves aren't important. They clearly are, although it is worth noting that it's up to the district to set the size of its reserve. There's no law that says it has to be 13 or 12 or 20 percent. But Graham says 13 percent is pretty comparable to other districts.

Still, what a bitter pill to swallow for parents, neighborhood leaders and others agonizing over the fate of their schools. Closing schools isn't the first stop on a painful but hopeful path to ambitious improvements and a more robust educational experience for their kids. It's another patch on a leaky budget, struggling to cover the cost of the status quo.

Speaking of reserves and status quo, the state has more than $400 million in its reserves and is projected to end the current fiscal year with an unspent balance of over $300 million. And yet, Statehouse types couldn't find the dollars to provide even a modest inflationary boost to school aid. So schools across Iowa are in this same boat.

Gov. Terry Branstad insists on putting schools on a crash budgetary diet while he, education chief Jason Glass and lawmakers cook up a feast of ambitious reforms to transform Iowa schools.

I am still very hopeful about the future of that reform, and that something real and meaningful will emerge from our gold-domed sausage factory.

But here in Cedar Rapids, folks may soon be watching their neighborhood schools transformed into dark, empty real estate listings in need of unloading. Those schools will never get to be what Branstad calls  "world class." There are lofty Capitol calculations and strategies, and then there are the realities on the ground. They so rarely look the same.