The school board approved Tuesday night a plan that moves $17.6 million from its budget to fund an increase in employee pay.
The plan, which was approved on a nonunanimous voice vote, was reached after hours of debate on Tuesday.
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Board members agreed to $15.2 million in cuts Tuesday afternoon but spent the better part of their budget and finance committee meeting debating how much to cut from a proposed increase in the local teacher salary supplement, a fund for some low-performing schools, and the fund for school supplies and materials.
Ultimately, the board decided to keep the $500,000 for school supplies and materials that was initially proposed for a cut by district leaders. The board still opted to move forward with a proposed $500,000 cut to a fund for some low-performing schools, known as Restart schools, and to reverse its initial plan to spend $1.9 million on a 1% increase to the local teacher salary supplement.
"I never want to take away from classrooms," Board Member Cheryl Caulfield said. "That's my concern with this."
Wake County school leaders needed to find $17.6 million in spending to cover higher-than-expected employee raises, essentially cutting $17.6 million from its other operations but not reducing the budget overall.
The new state budget raises pay for teachers by an average of 8%, with less experienced teachers getting a bigger pay bump and more experienced teachers getting a 5% pay bump. But the district has nearly 2,000 locally funded teachers whose salaries now need to match the state's pay. The $17.6 million budget hole is mostly to raise educator pay or match bonuses the state will provide to state-funded employees. About half a million dollars would go toward accompanying benefit cost increases.
All of the cuts agreed to Tuesday amount to $17.6 million.
Just five of the board's members were in agreement on the plan during committee, with three agreeing to keep some portion of the salary supplement instead, and one board member wanting to keep the funds for the low-performing schools.
"We're kind of double-dipping into that same pool, which is not something I would agree to," Board Member Wing Ng said of the proposal to slash Restart funding. "The impact on students seems to be concentrated on a certain subpopulation versus the other items seem to impact everybody kind of all across the board."
The Restart fund up for debate Tuesday is a pool that about 40 Restart schools can draw from, with approval from their area superintendents. The money isn't automatically given to any schools.
"We're not taking something back from the school," said Terri Kimzey, the district's senior budget director.
The extra fund for Restart schools had $6 million in it last year. About $400,000 of it went unused. So district leaders recommended cutting from that fund last spring, and the board agreed to cut $160,000 in the budget proposal they approved this spring. The $500,000 proposed on top of that this month would bring the fund down to $5.34 million -- an amount less than what was spent from it last year.
The $3.22 for about 160,000 students' supplies and materials is just about $500,000. District officials said about $800,000 from that fund went unused last year, so the cut would still keep the total funding for supplies and materials above what was spent last year.
How much Wake teachers could be paid and when
Some board members noted they'd received feedback from the community asking them to keep the proposed 1% increase to the local teacher salary supplement, but some also noted the 1% increase wouldn't have amounted to more than about $140 in a year for the most experienced teachers. Keeping some of that supplement and concentrating it just on the most veteran teachers wouldn't have amount to much more than that.
"It would be almost not noticeable, and it would be less noticeable if they had to spend more out of their own pockets" on supplies, Board Member Jennifer Job said.
Also Tuesday night, the board voted to adjust the teacher salary schedule to incorporate the new state raises. That boosts first-year pay to about $55,000 and 30-year pay to about $73,000.
Those amounts are still less than what teachers earn in school districts in metropolitan areas with similar costs of living, a WRAL analysis previously found.
Those increases will be reflected in September paychecks, which will also include any back pay for time worked this school year without the raises. Bonuses will be paid out in October.
The bonuses vary based on experience level and are based on retention by a certain date, Oct. 1. For more experienced teachers, they'd receive $1,000. For less experienced teachers, they'd receive $500.
Other school employees will get bonuses of no more than $1,750 based on current pay. Those employees also have lower average annual raises of about 3%, the amount the Wake school board already budgeted for.
How Wake is adjusting its budget
The Wake County Public School System didn't think it would have to cut $17.6 million in actual operations, however.
The district has already learned what its federal and state allotments --- per-student funding amounts for specific federal and state programs --- will be for this year, and they're coming in higher than the district budgeted for.
Those higher-than-expected allotments would save $4.7 million, which the board agreed to.
While federal and state funding for students with disabilities and other student categories is earmarked only for those purposes, the county spends its own money on those students as well. So, higher-than-expected funding for those student categories allows the district to shift that money to cover what county funds are currently paying for, freeing up county funds to be spent on other things.
The district also thinks it can spend about $3 million less on substitute teachers and charter schools than in the previous year. The board agreed with that.
The district's fund balance from prior years would be the largest source of funding adjustments, about $5 million. The board agreed with that, too, though some wondered if more money could be moved from the fund balance.
To save another $1.9 million, the district recommended that the school board reverse its decision to increase the local salary supplement by 1%. The supplement, instead, would stay the same as it is now. After considerable debate, the board agreed with that, too.
The 1% increase would have provided only between $73 and $144 additional dollars to many teachers. That's an amount that district leaders don't think will serve to make the district more competitive in hiring compared to other nearby North Carolina districts.
Another recommendation from the district is to reduce the extra funding it provides to some low-performing schools by half a million dollars. The board is moving forward with that recommendation.
Other cuts include $200,000 for mulch, $400,000 from a lease, and $500,000 from the central office.
The district's operating budget is more than $2.2 billion dollars, meaning the latest potential adjustments, coupled with the adjustments from this spring, represent about 1% of the budget.
Leaders predict more cuts to come
The Wake school system's issues mirror challenges faced by school districts across the state and nationally, as they deal with dropping or flattening enrollment that automatically triggers changes to per-student funding provided by states and the federal government. Because enrollment decreases may not be significant enough at a school or classroom level, declining enrollment can lead to less funding but still require the same amount in costs.
The school district is already bracing the board for more cuts for the 2027-28 school year. Those cuts may be needed for a variety of reasons, including stagnant enrollment leading to flat revenues amid rising costs. Leaders also expect limited county revenue, plan to add spending to open a new high school and natural costs increases to Medicaid, benefits and other operations. The district is also expecting to run out of a federal special education grant.
"If people think this is bad just wait until next year," Board Vice Chairman Sam Hershey said.
The district doesn't have a lot in savings to work with, after using some fund balance to pay for its recent budgets.
To afford the raises Tuesday, the board had to waive its policy that states it won't use more than half of its fund balance in a year. The budget the school board previously recommended but never passed, proposed spending half of the $37 million fund balance. The addition of $5 million Tuesday to avoid further budget cuts put that fund balance amount at $23.5 million, or 63.5%.