A Baltimore County school board request to use $50 million in surplus funds for teacher and staff pay raises is on shaky ground after County Executive Johnny Olszewski Jr. said the request was fiscally irresponsible and would cost taxpayers a half-billion dollars over five years.
The board of education on Tuesday voted unanimously to ask Olszewski, a Democrat, to use millions of leftover funds to raise salaries for teachers, administrators, bus drivers and other school employees. The money would cover raises for just one year, and the school system would need to scrounge up millions more within its existing budget to sustain the higher pay in subsequent years without added cost to taxpayers.
The vote was a rare display of unity by school board members, who have engaged in highly personal clashes over an array of issues, and as the board faces a near-total makeover this fall due to board elections and the terms of appointed members expiring. Lisa Mack, one of the board members, resigned Thursday due to serious health issues.
Olszewski said in an interview that he intends to use roughly $14 million of the school board’s request to fund a full year cost-of-living adjustment for school employees that would take effect immediately. The budget approved by the County Council in May funded a 3% midyear cost of living increase.
When the county executive spoke with school board members recently, he said he asked them how they planned to sustain the higher salaries in the coming years.
“That’s a good question,” Olszewski recalled one board member replying.
“No one has been able to articulate how this” would work moving forward, Olszewski said.
Meanwhile, the school district is grappling with fewer bus drivers and 550 teacher vacancies as of July. Last year, Cindy Sexton, president of the teachers’ union, said more than 1,000 teachers had departed.
“If the County Council does not approve this, I fear we’re going to lose more educators,” Sexton said Thursday.
County officials countered that using surplus funds to make teacher pay more competitive with other school districts wasn’t prudent.
Olszewski and two Democratic members of the County Council said approving the request to pay for operational costs would necessitate tax hikes and undermine the county’s firm fiscal footing by ballooning expenses — upwards of $159 million annually by 2027, the county estimates.
A former public school teacher, Olszewski said he “fully supports the contracts that have been negotiated, but it would be fiscally irresponsible to rely on a fund balance, a one-time source of revenue, to pay for significant” changes to the schools’ operating budget.
The school board wants to use the surplus to pay for contracts negotiated with TABCO, Education Support Professionals of Baltimore County, the Council of Administrators and Supervisory Employees, the Organization of Professional Employees and the American Federation of State, County and Municipal Employees.
“Our children need qualified teachers, administrators, staff throughout the system; and we know that there have been our sister districts that have made increases,” board member Kathleen Causey said Tuesday.
“It is absolutely urgent that we do this,” she said.
The contracts are contingent on available funding, Sexton said. If the transfer doesn’t move forward and the school system cannot find another source, it doesn’t have to raise pay.
Greenlighting the request would also drive spending far beyond what the Spending Affordability Committee — which advises the county on annual operational expenses — recommended the county spend this year. The county’s operating budget is just $2 million under the committee’s recommended spending cap.
Council Chair Julian Jones said the surplus comes from unfilled positions and unspent money allocated to combat the ransomware attack on school networks in November 2020.
Following the spending committee’s guidance is “how we keep our fiscal house in order,” Jones said. “The $50 million will blow that.”
Olszewski said taxpayers would ultimately pay 17 cents more on their property tax rate and that “vital services” might be pared to sustain the school funding.
“I have an obligation to balance our historic [school] investments with the needs of our residents and taxpayers,” he said.
Schools Superintendent Darryl Williams said in a statement that the board and school officials are committed to providing compensation changes and are “exploring all avenues” to make it happen.
“The dedication and invaluable efforts of our staff in the face of unprecedented challenges should be commended and rewarded,” Williams said. “If we are to achieve our vision of being among the highest-performing school systems in the nation, we have to take bold steps to invest in the staff who make it possible for our students to thrive.”
The school system would use $49.6 million from its fiscal 2023 fund balance to cover the first year of the salary increases after the County Council signs off. If the request isn’t granted, it’s up to school officials to consider whether to shift money from other programs to raise pay.
“The fact that we’re going to need so much money in [fiscal 2024], do you agree or feel that it’s crucial that we now start to look at ways to prepare for that internally?” school board member Rod McMillion asked during Tuesday’s meeting.
“Yes, that would probably be the prudent course,” responded Whit Tantleff, the director of budgeting and reporting.
The debate comes amid years of discord between county officials and school leadership and against the backdrop of a global health pandemic and a ransomware attack in November 2020 that sabotaged the school system and continues to impede some operations.
Council members have criticized Williams for failing to communicate with elected officials and in June called for his ouster. That month, the council denied a routinely requested funding transfer by the school board to send a message about their frustrations with persistent issues like the bus driver shortage.
If the County Council does approve its transfer, the school system would have $65 million left in its fund balance.
The money will remain in the school system’s coffers, according to county officials. Olszewski said believes school officials can shift the funds that were allocated this week for wage increases.
Councilman Izzy Patoka, a former division manager of Baltimore City’s capital budgeting who also crafted the county’s capital budgets decades ago, echoed Olszewski’s and Jones’ opposition to funding operations with one-time leftover dollars.
Patoka, a Democrat, suggested school officials working in the district’s Towson headquarters should “perhaps look at tightening the belt” on their own salaries to free up funding for teachers and staffers without drawing from its surplus.
Salary raises are also on the County Council table for council members, the county executive, and chief administrator per recommendations by the Personnel and Salary Advisory Board, which is charged with reviewing pay changes for elected officials and the top administrator every four years.
The pair of bills would boost the officials’ salaries by about 10% — the first raise given to the elected officials since 2014 — and wouldn’t go into effect until new officials are sworn in after the Nov. 8 election. The county administrative officer’s salary was last raised in 2017 under a prior administration.
This would also repeal a cap that precludes any council member’s pension from being more than 60% of their average final compensation.
Asked to explain the difference between the proposed salary changes currently in front of the council, Olszewski said the school board is “asking for tens of millions of dollars of one-time funds outside of the usual budgeting process,” while compensation changes currently before the council follow “a process prescribed by law.”
It “is in no way similar to what the [school] board is asking for here,” Olszewski said.
This story has been updated to correct the amount the proposed raises would cost. It is a half-billion dollars over five years.