CHEYENNE — The external cost adjustment for K-12 public schools totaled $70 million when it left the Wyoming Legislature’s Joint Education Committee earlier this month, but it now stands at $43.3 million for fiscal year 2024.
Members of the Joint Appropriations Committee cut the recommendation nearly in half during their meeting Thursday morning, and recommended not sustaining the amount for more than one year.
Rep. Lloyd Larsen, R-Lander, introduced the motion to allocate $10.2 million for education materials and energy, which was approved last year, and an additional $33.1 million for professional and non-professional labor. He didn’t include the $15.8 million for education materials, and an additional $10.8 million for energy that was recommended by the Education Committee to account for inflation.
It was based on data from the U.S. Bureau of Labor, which revealed material costs have risen 12.59% and energy costs have increased 27.58%.
Larsen said he prefaced his recommendation based on his own research following the Legislature’s consultant’s suggestion of a 27% energy cost adjustment.
He reached out to local energy providers and said electrical utility companies only pointed out a 4% increase. He said the increase was largely due to natural gas, instead of electricity.
“The point that this committee made earlier is that maybe when we have these conversations and make these recommendations, we try to hone down a little more regionally on energy costs, because we do see some difference compared to the national average,” he said.
His motion was approved in the majority by the committee, but Rep. Andy Schwartz, D-Jackson, said he would be voting no.
His preference was to forward the full $70 million recommendation that would have been enacted on a cumulative basis to Gov. Mark Gordon, who will announce his supplemental budget proposal Nov. 18.
If the original recommendation had been approved, it would have helped close the gap in the $90 million shortfall between the evidence-based K-12 funding model and the statutory model that was presented by Legislative Service Office analysts.
Laramie County School District 1 Financial Director Jed Cicarelli told the Wyoming Tribune Eagle cutting the recommendation, as well as not sustaining it into the future, puts school districts in a compromising situation.
He said it is difficult for officials to navigate how to adjust their budgets with one-time funding, especially when hoping to adjust to labor market salaries for staff.
“Inflationary factors don’t impact us for one year and go away. They’re cumulative,” he said. “When we have those ECAs applied only for one year, we have to decide how we’re going to navigate one year from now, when all that funding goes away. And that’s really been the predicament that we’ve been in for over 10 years.”
Cicarrelli was among the education stakeholders who made their case for the full external cost adjustment before lawmakers voted Thursday.
They said school districts’ purchasing powers were continually being eroded, as well as their ability to hire high-quality educators.
“In June this past year, over 10% of our employees resigned. We had 68 resignations; only eight of those were retirements,” Teton County School District 1 Trustee Janine Bay Teske said. “The rest of those were employees who left as a result of their inability to afford to live in our community and the stress associated with it.”
This led to the board of trustees approving taking $2.5 million out of the district’s reserves to supplement salaries, which she said she didn’t feel comfortable with, but felt was necessary.
She said this was due, in part, to the lack of an external cost adjustment for labor in order to boost base salary levels.
Allocations also fell short for supplies and materials, as well as utilities, Teske said. Despite the one-time adjustment of $10.2 million for school districts in the 2022-23 school year, they still needed to find $122,000 elsewhere.
LCSD1 experienced similar setbacks when handling inflationary pressures.
Cicarelli said they had more than 60 vacancies in their certified positions at the start of the school year, and additional vacancies for bus drivers, facility staff and paraprofessionals.
The district used $1.8 million from its reserves to adjust salaries and is paying teachers an additional portion of their salary to pick up extra classes in the wake of the ongoing teacher shortage.
Appropriations Committee co-Chairman Rep. Bob Nicholas, R-Cheyenne, asked if the districts were able to use the funding received from the federal government, but Cicarelli said there were stipulations attached to that money.
Some money was saved from using the federal funding to offset costs, but it could not be directly put toward reserves.
He said continually pulling money from the reserves in the future would not be sustainable.
Converse County School District 1 Superintendent Paige Fenton Hughes reiterated the concerns of the other districts but pointed to the closing wage gap compared to other states.
Wyoming, once a leader in the region for teacher salaries, continues to fall behind.
She said it has put a strain on having a quality hiring pool.
“When you have 135 applications for an elementary job, your chance of getting a rockstar in that classroom is pretty good. When you have three, I don’t know – my math isn’t great, but you can tell it goes down,” she said. “I really became concerned this year when we could not hire a first grade teacher.”
Legislators were told the $70 million recommendation would not be extra funding going toward the school districts, but rather a mitigation strategy to offset inflation.
“This is not new money for education,” Wyoming School Boards Association Executive Director Brian Farmer said. “This is just an exercise in mathematics to say, ‘Is there inflation, and if there is, how do we keep it whole? How do we keep the purchasing power whole?”
This story was published on Oct. 28, 2022.