1. District officials said legal settlements were $53 million instead of the $20 million budgeted and there was a $15 million contract for cybersecurity software, which was not properly budgeted for. There was also an error in calculating increased pay. How is this impacting schools?
A: Apparently there are two separate issues – legal settlements and cybersecurity software are being blamed for the $10 million deficit.
But schools are cutting staff, programming and supplies because on top of that, there were miscalculations in the January 2024 budget, and are unrelated to the district’s $10M deficit.
The January issue is that the projected budget didn’t include the 8 percent raises it had agreed to in December with Clark County Education Association, and also the budget used the incorrect formula for at-risk funding.
The district also under estimated the average cost of a licensed educator by $5,700, which, when multiplied for the 16,500 educators it budgeted for, meant almost $100 million spread across schools. So this fall, schools found themselves with higher costs for teachers after being given incorrect budgeting information.
There was yet another error in calculating funding for at-risk students that led to schools receiving $928,000 less than expected.
As a result, 36 licensed professionals, 41 support professionals and five administrators have been surplussed, or reassigned, often to a lower paying position.
2. The district plans to take money from the reserve fund to make up the difference. What are some other big ticket items the district is spending on?
A: We talked about this on this show in December that the district’s cybersecurity and other IT costs more than doubled from under $10 million to $21 million last school year, part of the fallout from the “cybersecurity incident” last October.
But when you think about $53 million for legal settlements and $15 million contract for cybersecurity software, it’s not that much for a district this size.
Bigger ticket items for school district are the many construction projects — more than almost $600 million went to construction companies last year – about half, $285 million, went to Sletten Construction of Nevada Inc. This year modernizing Aggie Roberts Elementary School and working on other projects replacing aging schools for the district, including [building a new Gymnasium at Southeast Career Technical Academy – SECTA. T]the Gene Ward school rebuild.
This year isn’t over yet but so far, once again Slotten Construction and Rafael Construction are the largest contractors this year – $63M to Slotten and $28M to Rafael Construction
CCSD also paid consultants more than $60 million in a six-month period this year from January through June 2024, the largest amount in a six-month period since at least 2012, according to an analysis by The Nevada Independent. It paid more than 375 individuals and groups.
The funds were mostly designated for professional development and wraparound programs, which can include anything from at-home behavioral health services to after school care.
3. Even once these shortfalls are paid for, there could be more fallout for the district, right?
A: Yes, the state Taxation Dept appointed a subcommittee to monitor the budget and fiscal activities of the district.
The subcommittee will make a recommendation on whether the district should be placed on a fiscal watch.
The district was last placed on watch before in 2018 after three years of declines in its reserve fund. This will be only one year.
Gov. Joe Lombardo asked the Taxation Dept’s committee on local government finance to review the district’s budget after hearing about the deficit.
This isn’t the first time the school district got negative attention from the governor – you may remember that shortly after taking office, Gov. Lombardo required all school districts in the state send his office their audits.
So last spring, Clark County schools was released, it came after state lawmakers had asked for a legislative audit of the Clark County schools specifically, since it had been almost 20 years since the district has been audited by the Legislature
Besides the increased oversight, Channel 3 reported that an attorney for the district says he could see discussions about potentially breaking up the district, the fifth largest in the country.
So the $10 million budget shortfall could really have far more negative impact down the road.