Thursday, May 17, 2012

The Grant Not Taken

The rumblings are no longer rumblings, they have turned into reality. Dr. Scanlon has confirmed that on May 2nd he notified the PA Department of Education that WCASD would be declining the Keystone to Opportunity grant it was awarded.

The Keystone to Opportunity Grant that West Chester won was made possible by Pennsylvania’s receipt of $38M from the Federal Readers Comprehensive Literacy Program. Thirty-five states applied for this funding and PA was one of only six to receive it with the second highest award behind Texas. The purpose of the Federal program is to help states pursue a comprehensive approach to improving literacy outcomes for all children from birth through grade 12, including limited-English-proficient students and students with disabilities.

West Chester applied for $877k for literacy development in the 4 areas outlined in the grant application: Birth to Age 5, Elementary, Middle, and High School. A literacy plan was proposed that would improve transitions at the 3 key shift points that children experience in their K>12 school career: from pre-K to K, 5th grade to 6th and 8th grade to 9th. The grant process was extremely complex and competitive, and unfortunately West Chester did not receive funding for the elementary, middle, or high school portions of their proposal. They were, however, fortunate to be awarded $453k per year for 2 years to be targeted toward Birth to Age 5. More than 350 school districts applied for this grant, and only 58 (~16%) received awards. I’m not aware of any other district that declined their grant.

Upon learning that the district had declined this grant, of course questions were raised. Some answers were given, but honestly none that make sense to me or anyone else I’ve spoken to. Currently the board is not responding to any emails on this topic (although Mr. Carpenter did return my emails early on), and Dr. Scanlon is being asked to address all questions. The stock explanations being given to inquiries are that the grant was declined because 1) it would increase the expense side of the budget by $453k and 2) the funding was not for an existing program so would require the district to take on a new program for students who are not current participants in our K>12 school system. I’ve also heard a 3rd reason cited that the existing grant approval process was not followed, and a 4th that we would be left with responsibility to continue the new program after the funding was gone.

Being a numbers person, I find the financial explanation the most flagrant as it simply cannot be supported mathematically. According to Dr. Scanlon, of the $453k/year offered in the grant, $417k would be directed toward 6 West Chester non-profit pre-schools that are not part of the WCASD system (although they are within its geographic borders); $23k would go toward the WCASD literacy program, and the district would get $13k for administrative costs, presumably to address the overhead in managing the grant with the non-district entities. Due to this $417k being redirected outside the district schools, Dr. Scanlon was told by the Board President and the P&F Committee Chair that in order to accept the grant, $417k would need to be cut from our district budget. Due to the large cuts made to our budget over the last several years (nearly $14M over 3 years), Dr. Scanlon did not feel comfortable cutting another $400k+ in programs for the 2012-13 school year. And why would he, you might ask? But the real question is WHY SHOULD HE?

Anyone who has any financial acumen knows that financial performance is not driven by revenue or expense individually, but how they relate to each other. If I were to tell you that my business generated $300M in revenue last year, would you say that was good or bad? Would whether I incurred $150M vs. $400M in costs to generate that revenue impact your opinion? Of course it would. Same story here, it’s not about what this grant would do to our expense line item, but what it would do to the net difference between our revenues and our expenses. Although a grant would flow through both the expense and revenue side of our income statement from an accounting perspective, at worst it has $0 impact to our operating results, and in this case provides us with $36k positive benefit. It is predominantly an accounting pass through of funding from us (from the State Government, from the Federal Government) to early childhood education providers. So given we would not be spending any more of the district’s funds, why would we need to cut $417k from our budget? Doing so would mean our budget would have a positive $417k impact, not stay flat, which the grant accomplishes. Making this reduction to expenses is not a requirement for accepting the grant; it is a self-imposed condition by the board.

The second reason cited for not accepting the grant, the fact that it would require the district to take on a new program for students who have not yet entered Kindergarten and thus the “responsibility” of the WCASD, suggests a lack of recognition of the critical role that early childhood education plays in the future success of a student. Preschools were unfortunately not allowed to apply directly for this grant, so were reliant on their local school districts to do so; now these 6 early education providers will be deprived of receiving funding that would have had significant impact on their ability to deliver quality programs to their students. There are countless studies showing that at-risk children who participate in high-quality early education programs are more likely to enter school ready to learn, perform better in school, have a higher graduation rate, and are less likely to be involved in juvenile crime and violence. Aside from the clear benefit this has to children, for those only concerned with the economic side this also means less cost and more benefit to our government and economy in the long run. Current best practices suggest that learning should be seen as a continuum starting from birth, and in these difficult economic times the more education providers cooperate, the better results and lower cost for everyone. For WCASD this would mean less time and money spent on these children once they do enter the district, leaving more resources available for regular education students who are not protected by as many laws and will continue to lose as budgets shrink. The following opinion piece by Ted Kleisner, Chairman and CEO of Hershey Entertainment & Resorts Company and member of the PA Early Learning Investment Commission, does an excellent job describing the economic drivers for investing in early childhood education even in the hardest of times:

As far as the grant policy not being followed, the current policy was written in 1981 and states that the district should have guidelines for grant submission and the board should be provided with the grants to which the district is applying. In practice, no such guidelines seem to exist and for as long as anyone can remember the board has not been consulted prior to grant application but only after a grant has been awarded. Is that to say that the board would not have approved applying for this grant had they been consulted in advance? In these challenging economic times, isn’t it the job of a superintendant to look for additional revenue streams that will not impact taxpayers? What expertise does the board have to determine which grants should and should not be pursued? The Administration was acting in good faith for the financial well being of the district and the educational well being of its students, as they should be. To penalize them (and really the children) for not asking in advance seems a bit like cutting off your nose to spite your face. And as far as the need to continue the program after the funding runs out, I have not seen anything official suggesting that is the case. I suspect if it were, that reason would be communicated loudly and clearly since being obligated to continue a new program for non-district students without funding is very different than acting as a conduit for funding to be directed toward future students with expected future benefit. I highly doubt that is a position Dr. Scanlon would put the district in.

As sad as the loss of this funding is for West Chester children, the more troubling part of this situation is the manner in which it was handled by our board. My understanding is that the district was notified in mid-April that we won this grant and the board was notified soon after. Based upon the concerns cited by the board president and P&F Committee Chair (as noted above), the decision was then made not to accept the grant. This was done without any public discussion, without any notification to the public despite the fact that one person congratulated the board and administration on winning this grant at the April 30th Board Meeting, and apparently without the input of all board members or any sort of vote. Is this how a school board is supposed to operate?

Despite the board’s silence, this story is playing out online. Some of the more noteworthy comments and questions I’ve seen are:
  • If you wanted to spend an additional $417,496 you would not just ok it without some public disclosure; so why if you were given $417,496 do you refuse it without the same public disclosure?
  • Some members of the Board made a decision but did so in private and have done little to explain themselves. What else are they deciding in private conversations and emails that the taxpayers, parents and students will only learn about after the fact?
  • It would be much easier to accept the decisions of this Board, even if one were to disagree, if they would publicly own their decisions and welcome debate; they either think that they have no obligation to explain themselves, or just don't care to.
  • I am just mystified as to why, when they have spent the year looking for alternative revenue streams, that this is their tactic. In education and all non-profits grants are a part of lifeblood.
To add insult to injury, rather than acknowledge that they did not handle this situation as well as they could have and attempt to explain their actions to the public after the fact, the board has completely shut down on this topic. I know of at least 3 people who have repeatedly asked questions directly to board members, only to receive a response from Dr. Scanlon that “questions regarding the Keystones to Opportunity Grant are being referred to [him]” because “part of [his] role is to serve as the official spokesperson for the school district”. That may be true, and Dr. Scanlon is certainly in the best position to explain the mechanics of the grant, the related discussions he took part in, and the resultant actions that were taken. But what he is NOT in a position to respond to, and what people really want to know, is WHY the board gave the direction that it did, WHY the board did not feel this topic warranted public discussion, and HOW they can use the noted reasons as rationale for refusing this grant when they simply don’t justify this action.

Dot Krikorian summarized the issue well: “The board deserves credit for a good budget based on the economic reality we face, but that goodwill does not provide a free pass on public discussion and exchange on important issues facing the district. The board and the community have made great strides in moving forward together in tandem. However, the perception is this board is on a mission to limit public exchange with their recently passed resolutions for public comment and PTO guidelines and unfortunately, the lack of information regarding the decline of the KtO grant only adds to this perception.” To these concerns, the board has repeatedly stated that they are transparent, accessible, and responsive. The business definition of transparency is “operating in such a way that it is easy for others to see what actions are performed and the rules and reasons behind those actions; a lack of hidden agendas and conditions, accompanied by the availability of full information required for collaboration, cooperation, and collective decision making; a degree of disclosure to which agreements, dealings, practices, and transactions are open to all for verification”. This sure doesn’t feel that way. It feels like our board made a decision in private and now is refusing to answer questions that only they can answer, and putting the superintendant in the hot seat to deal with the aftermath. I don’t believe that that is behavior fitting of elected public officials, and I don’t believe it is what our community deserves.

So, then, why did the board really not want to accept this grant and what are the possible long term ramifications? Possibly they have an ideological opposition to accepting money from the Federal Government due to our significant Federal deficit. Unfortunately this grant will not be returned to the Federal Government, but instead will be awarded to another district, so nothing was accomplished in relation to that. Nor should board members be making decisions for the district based upon their personal political beliefs. If, in fact, our board does believe it is wrong to accept money from the Federal Government, what does that say about their view on our State Government applying for and accepting it in the first place?

There is also the issue of keeping to the $202M 2012/13 “Budget Goal”. I’ve put this in quotations, because the first time this “goal” was mentioned was at the April Property & Finance Committee meeting, just one week prior to the final budget vote. Where did this goal come from, and how come it was never discussed before? Wouldn’t such a goal have been useful to have when the Community Budget Task Force began its work in the fall of 2011? The appearance is that all acceptable and feasible cuts from the task force were enacted for this budget cycle, and then a little more was squeezed out at the very end. Could this be part of the reason some board members (and perhaps other behind the scenes individuals having an influence on the district’s budget) were willing to agree to the 1.7% tax increase? The fact that our budget had decreased for 2 years in a row was certainly used as a selling point and victory for the board, and why not, it is an impressive accomplishment. However, is it a good enough reason to deny literacy funding to needy children that will likely cut future costs for the district? 

What does this mean for the future of our district? What will this do for employee morale when people see the district “give back” money in the face of large cuts and impactful contract negotiations? Does this signal an unwillingness of the board to pursue other grants in the future? If we do apply for other grants, will we still have a chance to receive them or will we be blackballed for what can be construed as discourteous behavior in rejecting a grant that we applied for and others spent time considering? If grants are no longer a prospective source of income and future tax revenue increases are tenuous at best, how will we meet the imminent cost increases we know are on the horizon? The answers to these questions could signal more trouble in our future.

No comments:

Post a Comment