DPSCD Special Board Meeting on Budget, 6.10.2025

    2:50PM Jun 11, 2025

    Speakers:

    Keywords:

    Budget hearing

    Detroit Public Schools

    revenue increase

    expenditure

    surplus

    literacy lawsuit

    special education funding

    interest income

    school staffing model

    enrollment strategies

    guidance counselors

    summer school

    facility improvements

    public comment

    meeting norms.

    This is our Detroit Public School community district, Board of Education special board meeting and budget hearing. This is our call to order. The time is 503. In the afternoon. Miss Daniel Moore, yes,

    ma'am. Monique Bryant present, Sherry gay. Daniel go Angelique Peterson, Mayberry present, Dr Iris Taylor, Dr Ida Simmons short, Latrice McClendon, Bishop. Coletta Vaughn present, Michael West present, Naomi Babatunde, present, Madam Chair, you have a

    quorum. Thank you so much. Thank you so much. Miss Moore, would you also read the meeting norms for the special board meeting tonight?

    Ivania Moore, secretary to the Detroit Public Schools community District Board of Education, do hereby certify that the foregoing notice of the special meeting of the Board of Education was delivered to each board member on Monday, June 2, 2025 according to its applicable statute. Thank you. Meeting norms, we respect the rights of all persons to participate in this public meeting of the board and kind of request that everyone engage in behavior that supports the same in the event anyone engages in behavior that is not in support of the good we request that you refrain from that behavior. Thank

    you so much. Please note the record Miss Moore, that Vice Chair is here at the table. Also public comment. Registration for the special board meeting is now closed. Another will consider a motion for the agenda to be adopted.

    So moved, Madam Chair.

    Is there support? Support? Thank you so much. There are no changes hearing, none. All in favor. Aye, no oppositions. Motion is carried. Thank you tonight, it's very important for our budget presentation. All right, thank you so much.

    Good evening. Board members and community. This evening, we'll be presenting the proposed budget for the 2526 school year, first I'll review the DPS budget, and then I will review the dpscd budget.

    Beginning with the DPS budget, we expect a slight increase in revenue. This is on the operating millage. This is based on continued increase of property values and collection rates remaining the same. So approximately $3 million increase on the expenditure side, expenditures are remaining the same for the year, both for the support services, for the debt repayment, we have only the minimum payments, the interest payments that are scheduled to be paid next year for the emergency loan, all told, there will be a surplus in DPS. This surplus is going to continue to grow until we receive the outcome of the current litigation with the state regarding whether these funds can be used to repay the school loan, revolving debt, otherwise, this concludes DPS as we move into dpscd. Dpscd, we're proposing using the governor's budget proposal. As you know, the governor, the House and the Senate all proposed budgets, typically, they have a more formal presentation by this point, but we're still waiting on the final house budget presentation that should be coming, potentially later on this week. So with all the available information, we are using the governor's proposal, which includes a 4% increase in our per pupil, roughly $392 that would lead to an additional $19 million in revenue. We are also continuing to include the literacy lawsuit funds, and the second year of that, the governor's proposal does have a modest increase in special education funding. As you will recall, we continue to run a deficit in special education. The state does not fully fund nor does the federal government fully fund special education. But this will this increase will offset some of those deficits. For right now, we continue to anticipate titles one and four and Ida will remain flat based on the continuing resolution that was adopted in March. There are questions about title two and title three and whether they will continue, but at this point, we have available grant dollars or surplus dollars that could be used if those grants are cut, but we do include them. Additionally, we have interest income of approximately $33 million this is. Assumes interest rates continue to remain at about 4% for next year, we will adopt a budget as required by law tonight, as the governor and the house come to a final budget reconciliation, we will then bring back a budget amendment in the fall that reconciles to that actual final adopted budget, as well, as we get additional information from the federal government regarding potential cuts, we will adjust the budget related to that and bring that included in a budget amendment. As we have that information regarding proposed expenditures and priorities that are included in this budget, this budget continues to fully fund all positions. So one of the commitments that we as a district have made since returning from emergency management was to fully fund all positions and to ensure that we don't run annual deficits. The budget is balanced. It does anticipate a $10 million reoccurring surplus. It's included in the budget all negotiated salary increases as part of the two year contract agreements and bonus payments are included in the budget. All programs and discretionary spending are maintained at their FY 2025, levels, so their current levels, we're continuing to fund the school staffing model, and we'll review that, and we're protecting investments in schools and programs for students, as well as staff culture and climate in the buildings. The literacy lawsuit positions will continue as part of the second of the three year program that will continue there. We're continuing the school additional funding for incentives, attendance incentives, additional field trips and work to continue to improve climate and culture in our schools. The high school attendance incentives will continue, as well as will add volunteer incentives to increase and improve volunteer volunteer systems and volunteering at our schools. We will implement two transportation pilots for our high school programs, specifically at Henry Ford and East English Village. This will include using yellow bus transportation to increase access for those students in those high school feeder patterns to try to increase enrollment and daily attendance. We will add additional staff to our OIG department, homeless ese, procurement, employee relations and title nine offices to improve efficiency, improve responsiveness for the district services, and will continue to monitor expenses and as we have one time program or investments, we'll use available one time dollars to make those investments in it, refresher, refreshes, marketing curriculum and other one time needs as approved by the Board at future budget amendments regarding the school staffing model that I highlighted just a moment ago. The school, school staffing model that we developed about six years ago remains consistent with no changes. It funds schools based on their neighborhood, type and grade level, and you can see the allocations there. We're continuing to sustain all programs that are available in schools, as well as the additional investments that we made this past year related to the attendance incentives and other incentive programs. So all programming will remain consistent at school based on their student enrollment. So it is a positions that are earned based on enrollment. So the only changes we would see in staffing at schools is there was a decline in enrollment, or if there was an increase in enrollment, then we would see a corresponding change in positions regarding the literacy lawsuit. This just highlights those continued expenses and investments for this year and then the coming year, we're continuing to invest in our k2 academic interventionists, building on the success of the program from this year, we're going to continue to incentivize top performance with our bonus pay based on growth, on the i Ready literacy program. We are not continuing the foundational skills. Those were one time investments that we were made this year in schools. Those are kidney tables, additional resource materials that we just there. The equipment will be in schools, and so we don't need to continue to buy it. So it's a one time investment. The differentiated pay will continue, but we have a state grant that we can use to fund that, so we don't have to use literacy lawsuit funds, we will continue the k3 class size reduction teachers as well as the teacher leader release those teacher those positions will continue. And then finally, the hard to staff bonus was was not agreed to with the unions, that was already informed with the board. And so that won't continue, because there was no agreement with the with the board. We're continuing to monitor what happens with AmeriCorps City Year, but the current plans are to continue City Year as its current funding and program levels, provided that City Air continues to operate. But again, we're continuing to monitor that. We're continuing the program for the let's read and this. Stipends, as well as continuing the supplemental reading intervention program that was purchased this past year. As you can see, under diverse learners, we're continuing the multilingual AIS and the expanded newcomer program that's operating at Western and harms for our newcomers. And then you can see the English language development curriculum that was a one time purchase. So we made that purchase, we now have the curriculum material, so we don't need to continue to do that. And then the next two items, we the negotiated pay for MML training, that's multilingual learner training, as well as the English as a Second Language Teacher Certification Program. We have state grants that will fund those programs, so those programs will continue, but they will be funded in state grants. Lastly, around extended time and culture of literacy, we are continuing the parent academies and literacy programs that were done this year. Those will continue next year, the high dosage tutoring and the take home backpack, the books, those were one time investments. As we look at the overall revenue, we do see a shift as you look from FY 24 to 25 and then to FY 26 the big change that you're going to see here, there's two of them, one FY 24 had the remaining Esser funds as effort and Esser ended those fundings at the federal level declined. You will see a slight increase in federal level, federal funding in FY 26 we are anticipating that the state does process our FEMA reimbursement. That increase is related to the $70 million that we were approved by FEMA, but has been held up at the state and has not yet been dispersed to us. We believe that will be disbursed after October one of this upcoming year, so we'd receive that that is one time money. State funding is generally similar. The decline there is related to mipsers and the one time payments, though, the state has been funding mipsers through one time payments, they give the funds to us, and then we pay it back to the state. So that is been reduced with the change in the mipsers reimbursement rates. And then at the local level, the revenue is generally consistent.

    On the expenditure side, the biggest expenditure that we have is personnel. This is salary and benefits. The decrease here is related to the mipsers. We don't have those pass through payments from the state. So that's related to the decline there. As we move up, purchase services are slightly lower. That's primarily related to school based budgets. Schools have the opportunity to continue to amend their budget throughout the year. Schools start with money, generally in supplies, and then they amend it to hire additional vendors throughout the year. So we expect that to happen. If those funds are moved to be similar. We do are seeing slightly lower under equipped around supplies. We anticipate this because of the one time literacy lawsuit, purchases that we already made and will not make for the upcoming year, equipment and capital is generally the same, and then utilities are slightly increased based on increased utility rates for next year. And so you can see this and the overall financials for the budget for FY 26 and then, as I said, just to go back overall, there's a reoccurring surplus of $10 million you will see the $80 million surplus at the bottom. That includes the one time $70 million of COVID funds, not COVID, I'm sorry, one time 70 million of FEMA funds that are included in the budget. If we do not receive the $70 million we still have a balanced budget, the surplus would be approximately $10 million okay? Dollars. And then lastly, as we take a look at the five year forecast, you'll see we have a budget surplus projected for this year for roughly $37 million this would be our ninth consecutive year of a balanced budget. We are projecting a budget surplus for FY 26 and FY 27 there are a slight declines. As we look forward, I will say we are always budget very conservative, so we are using only two and a half percent as the revenue increase. Over the last four years, we've been averaging between four and 5% per pupil increase. So if we were to get a 4% per pupil increase each year, there would be no deficit. Additionally, as we look at this, these are very small increases that we could absorb by adjusting our budgets. This currently assumes that Office of School nutrition food funding is decreased again. If that maintains, then there would be no deficit, which we do believe now that the federal government that they will continue to fully fund the Office of School Nutrition. We've talked about these before, and so I won't highlight them again, but just the ones to note is related that I didn't mention Medicaid. Aid Medicaid is roughly $9 million of funding that the district receives to support the special education program that we're required to provide. If Medicaid funding is removed, we would still be required to provide those services, but then we would just have to use general fund to offset those costs. There is a risk the federal government is reviewing and voting on the budget that would reduce Medicaid funding. If that happens, then again, the district general fund would be responsible for the increase in costs related to that. As we have said, the community eligible option for school food program does not appear likely to be cut. It will remain consistent, so we do not expect any change there. The Health Resource advocates Grant was already cut, and we informed the board those costs have been absorbed in the budget as well as then we've identified the potential phase out schools and accelerating those as part of the budget proposals. The last two budget amendments that we have are the food service budget. So as I say again, this is a very conservative budget. We have not included any one time revenue, so you will see a slight decline in revenue that is just based on holding reimbursement steady and no one time federal funding. So we do potentially have some upside there on the expense side, it does assume that the tariffs and increased costs are going to impact us. So if those, if the tariffs do not come back, are are reduced, then we won't have those increased costs, even though it is projecting a deficit, there is a surplus in the Office of School Nutrition, so the district general fund would not be responsible. The school nutrition fund would be able to fully absorb any deficit that was incurred next year. And then the last budget is related to student fundraisers. So these are activities, programs, the band club, the robotics club, the chess club, that where schools have fundraisers, raise funds or receive donations for additional field trips or sponsors. This is money that comes in and then goes back out. It is only impact students. The student activity account can only be used to impact students. Of these funds, the board is required to adopt this budget, and we do monitor it as well as evaluate it with external auditors. But this does not impact the district's general fund. Is just related to student activities and student actions. And that concludes our budget hearing or our budget presentation.

    Thank you, Mr. Vidito, to the board. I know that we have discussed the budget in both committees, but we will open the floor now for any questions or commentary, any questions.

    Thank you. Dr Vitti, can you address we're talking about a 1% increase in enrollment. What are we doing so that we can see something better than a one, 1% increase? I know we're putting more funds in marketing. What are our KPIs that matches like how we attract more students to our school? I

    through the chair. So the 1% is a fairly conservative number from a budget point of view. So obviously we intend and want to increase the enrollment more than 1% but in order to not create a funding shortfall by being more aggressive, we say 1% that way, if we say 5% or 3% and we don't hit that mark, we're not scrambling to then figure out the loss in revenue as we go into the next year. But 1% reflects the type of improvement that we've seen over the last year and the last two years, when we talk about increasing enrollment, I think the number one strategy is retention. What we have been seeing over the years. This was the first year where we actually recruited more students than we lost from a retention point of view. So the I would say, more than anything from an enrollment point of view, it's continuing to try to increase retention for the students that are already in the school district, our retention rate improved by about one percentage point by memory to, I think, 71% but that continues to be one of our greatest challenges. In addition to that, it's continuing to increase pre K, we are striving to be at about 2300 students next year for pre K, with about a 70 to 80% retention from pre K to kindergarten. So that continues to be one of our strongest strategies. Our other strong strategy, building off of last year, is improving the retention of eighth. Ninth graders. So obviously our exam schools have increased enrollment, but we're trying to increase the enrollment of application schools with students that aren't selected for the exam schools that they're asking for to consider an application school or their neighborhood High School. And then beyond that, you mentioned the marketing. Certainly we are going to invest more in marketing, but beyond that, more canvassing over the summer at the school level, we'll have central office support, but more canvassing at the school level, with schools that have low market share with the number of or the percentage number of students that should be attending their school that don't because they attend somewhere outside of the feeder pattern at a high level, those are the strategies for this summer, and I keep it at that and certainly open to questions or suggestions beyond that.

    Yeah, I think we should challenge ourselves with more than 1% of enrollment like we're trying to increase the number of our students, I think retention and new students, you know, are two different categories, and we when we put as much money as we're putting in marketing, I think there's an opportunity to say, hey, can we hit a 5% goal of increasing the number of new students enrolled in our schools? And I'm sure there's some science and data behind it, but I think that we should have a little bit more robust of a report to understand like what we're doing to increase new enrollment. So my ask is to have some type of like information that says this is what we're doing, because 1% it moves the needle, but not where we need to be, especially since there's an increase in per pupil dollars this time around. The second question I had, could you explain what a guidance counselor actually does? And I noticed in your notes, it was one per 500 students and one per 400 students. And can a guidance counselor properly assist 500 students and properly assist 400

    students? Yeah. So board member Brian at the academic committee level did ask for a presentation on enrollment. We didn't get to it during the last committee meeting, but I'll bring that back for this upcoming academic and Finance Committee meeting, which is just a focus conversation around enrollment. And so we'll go over trends. We'll we'll go deeper into strategies, not opposed to be more aggressive around enrollment. I would continue to say, I think there's a there should be a difference between how we budget for the increase enrollment and maybe how we talk internally about our goal, because I wouldn't want to set up the district to be in a financial deficit if we didn't meet our mark from a budget point of view. As far as counselors are concerned, our numbers for counselors are actually lower than what you see in the allocation because of counselors that schools purchase on their in their own budget and then add ons that we provide to schools. Our number right now across the district is lower than the national average student to council ratio, and we're fairly competitive with large urban school districts and student to council councilor ratio most schools, with the exception of our very largest one, so Cass Renaissance, Western, if you take those schools out, we're pretty close to one to 250 and so we are considering, you know, maybe going into next year, depending on what the budget looks like, going to maybe illustrate one to 250 ratio, which would really help the larger schools, not necessarily the schools that are not the three that I named. But what counselors do is, obviously they counsel students through what I would call more immediate day to day mental health challenges, conflict with other students, issues that students are naturally experiencing when we start to get into the need for therapy, one on one small group, that's what we rely on our mental health support structures. It's not to say that the counselors won't do that work, but when it needs to be more intensive and more consistent, that typically then moves to the mental health contractors that we have at school, but our counselors do mediation. You know, between students, between families, at times, they'll also go into classrooms and provide lessons on the Expect Respect campaign those characteristics or characters, character development activities, and then at the high school level, all that, plus making sure that students are scheduled properly, that they're on track to graduate in four years, and promoting scholarship opportunities for students so.

    I have two more questions. One, Jeremy, in your report, you said summer school spending declines as philanthropic funding declines. I know that we just supported the foundation with X amount of dollars to increase to make sure they have enough staffing. Could you speak more? Dr Beatty to why the philanthropic funding is declining.

    We are expecting philanthropic dollars to remain the same. The largest donor is Ballmer, who will continue that summer school investment is actually increasing for next year. The federal money, the federal funding, was going down due to the one time Esser funds expiring. So were you, I'm not sure where you were referring

    in your slide. You literally said summer school spending declines as philanthropic funding declines somewhere. I just read it, so I just wanted some clarity

    on that we are not anticipating any decline in summer school for this year. We're increasing it. We had about 6000 students served. We are anticipating or recruiting up to 10,000 students for this year, so there is no anticipated decline in summer school. And I apologize, I'm not for sure. Do you know the slide number? I don't, but I didn't get back with you. Okay, yeah, that was definitely a misstatement. There is no decline in summer school, and all of our other funding generally is consistent with again, Ballmer is the largest individual funder that we have. They will be contributing close to $17 million for next year for the summer school program, okay?

    And then Dr V my last question is around facility improvements. You mentioned that there is some one time money investing that we're going to invest into, like roofs and fencing. I know we recently allocated money to roofs and fencing, and we also have a facility budget that comes from some of our ARPA dollars. Could you explain why we're going to need additional one time funding?

    Yeah, through the chair. So this year's budget is consistent with previous years, where we do allocate a certain amount for basic day to day, and I would call it emergency type of fencing investment, along with roofs. But when we look at the greater need across the district, even with the FMP funding, we're still not meeting that need with an annual budget allocation. So as we move into January, when we clearly see what enrollment looks like, what the final federal and state budget looks like, and our spending trends, what we always do is we anticipate having leftover dollars at the end of the year, which we then consider one time money, and then we'll come to the board and say, based on our spending trends, You know, we look to have 10 million extra dollars that we're not going to spend because of increases in the federal or state budget. We're just spending less than we anticipated, and we'll come to the board with additional projects for fencing or roofs beyond the day to day, sort of maintenance of those and the repairs that that happened, but just to continue to chip away at the bigger hole of repairs and renovations that are needed for roofs and fencing.

    So our current facility budget that came from our Arbor dollars is completely allocated. Yes, 100%

    100% Yup, and those are that's $700 million and that's continuing. Those projects will be continuing for the next three to four years.

    Board Member McClendon, I apologize. I did find the reference for your your question on the five year budget, the Baltimore group only made a three year commitment for summer school, so we included the summer school revenue for three years, and then in starting in FY 28 we have not included the revenue or the expenditure because Baltimore has not committed to those fundings beyond FY 27 so in order to not include the expenditures and no revenue, we removed both revenue and expenditures. If Baltimore continues to commit to that, then we would add the revenue and the expenditures back in, but that's the reference in the five year budget for FY 28 and

    do we know when we will have a commitment from Ballmer, or if we will have a commitment for Ballmer, as we're looking at our budget, just continue to support our summer school?

    Well, this is in FY 28 so We're beginning our second year. Ballmer has indicated that they're happy with the program. They're happy with their progress, but given that we have this year's funding and another year's funding committed already after that, I would not expect any information from Ballmer for at least a year.

    Thank you.

    Thank you. Are there any additional questions for Mr. Vidito or for dr. BD, we welcome board member Sherry gay Dan Diego, please note and Dr Iris Taylor, hearing none. Ms Moore, if you would read the public comment statement, please. Do we have any one for public comments? All right, thank you. Then, is there a motion to adjourn the special meeting?

    Motion to adjourn

    for support. All All in favor. All right, all in favor. So ordered. Thank you so much. The meeting is adjourned, and we are already at 533, is it the will of the board to now move into our regular meeting. Absolutely Madam Chair. Thank you. Thank you. Miss Moore meeting. More norms. I.