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2015-16 Budget Update

July 6, 2015 - In mid-May, subsequent to the release of the June 2015 State Revenue Forecast, Oregon school districts learned that an additional $100 million would be placed in the State School Fund (SSF) for the 2015-17 biennium, taking the total K-12 allocation to $7.355 billion.  Hillsboro’s anticipated share of the additional revenue is $3.6 million for the biennium ($1.8 million/year). 


At the June 9 work session, staff presented a plan to the Board and Budget Committee that called for the following investments of the additional revenue:


  • Increase the number of PE and Music sections at elementary schools (4.2 additional full-time-equivalent, FTE, positions) - $393,354/year
  • Extend calendars for select classified positions; increase the number of classified discretionary hours at the building level - $321,788/year

  • Lower class size/reduce staffing ratio at the middle school level (4.34 additional FTE) - $406,411/year

  • Bank a portion of the funds to help offset PERS increases in 2017-19 - $500,000/year      

The Board and Budget Committee approved of the recommended investments, and the Board voted to adjust appropriations for the 2015-16 school year accordingly at their regular session meeting later that evening.


Then, in mid-June, legislative leadership announced a plan to boost the K-12 allocation by another $45 million to $7.4 billion for the 2015-17 biennium.  The plan calls for a SSF distribution of $7.373 billion and an increase to the Common School Fund allocation of $27 million.  Hillsboro’s anticipated share of this additional revenue is $1.62 million for the biennium ($810,000/year).


At this time, staff is not recommending a spending plan for the additional revenue as it is still unclear what will happen with the state’s Gain Share program.  Currently, the City of Hillsboro and Washington County are gifting approximately $1.2 million per year to Hillsboro School District (and also providing proportional gifts to other Washington County school districts); however, legislative action is anticipated to reduce the amount of money local municipalities receive through the Gain Share program, which will likely impact the amount that is gifted to school districts.


IMpact of June Revenue Forecast on Hillsboro School District Budget

District expects to receive an additional $3.6 million in the 2015-17 biennium

The June 2015 state revenue forecast (released on Thursday, May 14) showed increased projections for both the 2013-15 and 2015-17 biennia.  According to House Bill 5017, the K-12 funding legislation for 2015-17, forty percent of any increase in 2015-17 revenue projections between the March and June forecasts was to come to K-12 education.

Following the release of the forecast, Governor Brown announced that K-12 education would receive an additional $100 million in 2015-17, which would mean approximately $3.6  million for Hillsboro School District. 

This information will be shared with the Board and Budget Committee at a work session on Tuesday, June 9, so they can discuss options for the additional revenue.

Budget Committee Approves 2015-16 Proposed Budget

At their meeting on Thursday, May 7, the District’s Budget Committee, comprised of all seven School Board members and an equal number of appointed citizens, approved the 2015-16 Proposed Budget by a vote of 10-1 (Directors Cañas and Clift, and Budget Committee member Lantz were not present; Director Akers joined the meeting by phone). 


Staff provided background information to the Committee on the District’s budget situation over the past several years, and reviewed the evolving budget information for the upcoming biennium before opening up the meeting to questions and discussion. 


Though the Committee’s official duties are simply to set the aggregate level of expenditures for the coming year, set the permanent property tax rate to support the general fund, and set the debt service levy amount to support the debt service fund, the District has expanded the Committee’s role to more deeply involve them with the overall budget development process.  As such, members have been attending meetings for several months to stay abreast of changing budget information and provide input to the District’s five-step reinvestment plan.


Discussion centered around the District’s proposal of investing $720,000 of its ending fund balance in 2014-15 to four areas in 2015-16: graduation coaches ($80,000); instructional coaches, specifically focused on the implementation of AVID (Advancement via Individual Determination) programming at middle and high schools ($340,000); Talented and Gifted programming and options for advanced students ($200,000); and athletics and activities ($100,000). 


Committee members raised questions about the effect of PERS reforms from the 2013 Legislative Session being overturned by Oregon’s Supreme Court, revenue projections in future years, where money could be most effectively allocated, and an acceptable level of reserve funds for the District.


Three audience members spoke to the Committee about the importance of athletics and activities in the lives of students.


Ultimately, the Committee chose to approve the recommended reinvestments with an addition of $100,000 to athletics and activities, bringing the total reinvestments to $820,000 for 2015-16.  The Committee also decided to add a budget discussion to the work session on Tuesday, June 9, so they could review the outcome of the June revenue forecast and any additional dollars that might generate for the District in the 2016-17 school year.


The Board will vote to adopt the 2015-16 Approved Budget during their regular session meeting on June 9, which will begin at 7:30pm in the Administration Center Board Room.


Official budget documents can be accessed on the Business Office page of our website.


Notice of Budget Meeting

A public meeting of the Budget Committee of Hillsboro School District 1J, Washington County, State of Oregon, to discuss the budget for the fiscal year July 1, 2015 to June 30, 2016, will be held at the district’s Administration Center, 3083 NE 49th Place, Hillsboro, Oregon. The meeting will take place on the 7th day of May 2015, at 7:30 p.m. The purpose of the meeting is to receive the budget message and to receive comment from the public on the budget.

 This is a public meeting where deliberation of the Budget Committee will take place. Any person may appear at the meeting and discuss the proposed programs with the Budget Committee.

A copy of the budget document may be inspected or obtained on or after May 6, 2015, at 3083 NE 49th Place, Hillsboro, Oregon, between the hours of 8:00 a.m. and 5:00 p.m.


Ways and Means Committee Holding Regional Hearings

Join the local meeting at PCC Rock Creek on April 21, 7 to 8:30 p.m.


April 13, 2015 - The Oregon Legislature’s Joint Ways and Means Committee is holding a series of public hearings on the proposed 2015-17 state budget over the course of the next two weeks. 


The Portland area meeting will take place on Tuesday, April 21, from 7 to 8:30 p.m. at Portland Community College’s Rock Creek Campus.  Patrons are urged to attend and testify about why additional funds are needed statewide for K-12 education.


On March 31 and April 6, House Bill 5017 passed the House and Senate, respectively.  This bill outlines the amount of money that will be appropriated to K-12 education over the course of the 2015-17 biennium.  It calls for $7.255 billion in funds to be disbursed 50% in 2015-16 and 50% in 2016-17.  This is a departure from usual practice, in which 49% of funds are disbursed in year one and 51% of funds are disbursed in year two of the biennium to allow for anticipated year-over-year increases to the cost of doing business. 


Another provision of HB5017 is to earmark 40% of any increases to state revenue identified in the June 2015 revenue forecast (released in mid-May) to the State School Fund (SSF).


When the $7.255 billion level with the 50%/50% split was initially proposed, Hillsboro estimated the impact to be a surplus of $270,000 in 2015-16 and a shortfall of $6.5 million in 2016-17. 


However, school districts across the state recently received updates* to their 2013-14 and 2014-15 State School Fund estimates.   In Hillsboro, these updated estimates will result in a net revenue increase of $1,957,960 heading into the 2015-17 biennium. (*2013-14 updates were provided on March 27, 2015; 2014-15 updates were provided on April 6, 2015.)


The impact of these additional funds, as well as current assumptions for SSF calculations in 2015-16 and 2016-17, are as follows:

  • If the District maintains a status quo budget for 2015-16 (does the same things in 2015-16 as we did in 2016-17), we are looking at a $3.9 million surplus in 2015-16 and a $2.6 million deficit in 2016-17.

  • If the District choses to spend the entire $3.9 million surplus in 2015-16, we would be facing a shortfall of $6.5 million in 2016-17.

  • If the District makes sustainable reductions of approximately $1.5 million in 2015-16 and carries them through 2016-17, that should be sufficient for managing the biennial shortfall of $2.6 million.

What about the potential of the SSF rising based on a strong June 2015 state revenue forecast? 


Hillsboro School District accounts for approximately 3.6% of all students in Oregon, so for the District to receive enough additional money through the SSF to cover the current $2.6 million shortfall in 2015-17, the June revenue forecast would have to be up by approximately $180 million from the March revenue forecast ($180,000,000 x 40% x 3.6% = $2.6 million). 


For the K-12 allocation to rise to the $7.5 billion level, which is the level that was determined to be needed statewide to keep all districts flat or with modest increases to their 2015-17 budgets, the June forecast would have to be up by approximately $650 million from the March revenue forecast ($650,000,000 x 40% = $248 million + $7.255 billion = $7.503 billion). 


District staff intends to share this information with the Board and Budget Committee at the Board work session on Tuesday, April 28, in the Administration Center.  The Board and Budget Committee will then vote on the proposed 2015-16 budget at the Budget Hearing on Thursday, May 7. 


Updates will be posted to the Budget Matters page of our website as they are available.

House Passes HB5017, Approving $7.255 billion for K-12 in 2015-17

Why the current allocation will not be sufficient for Hillsboro School District

April 1, 2015 - Oregon’s House of Representatives passed House Bill 5017 on Tuesday, March 31, approving a K-12 budget of $7.255 billion for the 2015-17 biennium.  The bill now goes to the Senate for a vote, where it is expected to pass; the bill is then anticipated to move on to Governor Kate Brown for approval by the end of the week.


Some interesting provisions in the bill are that it alters the typical distribution of State School Funds (SSF) between the two years of the biennium—usually, 49% of the funds are distributed in year one of the biennium and 51% of the funds are distributed in year two; however, HB5017 calls for a 50%/50% distribution—and that 40% of any “new” revenue identified by the June 2015 revenue forecast (released in mid-May 2015) will be allocated to K-12 education in the second year of the biennium (2016-17).


Given our current understanding of how this money will actually be distributed to school districts, here is what the $7.255 billion budget level means to Hillsboro:

  • With changes to the SSF calculation for 2015, which include an addition to the overall number of students in Oregon to be served, and an update to the number of HSD students living in poverty, as well as carve-outs for portions of the overall allocation; in addition to the 50%/50% distribution, Hillsboro would be looking at a break-even budget in 2015-16 and a shortfall of approximately $6.5 million in 2016-17.

    • This assumes that there are no changes to the current Gain Share legislation and that the District would continue to receive a gift of approximately $1.2 million per year from the City of Hillsboro and Washington County.

    • This also does not take into account the cost of capital improvements the District needs to make to accommodate full-day kindergarten (approximately $1 million - $1.5 million).

    • The District is currently bargaining with both its licensed and classified employee groups and the effect of those settlements is still an unknown.

  • Recently received information from the Oregon Department of Education about the revised estimates for the 2013-14 school year (districts receive a final settlement for the previous year in May of the following year) may result in an additional $1.3 million to Hillsboro this year, which theoretically could be banked to help with a shortfall in 2016-17.

  • As a general rule, a 50%/50% split is not beneficial to school districts as costs continue to rise each year.

If the June revenue forecast indeed reflects higher revenue projections and additional money is allocated to K-12 education for the 2016-17 year, that would be helpful to Hillsboro; however, the District’s typical budgeting process calls for approving a budget prior to mid-May, and state law requires school boards to officially adopt a budget by June 30 of each year. 


It is possible that the District will have to develop a budget that assumes making a certain amount of sustainable reductions for the 2015-16 and 2016-17 school years and then revisits those planned reductions once a final allocation amount is known.


Stay tuned to the Budget Matters page of our website for the most current budget-related information.


Superintendent's Message from the April edition of A Look Inside Hillsboro School District

Budget Outlook and Advocacy

April 1, 2015 - Recently, I prepared an op-ed article explaining our budget situation and asking staff, parents, and community members to contact their elected officials to urge their support of an adequate K-12 funding allocation for the 2015-17 biennium.




The proposal currently under consideration from the Co-Chairs of the Joint Ways and Means Committee is a K-12 budget of $7.235 billion, which is $265 million short of what is widely acknowledged as being what school districts across the state need to stay “flat” for the next two years.




Some lawmakers are pushing back on the $7.5 billion number and asking how it could be that districts would need $1 billion more in 2015-17 than was allocated in 2013-15.




Let’s take a look back at some of the realities in place during the 2013 Legislative Session and some of the current realities for the 2015-17 biennium:


  • The K-12 budget approved during the 2013-15 regular session was $6.55 billion. 

  • That allocation meant Hillsboro School District was looking at cutting $8.6 million from its 2013-14 budget, which was on the heels of five straight years of reductions totaling more than $61 million for our district alone.

  • To deal with the shortfall, we transferred $2 million from discretionary reserves, planned for yet another school year with five fewer instructional days, and cut an additional 51 staff positions, among other reductions.

  • Fortunately, the City of Hillsboro and Washington County came through and gave us $1.2 million of their Gain Share funds in the summer of 2013, which allowed us to restore three of the five planned budget reduction days.

  • In September 2013, the Governor called a special session of the Legislature to consider, among other things, a one-time additional allocation to K-12.  In early October, that measure passed and schools were given an additional $100 million, which was distributed in the 2014-15 school year.

  • The K-12 allocation (State School Fund) is typically distributed 49% in the first year of the biennium, and 51% in the second year of the biennium.  So, by distributing the entire $100 million in the second year of the biennium, it was as if there had been an initial biennial allocation of more than $6.8 billion (without, of course, the additional money in 2013-14).

  • For Hillsboro, this additional allocation, plus a continuation of the Gain Share gift from Hillsboro and Washington County, meant that 2014-15 would be our first full school year since 2008-09 when the economy began its decline.  We were able to stop the continued erosion to our staffing ratio (class size), and put some measures in place to begin rebuilding the systems that had been so adversely affected by the huge reductions of the previous years.

  • The 2015-16 school year will be the first in which full-day kindergarten is expected for all districts that have the physical space to accommodate the switch from half-days.  This means that kindergartners who were previously funded at half the rate of students in grades 1-12, will now be funded at the same rate.  It is widely acknowledged that this will cost roughly $220 million statewide in the 2015-17 biennium.

Therefore, if one considers that schools are heading into the 2015-17 biennium already needing more than $7 billion—before taking into account inflation and expected increases to the cost of doing business—simply in hopes of avoiding going backwards yet again, the conversation shifts a bit.


Oregon used to devote nearly 45% of its available General Fund and Lottery Fund dollars to K-12 education.  That was just twelve short years ago.  The 2013-15 allocation represented 39.1% of the state’s available funds and the current proposal of $7.235 billion would take that percentage down again—to approximately 39.1%.  Also, current 2015-16 State School Fund estimates for Hillsboro School District, based on the $7.235 billion allocation and updates to other calculations that go into the algorithm, represent a $66 per student decrease versus our 2014-15 allocation.


Addressing a problem that evolved over the course of several years of disinvestment and economic decline will take more than one legislative session to fix.  However, we need to stop taking our schools backward and remember that even modest increases to the K-12 allocation will not be providing more than schools “used to have,” but, rather, they will be allowing districts to take small steps toward repairing just some of the damage that was done.


We lament that Oregon’s graduation rates are low and that our graduates aren’t as prepared for college and career success as they should be.  This should not be surprising to us since we rank near the bottom of the 50 states in the funding we provide for schools.


Making a true and measurable difference in schools’ ability to provide the experiences students need and deserve to achieve Oregon’s 40-40-20 goal requires funding stability at an absolute minimum, and reinvestment as a reasonable expectation.


An allocation of $7.5 billion for 2015-17 will provide some initial stability to districts.  It also equates to lawmakers funding full-day kindergarten and passing along the same revenue increase the State’s General Fund and Lottery Fund is receiving—9.5%—to schools.    That doesn’t mean reducing class sizes, adding money back to programs, or expanding the number of support staff—it means simply being able to maintain what districts are doing this year for the next two years, while adding full-day kindergarten.


It is not too late to make your voice heard in Salem.  Please take a few moments to tell your story and explain the hopes and dreams you have for your child and other children to the people who represent us.  Look for more information on the Budget Matters page of our website at


    *Note: At press time, there was talk of a 50/50 split for the 2015-17 biennium.  That would simply make our shortfall larger in 2016-17.  Also being discussed was the addition of $20 million to the allocation; however, this additional $20 million would be in “carve-outs” or targeted funds, and would not result in any additional per-student allocation to districts.

    Op-Ed from Mike Scott, Superintendent, Hillsboro School District

    The time for Legislative Advocacy is Now 

    Haga clic aquí para la versión en Español

    Parents and community members asked to write their elected officials and urge a K-12 budget of $7.5 billion to avoid a $4.5 million loss to Hillsboro School District in 2015-16


    March 13, 2015 – Oregon’s Legislators are about six weeks into their full 2015 session, and one of the biggest tasks before them is to pass a budget for the 2015-17 biennium.  Those of us in the education field are hearing there is a desire to pass the education budget early, so that other matters can receive attention.


    We are very appreciative of some early certainty around the budget, as it makes our planning process a little easier; however, the proposal currently on the table from the Co-Chairs of the Joint Ways and Means Committee is a K-12 budget of $7.235 billion.


    When one looks at the anticipated state revenues for the 2015-17 biennium, there is an increase of nearly 9.5% to the total General Fund/Lottery Fund budget.  If K-12 education received that same increase, plus an allowance for full-day kindergarten, it would equate to an allocation of approximately $7.5 billion.


    A K-12 allocation of $7.5 billion is widely acknowledged as being what school districts across the state need to stay “flat” for the next two years.  That doesn’t mean reducing class sizes, adding money back to programs, or expanding the number of support staff—it means simply being able to maintain what they are doing this year for the next two years, while adding full-day kindergarten.


    Oregon is often criticized for having one of the lowest graduation rates in the nation.  However, that should not come as a surprise to us when we are funding our public schools at one of the lowest levels in the nation.  Our outcomes, as a whole, are matching our investments.


    New investments in early childhood education and post-secondary education are exciting and much-needed, but we cannot ignore the years of education we are legally required to provide, and the ones we as a country have agreed are most important to the perpetuation of our democracy—K-12.


    Oregon has disinvested in K-12 education over the past several years—just ten years ago dedicating more than 44% of its General Fund/Lottery Fund to K-12, and now just over 39%.


    While it may not be realistic to expect a return to former spending levels for K-12, with a variety of needs in our state ranging from health care to social services to public safety, we must ask ourselves what the impact will be to our children of continuing to ask more from them while providing them with less.


    If we believe in the importance of education as a way to not only prepare the next generation of citizens and leaders, but also to strengthen our economy, reduce reliance on social services, and to improve communities, we simply must find a way to prioritize our investment in education.


    Hillsboro School District takes pride in the fact that we have managed our finances in a responsible manner over the course of the last several years, thanks to our forward-thinking Board, skilled Business Office staff, and much-appreciated cooperation and partnership with our employee groups.  Though we had to effectively reduce our budget by nearly $70 million between 2009 and 2014, we tried to do so in a way that was sensitive to the needs of our students and maintained the integrity of our programs to the extent possible.


    That we were able to avoid a true crisis is both a good thing and a bad thing.  The good thing is the avoidance of a crisis.  The bad thing is we may have a more difficult time getting the message across that we need to do more for our students.  We know what it will take to raise achievement for all students.  We have been achieving success with our sustained efforts in the areas of standards-based teaching and learning, our Bilingual Program Model, and staff professional development.  We have devised a five-step plan for reinvesting in our system and reaching our goal of having all students graduate ready for success in the next phase of their lives.  But we first need to stabilize our funding.


    I would ask that each of you take just a few minutes of your time to write to your local elected officials and urge them to support a K-12 budget allocation of $7.5 billion for the 2015-17 biennium.  If they pass the $7.235 billion budget, Hillsboro School District will experience a $4.5 million shortfall in the 2015-16 school year, which would equate to cutting 9 school days or 55 teachers.


    We have created a template advocacy letter for your reference, as well as a list of our local elected officials.  Both are available on our Budget Matters webpage.  Please add your personal information to the template letter or write your own and send it to everyone who represents you right away.  There are similar efforts taking place in school districts all around the state. 


    Together, we can make a difference.


    Budget Priorities and Legislative Advocacy

    March 6, 2015

    Hillsboro School District patrons asked to share their priorities as the District plans the implementation of its five-step reinvestment strategy


    As was shared in mid-February, Hillsboro School District has created a five-step reinvestment plan to act as a roadmap for future spending and to get the District to a place where our spending will match our expected outcomes for student achievement.


    Knowing that we may not receive all the funds necessary to carry out full steps of the plan, however, we are seeking input from staff, parents, and other patrons on their investment priorities.  A survey has been created to identify and capture your thoughts.  Please take a few moments to complete the survey and share your priorities with us!  Thank you!


    After completing the survey, please consider writing to your elected officials and urging them to support a K-12 budget of at least $7.5 billion for the 2015-17 biennium.  The current recommendation before the Legislature is $7.235 billion, and spending at that level would mean a $4.5 million shortfall for Hillsboro School District.  This is the equivalent of 9 school days or 55 teachers.  Click the links for a list of our local elected officials and their contact information, and a template advocacy letter (PDF version).


    Budget Information and Five-Step Reinvestment Plan

    February 18, 2015

    Hillsboro would require a statewide K-12 allocation of $7.5 billion to maintain current service level


    Hillsboro School District has been working on its budget projections for the 2015-17 biennium and beyond for quite some time.  And while all projections are updated on an ongoing basis, the immediately upcoming biennium is always the most important. 


    Forecasting is done by estimating “roll-up” costs from the current year and making assumptions about the amount of revenue that will be available to meet those costs.  Simply rolling forward costs from one year to the next, and taking into account expected increases to the cost of doing business, results in what is known as a “current service level” (CSL) budget.


    Last fall, the District estimated that it would need a statewide allocation of at least $7.385 billion for the 2015-17 biennium to maintain CSL.  However, when the Oregon Department of Education delivered its preliminary State School Fund estimate for the 2015-16 year, which considers “carve-outs” (targeted spending) identified in the Governor’s and Co-Chairs’ budget proposals (released December 1, 2014, and January 14, 2015, respectively), as well as student population calculations for the next biennium, it was determined that a statewide allocation of at least $7.5 billion would be needed to maintain CSL.


    Because education funding is so volatile in Oregon, the District wanted to create a comprehensive five-step reinvestment plan to act as a roadmap for future spending.  That way, despite changes in revenue, there would always be a clear vision of where the District needs to go to effect consistent, high achievement levels for all students.


    The plan was initially shared with the Board and Budget Committee at their work session on Tuesday, January 27, 2015.  Additional materials to help explain the District’s budget situation and the reinvestment plan were subsequently created, and are now available on the District’s website on the Budget Matters page.


    This information will be shared with staff and community members throughout the spring.  In addition, a document is being created to help capture patrons’ input on what the immediate spending priorities should be, so the District can begin progressing toward the first step in the reinvestment plan.


    Click the links below for additional information:

    Budget Presentation

    Budget Planning and Advocacy One Pager

    Five Step Reinvestment Plan

    Five Step Reinvestment Plan High Level Overview

    Five Step Reinvestment Plan Ideal Elementary

    Five Step Reinvestment Plan Ideal Middle

    Five Step Reinvestment Plan Ideal High

    2015 Legislative Priorities Brochure

    2015 Legislative Contact List

    Board Approves Issuance of Pension Obligation Bonds

    January 28, 2015

    The District has an unfunded actuarial liability (UAL) with the Oregon Public Employees Retirement System (PERS), totaling $39.86 million, as of December 31, 2013.


    In 2005, the District issued pension bonds to pay off the PERS UAL at that time. The proceeds from the bonds were placed in a side account at PERS to offset future rate increases. Through 2013, these pension bonds have saved the District nearly $23 million.


    The District now has an opportunity to refinance what remains of the UAL in hopes of saving additional money in the future. At their meeting on Tuesday, January 27, the Board approved the refinancing by a vote of 6-1. The District's projected savings from the issuance of pension obligation bonds is approximately $10.4 million over the life of the bonds. 


    Initial Education Budget Proposals for 2015-17

    January 16, 2015

    Governor’s and Co-Chairs’ K-12 allocations would mean a shortfall in HSD


    In Oregon, the statewide budget is determined in odd-numbered years for a two-year span of time (biennium).  That means elected officials will be discussing and passing a budget for the 2015-17 biennium in the session that begins on February 2, 2015.


    Governor Kitzhaber released his budget proposal on December 1, 2014.  In it, he called for a K-12 allocation of 6.914 billion, which included $220 million for full-day kindergarten.  Then on Wednesday, January 14, 2015, the Co-Chairs of the Joint Ways and Means Committee released their budget framework, which identified $7.235 billion for K-12 education, including full-day kindergarten. 


    Hillsboro School District built its budget projection for the biennium assuming an allocation of $7.385 billion.  At this level, the District would be able to maintain current service level and offer full-day kindergarten at all 25 of our elementary schools.  If the Co-Chairs’ budget were to be passed, HSD would experience a $2.4 million shortfall in 2015-16 and a $3.9 million shortfall in 2016-17.


    Our Board of Directors will be voting on the adoption of a set of legislative priorities for the 2015 session at their January 27 meeting.  The top priority in the draft document is stable and adequate funding for K-12 education.  Stay tuned to Hot News and our website for updates on the budget process, both at the state and district level.


    Board Adopts 2014-15 Budget, Saves Taxpayers $6.5 Million by Refinancing Debt

    At their meeting on Tuesday, June 24, 2014, the Hillsboro School Board unanimously* adopted the 2014-15 budget, which adds $6.2 million for hiring teachers, providing additional classified support, and adding one instructional day back to the calendar, among several other things.  (*Director Cañas was not present at the meeting; the vote was 6 yes, 0 no to adopt the budget as presented.)


    In the same motion, they set the Permanent Tax Rate (property taxes for education) to support the General Fund, and set the Debt Service Levy amount (additional taxes to pay off previously approved bonds) to support the Debt Service Fund.


    Notable is the Debt Service Levy, which is higher than initially proposed due to an opportunity to refinance a portion of the District’s outstanding bond debt at a significant long-term savings to taxpayers.  When taxpayers approved the District’s last bond in 2006 for the construction of new schools, those bonds were sold in two series: Series 2006A and Series 2006B.  The Series 2006B bonds are structured as “callable deferred interest bonds,” so they may be prepaid prior to their maturity dates, which are currently in 2025 and 2026.  Refinancing those bonds now will save taxpayers approximately 34% or $6.5 million in net present value (NPV), and can be accomplished while keeping the total bond levy rate stable for the next four years.


    “It is very exciting and rewarding to adopt a budget that begins to restore funds to our system,” notes Board Chair Kim Strelchun.  “Having the opportunity to refinance outstanding bond debt to save taxpayers money is another bonus—it shows the District’s fiscal responsibility and provides predictability to our community over the next four years.”


    (Click here to see more information about the bond refinancing.)


    Board Approves 2014-15 Calendar Change, Will Postpone Budget Adoption

    At their meeting on Tuesday, May 27, 2014, the Hillsboro School Board unanimously approved a revision to the previously adopted 2014-15 school calendar to restore Friday, March 20, 2015, as an instructional day.

    When the District was budgeting for the 2013-14 school year and looking at forecasts for the biennium, it was considering negotiating with the licensed employee union to achieve five furlough days in each of the 2013-14 and 2014-15 school years to make up for anticipated budget shortfalls.  However, Gain Share money received from the City of Hillsboro and Washington County allowed the District and union to agree to just two furlough days each year.


    Over the course of the winter and spring of this year, the cumulative effect on the District’s 2014-15 revenue—as a result of last fall’s Legislative Grand Bargain, a revision to the poverty calculation for schools, and updates to the 2012-13, 2013-14 and 2014-15 State School Fund estimates—became clearer.  By mid-April, calculations indicated the District would have revenues that were $6.2 million in excess of expenditures.


    On Thursday, May 8, the Hillsboro School District Budget Committee, composed of the Hillsboro School Board and an equal number of appointed citizens, unanimously approved the 2014-15 proposed budget, which included allowing the District to add back one of the two furlough days to the calendar, hire teachers, and provide additional classified support, among several other things.*  That night, they also set the Permanent Tax Rate (property taxes for education) to support the General Fund, and set the Debt Service Levy amount (additional taxes to pay off previously approved bonds) to support the Debt Service Fund.


    The following week, the District was contacted by its underwriter about an opportunity to refinance a portion of the District’s outstanding bond debt at a significant savings to taxpayers.  When taxpayers approved the District’s last bond in 2006 for the construction of new schools, those bonds were sold in two series: Series 2006A and Series 2006B.  The Series 2006B bonds are structured as “callable deferred interest bonds,” so they may be prepaid prior to their maturity dates, which are currently in 2025 and 2026.  Refinancing those bonds now will save taxpayers approximately 34% or $6.5 million in net present value, and can be accomplished while keeping the total bond levy rate stable for the next four years.


    To satisfy procedural guidelines around actions of the Budget Committee and public notification in advance of the Budget Hearing, the District will reconvene the Budget Committee on Tuesday, June 10, to discuss the refinancing option and corresponding new Debt Service Levy amount, and then will announce that the Budget Hearing will take place on Tuesday, June 24.


    Board Ratifies Agreement with Teachers, Adds Three Days Back to Calendar

    At their first meeting of the 2013-14 school year on Tuesday, July 23, the Board voted unanimously to ratify the tentative agreement with licensed staff and add three of the proposed five budget reduction days back to the school calendar.


    The District has been negotiating with the teachers’ union, Hillsboro Education Association (HEA), since December 2012 for a successor collective bargaining agreement to the one that expired on July 1, 2013.  On July 15, 2013, the District bargaining team reached a tentative agreement with HEA for a new three-year contract.  The main points of the tentative agreement are as follows:

    • 2013-14
      • Step movement for eligible employees.
      • Eliminate current Step 2 of the salary schedule and create a new top step that is 2% higher than the current top step.
      • Two budget reduction days: November 27, 2013 and March 21, 2014.
    • 2014-15
      • Step movement for eligible employees, beginning with the 5th paycheck of the year.
      • Addition of 2% to the new top step of the salary schedule, making it a full step.
      • Two budget reduction days: to be identified.
      • Addition of $25 to the insurance cap, raising it from $1,050 to $1,075.
    • 2015-16
      • Salary and insurance re-opener to coincide with the new biennium.

    There were also several changes to the language of the contract, including the District’s ability to transition to electronic personnel files and the addition of four hours for elementary fall conferences.  For more information on the language changes, please see pages 61 and 62 of the Board Packet.


    The initial budget proposal for 2013-14 included five budget reduction days to help address the District’s revenue shortfall.  On June 6, Washington County Board of Commissioners Chair Andy Duyck and Hillsboro Mayor Jerry Willey held a joint press release at which they indicated their willingness to devote $10 million of their Gain Share* money for the next biennium to Washington County Schools.  Hillsboro’s portion of that allocation will be approximately $1.2 million in 2013-14.


    Gain Share money, in addition to a portion of the savings from licensed staff retirements, was used to add three of the five proposed budget reduction days back to the calendar.  The remaining savings from licensed staff retirements, along with delayed step movement in 2014-15, was used to pay for the creation of a new step on the salary schedule and add to the insurance cap.  Therefore, all changes were affected within the previously-budgeted amount for licensed staff in 2013-14 and 2014-15—a great result.


    The District is extremely grateful to the City and County for their willingness to devote Gain Share money to schools.  Maximizing our students’ instructional time is of the utmost importance.  Students will now be in school 173.5 days in 2013-14 (172 for elementary students).  Oregon’s guideline for number of school days is 175, which is approximately 4 days short of the national average of 179.  Thanks are also in order for all members of both the District’s and HEA’s bargaining teams for the hard work, dedication, and spirit of collaboration with which they approached negotiations. 


    *Gain Share is money that local taxing authorities receive back from the state as a result of tax abatement agreements with large employers.  In Hillsboro, both Intel and Genentech have entered into Strategic Investment Program (SIP) agreements with the City and County, allowing them to pay less money in taxes in exchange for their significant investments in their physical plants.  The income tax collected from employees who are new to those companies as a result of the investment is held separately by the state—half is kept at the state level, and half is returned to the local taxing authorities.  For more details, please see the information sheet on Washington County’s website.



    Budget Committee Approves 2013-14 Proposed Budget


    Use of $2M in discretionary reserves will save teaching positions


    At its meeting on Thursday, May 9, the Hillsboro School District Budget Committee approved the proposed budget for the 2013-14 school year.


    The Committee, which is composed of all seven members of the School Board and an equal number of appointed citizens, listened to information presented by administration and asked questions over the span of more than two hours before voting unanimously to approve the budget and impose and categorize the tax rate as defined by law.


    As presented, the Proposed 2013-14 Budget did not include the use of any discretionary reserves to help fill the $8.5 million gap between revenues and expenditures.  However, after reading his budget message, Superintendent Scott, acting on feedback and suggestions received from members of the Budget Committee, recommended that instead of using $2 million of discretionary reserves toward completing high-needs facility maintenance projects, those projects instead be paid for out of Construction Excise Tax (CET) funds, and that the $2 million from reserves be used to offset increases to the staffing ratio—which had been proposed to go up to approximately 31:1 with a loss of 38 full-time equivalent (FTE) licensed positions.  The $2 million infusion will save approximately 22 FTE licensed positions, for an overall loss of approximately 16 FTE licensed positions due to increases in the staffing ratio (commonly referred to as class size).  The other recommended reductions to licensed staff, totaling 12.2 FTE will not be affected; therefore, the total proposed licensed FTE reduction is 28.2 (down from 50.2).


    Human Resources will now revise staffing allocations accordingly and re-release those to schools. 


    The School Board still needs to adopt the Approved 2013-14 Budget; this is anticipated to occur at their June 11 meeting.  It should also be noted that the Legislature has not yet approved the 2013-15 K-12 budget, which could come in at, below, or above the $6.55 billion number our proposed budget was based on.  In addition, the five furlough days included in the proposed reductions still have to be bargained with our licensed employee union.


    2013-14 Draft Budget Information Shared

    Approximately 35 people were in attendance at the Listening Session at Brown Middle School on Thursday, April 25, to hear Superintendent Scott explain the projected budget realities for 2013-14. Click here to see the presentation he shared.

    At an assumed statewide K-12 funding allocation of $6.55 billion for the 2013-15 biennium, along with $200 million in PERS employer rate reductions, Hillsboro School District is looking at a gap between revenues and expenditures of nearly $8.2 million next school year. This will be the sixth straight year of cuts for the District, which has reduced $61.3 million from its General Fund budget since 2008-09 to deal with shortfalls.

    A list of the recommended reductions is available here. It is likely with this proposal that the District will go into layoffs; the full extent of the layoffs will not be known until all resignations and retirements have been received and Human Resources has a chance to determine staffing implications.

    The public is reminded that the Legislature has not yet finalized the budget and there is still time to advocate for additional K-12 funding. Please contact your elected officials to let them know your position on educational funding.


    Join Superintendent Scott and our Local Elected Officials for an Education Town Hall 3/21


    Join Representatives Ben Unger and Joe Gallegos, Senator Bruce Starr, and Superintendent Mike Scott for an Education Town Hall on Thursday, March 21, from 7-8pm in the Century High School Lecture Hall (2000 SE Century Blvd., N225).  Learn more about the progress of the 2013 Legislative Session, bills that would affect education, and current thinking around the statewide K-12 budget allocation for 2013-15.  Questions will be taken via lottery system; Spanish translation will be provided.



    Sequestration Update - March 8, 2013

    The Oregon Department of Education sent out this update on the status of federal-level sequestration today.  It appears that sequestration cuts of 5% will affect our funding for IDEA (special education), Title 1 (low income) and other programs in the 2013-14 school year if nothing to reverse sequestration takes place in Congress.  If reductions are also made to the funding allocation for these programs (as compared to 2012-13 funding levels), the estimated net effect could be reductions of up to 10%.


    Superintendent Scott Releases Budget Message - March 5, 2013

    Superintendent Mike Scott prepared a message in response to the announcement of the 2013-15 proposed budget by the Co-Chairs of the Joint Ways and Means committee.  The Co-Chairs' budget calls for a $6.55 billion revenue allocation, and an additional $200 million in PERS Employer Rate decreases, for K-12 education.  The proposed allocation would result in a shortfall of more than $8 million in Hillsboro in the 2013-14 school year. 


    Legislative Priority Discussion and Advocacy Training Event

    The 2013 Legislative Session is currently under way. Many bills will be put before elected officials that will either directly or indirectly affect education, so we urge staff, students, parents, and community members to familiarize themselves with the issues, understand where to go to track progress in the session, and know how to advocate if they so choose.


    Legislators from both parties have expressed how important it is to their decision-making process to hear from their constituents, and it doesn’t have to be time consuming or intimidating to do so.


    Please join us on Monday, February 11, from 6:00 to 7:30 p.m. in the Liberty High School library (21945 NW Wagon Way, Hillsboro 97124) to learn more about some of the top education concerns and how to effectively advocate for change.


    Spanish translation will be provided, and patrons from surrounding communities are welcome to attend as well.


    This is a non-partisan, information-only event.


    Hillsboro Holds Legislative Briefing

    On Wednesday, January 9, Superintendent Mike Scott and the Board of Directors held a briefing with local elected officials on the Board’s priorities for the 2013 Legislative session.

    In attendance were Senator Bruce Starr, Representative Ben Unger, Representative Joe Gallegos, Representative Jeff Barker, Hillsboro City Council President Aron Carleson, Washington County Commission President Andy Duyck, Washington County Commissioner Greg Malinowski, Field Representative John Valley (U.S. Senator Jeff Merkley), and Field Representative Ryan Mann (U.S. Congresswoman Suzanne Bonamici), along with several staff, Board, and Budget Committee members.

    Superintendent Scott kicked off the meeting by discussing the Hillsboro School District budget situation and projections for the 2013-15 biennium based on Governor Kitzhaber’s proposed allocation to K-12 education. He then shared the Board’s 2013 Legislative Priorities (to see the full Legislative Priorities brochure, click here or visit the Budget Matters webpage):

    • Support stable and adequate funding for education.
    • Support PERS reforms that are deemed constitutional, lead to long-term stability of the system, and value current, former, and future public employees.
    • Oppose or modify laws, mandates, or reporting requirements that do not come with the corresponding funding for their implementation.
    • Revise legislation that places an undue or unreasonable burden on public schools.
    • Support education funding at the federal level that aligns with mandated program delivery.

    Finally, a brief discussion ensued around effective advocacy efforts. The elected officials in attendance agreed that the two most effective elements of advocacy are a common message, and personal stories from constituents.

    The advocacy sub-committee, led by Communications Director Beth Graser, will be scheduling some information and training events in the coming weeks for parents, community members, and even staff who are interested in learning more and taking an active role in advocating for education in this legislative session. Stay tuned to the website for more information, or feel free to contact Beth directly via e-mail or phone: 503-844-1772.

    Superintendent Budget Message 12/6/12

    Following the December state revenue forecast and release of Governor Kitzhaber's budget for the 2013-15 biennium, Superintendent Mike Scott prepared a budget message for staff, parents, and community members.  The message outlines the Governor's proposal for K-12 education and what it would mean to the Hillsboro School District.

    Board Adopts Priorities for 2013 Legislative Session

    At their meeting on Tuesday, November 27, the School Board adopted five priorities for the 2013 Legislative Session: Funding—Support stable and adequate funding for education; PERS Reform—Support PERS reforms that are deemed constitutional, lead to long-term stability and sustainability of the system, and value current, former, and future public employees; Unfunded Mandates/Reporting—Oppose or modify laws, mandates, or reporting requirements that do not come with the corresponding funding for their implementation; ORS Restrictions—Revise legislation that places an undue or unreasonable burden on public schools; and Federal-Level Advocacy—Support education funding at the federal level that aligns with mandated program delivery.  These priorities will become working tools for conversations with elected officials from the Hillsboro area, and with legislative leaders in key committee assignments and leadership roles at the state and federal level.  The use of consistent priorities also makes it possible for individual Board members to participate in the process while maintaining a common voice with their fellow Directors.  Additional details are available in the 2013 Legislative Priorities document.


    Board Adopts 2012-13 Budget, Tables Local Option Levy Ask

    At its meeting on Tuesday, June 12, the School Board officially adopted the budget for 2012-13, which included a previously unexpected additional $852,271 from the state, and agreed that a local option levy should not be placed on the November ballot.

    News of an additional disbursement of over $852K to the Hillsboro School District came just one day after the Budget Committee unanimously approved the Proposed Budget for 2012-13 in May. The money was a result of revised estimates to the 2011-12 State School Fund in three areas:
    1. Additional allowances for the number of students above the 11% cap receiving special education services;
    2. Additional allowances for students in Foster and Neglected Delinquent Care; and
    3. An addition to the per-student (average daily membership—weighted, or ADMw) disbursement due to declining enrollment in the state.
    The additional funds were used to restore ten elementary teaching positions, which brought the average staffing ratio at elementary schools down from 30.6:1 to 29.8:1. These additional funds, along with response to an early retirement incentive and contract concessions from licensed staff members, a reduction of classified hours across the District, five reduced days from the 2012-13 calendar, and other reductions, allowed the District to balance its budget without laying off any non-temporary licensed employees. In addition, all classified employees were offered positions. This is an amazing result given the many years of consecutive budget reductions the District has faced as well as the dire situation districts around us are facing, and is a testament to the hard work and collaboration of all staff and Board members.

    Prior to the regular session, Board members heard a report from consultant Rebecca Ball of DHM Research Associates on the results of a public opinion poll conducted to assess potential support for a local option levy ask in November 2012. The firm placed over 10,000 calls in the span of three days in late May to complete 300 twelve-minute phone surveys of registered voters who closely match the demographics that would be expected to turn out in our area during a presidential election.

    The poll showed that just 51% of people would vote for a local option levy if the election were held today, while 43% would vote against, and 5% were undecided.

    Additional questions revealed that a majority of people who indicated they would vote against the levy would do so because of personal financial concerns—they are against property taxes in general, have too many taxes, or don’t feel they could afford it. They also revealed that a majority of all voters are generally supportive of public education and are concerned about the financial situation our District faces. Finally, they indicated that people would like more information about how the District manages its finances and how any additional money would be spent before making a final decision about whether or not to support a local option levy.

    Given those results, the knowledge that November will have a very crowded ballot, and that there is typically a “sucking effect” of support for ballot measures that increase taxes as elections draw nearer, the Board agreed with staff’s recommendation not to move forward with a local option ask at this time. They also agreed that a committee of staff, Board, and other interested parties should convene to strategize on how to better communicate with our community on the issues surfaced by the survey. If you are interested in participating on the communications committee, please contact Communications Director Beth Graser via e-mail or by calling 503-844-1772.

    Budget Committee Approves Proposed Budget on May 10, 2012

    The Budget Committee, which consists of all members of the School Board and an equal number of appointed citizens, met for their official review of the 2012-13 Proposed Budget on Thursday, May 10, at 7:00 p.m. in the Administration Center Board Room.  After electing a Budget Committee Chair, Helen Noonan-Harnsberger, the Committee heard the Budget Message from Superintendent Mike Scott, and an explanation of the information contained in the Proposed Budget from Chief Financial Officer Adam Stewart.

    Prior to the meeting, Adam and his team received several questions about the Proposed Budget and provided answers, but there was also time during the meeting for additional questions and discussion.

    Most of the discussion centered around the inadequacy of funds available for K-12 education throughout the state, an acknowledgement that we are trying to select the best of bad choices, recognition that the forethought and conservatism of past Boards has allowed us to mitigate the effects of continually declining revenues, and a desire to start the budget planning process even earlier next year and engage in tough conversations about what we will be able to provide to students moving forward.

    The Budget Committee approved the Proposed Budget unanimously.  The Proposed Budget will now advance to the Board for an adoption vote on Tuesday, June 12, 2012; that meeting will begin at 7:30 p.m. in the Administration Center Board Room and is open to the public.  To see the detailed list of cuts for 2012-13, please click here.

    Licensed Staff Negotiations Could Help With Budget Gap for 2012-13

    A tentative agreement was reached with our licensed bargaining unit on Thursday, April 5.  That agreement has various components, but the most pertinent ones for the purpose of discussing necessary budget reductions for 2012-13 are the provisions for five reduced calendar days (already reflected in the adopted 2012-13 calendar) and a delayed implementation of step increases on the salary schedule for licensed staff members who are eligible.  Those items, if passed by the licensed membership and approved by the Board on April 24, will result in the following savings:

    Savings from 5 day reduction - Licensed staff:      $1,608,469
    Savings from delayed step - Licensed staff: 1,398,000
    Savings from 5 day reduction - Classified: 539,366
    Savings from 5 day reduction - Administrative & Supervisory/Technical  ___185,735



    In addition, the budget for our online school, Hillsboro Online Academy, was revised to reflect a District contribution of just $125,000 instead of $200,000.  That $75,000 savings, added to the above, brings the total adjustment to our budget gap to $3,806,570, leaving a remaining gap of $4,343,430 for the Board and Budget Committee to consider.

    Community Budget Meetings Being Held at Each School

    As the spring has progressed, the District has gotten clearer about its budget deficit for the 2012-13 school year—$8.15 million.

    In early February, all eyes were on the state’s March revenue forecast (released February 8) and the first even-year session of the Legislature for cues about the state of the budget.

    The revenue forecast was down $35.1 million, which brought the total shortfall since the close of the regular legislative session in 2011 to $341.1 million. Since $460 million had been set aside by the state to absorb those shortfalls, the Legislature determined no further reductions to K-12 budgets were required for this school year; as long as the next five revenue forecasts of the biennium (ending June 30, 2013) don’t exceed that $460 million cushion, K-12 schools can be reasonably assured they will receive the money that was allocated to them for the biennium.

    Based on that information, the District calculated the gap between anticipated revenues and expenditures for the 2012-13 school year to be $7.65 million. We also know we need to spend $200,000 on our new online school, Hillsboro Online Academy, and $300,000 for technology replacement in our schools, which brings the total shortfall in Hillsboro to $8.15 million.

    District staff have been sharing information about the budget gap with our Board, Budget Committee, and principals, and our principals are now sharing information with their staff, parents and community members. We want to make sure all our patrons understand the state of the budget and have an opportunity to share their thoughts on system values and priorities as we endeavor to make reductions in the most responsible, sustainable way possible.

    For more information and to see a list of school-based budget meetings, please review the presentations, FAQs, and other documents on this page.  Please also plan to attend our upcoming Superintendent Listening Session on Thursday, April 19, 6:15-8:30 p.m. at Poynter Middle School (1535 NE Grant Street, Hillsboro).
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