Sumter School District finances, teacher bonuses tabled for now

A "wait-and-see approach" on employee bonuses given budget unknowns in the pandemic will be the direction for Sumter School District's Board of Trustees moving forward.

With a unanimous vote by the full board on Monday, trustees agreed to postpone any vote on teacher and staff bonuses for the time being after administration again detailed possible budget scenarios, including across-the-board cuts in revenue from the General Assembly.

South Carolina lawmakers have not discussed state revenue reductions to date, but the district is preparing for worst-case scenarios.

The district's budget projects a 5% state revenue reduction, lowering district coffers by $3.7 million this year.

District Superintendent Penelope Martin-Knox said in a meeting last week with other superintendents the budget conversation came up again, and most are taking a "wait-and-see approach."

Several "budget unknowns," to include a state revenue reduction, could dip the district's fund balance to $10.3 million if it paid out a $500 bonus to all employees at this time, according to administration. That is below a one-month threshold state requirement of $10.5 million. The district's current fund balance is $25.4 million.

Unlike the vast majority of districts, Sumter has been on a "fiscal emergency" declaration before, and - even though it was removed in January 2020 - the state Department of Education maintains that any financial activity this year that pushes the district below the one-month requirement would result in Sumter being placed back on "fiscal emergency."

That makes the district's situation now somewhat unique from other districts, Martin-Knox and district Chief Financial Officer Jennifer Miller have said.

District student enrollment is also down about 2.8%, according to fall semester counts, meaning likely at least $1 million less in per-pupil funding from the state if that reduction holds true this spring. Statewide, public school enrollment is down 2.5% for the 79 traditional school districts in 2020-21, according to state Department of Education totals.

Martin-Knox said a "very cautious" approach with bonuses is best at this time.

"Until there is something in writing that says we are not going to have a fiscal impact," she said, "and we know where our student count is in terms of our per-pupil allocation, again, it would be in our best interest from my professional opinion to not move in this direction at this time."

The superintendent added it's not a question of if all employees deserve a raise or bonus, given extra workload in the pandemic, because they do. The budget unknowns are just too many in the pandemic, she said.

"It's not that we definitively know where the reductions are going to occur," Martin-Knox said. "We have given the scenarios and the possibilities. … I would prefer to exercise caution in moving forward, and as I have said and will continue to say, 'I know our team, our staff, our workers - from teachers to building services to facilities - they all deserve a raise or a bonus. There's no question.' The question is: When is the appropriate time to do it? And from my professional opinion, now is not the time to do that."

The superintendent added the district has not laid off any employees in the pandemic, while other districts have. That has created additional expenditures, but it is an investment in human capital.

In other matters at the meeting, the board approved second reading of various policies, including a state School Boards Association Policy and Legislative Manual update.