By Deb Risden
In a 4-1 majority vote, the El Paso County Board of Education approved a statement of fiscal exigency at its Jan. 16 regular meeting. The statement directs the superintendent to reduce the budget for the 2026-27 fiscal year by $2.8 million in teacher salaries and benefits, as well as the cancellation of one or more teacher contracts.
Peter Hilts, District 49 superintendent, said there are multiple reasons for the budget shortfall; the district has been preparing for the possibility of budget cuts for a few months. Hilts pointed out both reductions in revenue and increases in costs through the following:
- Decline in the operated school (not charter schools) enrollment by about 3% over the past five years
- Transition to a new school funding formula with yearly unpredictable variations
- Defunding of the mill levy equalization program at the state level. “Although the program still exists, it has zero dollars in the state budget,” Hilts said. “That’s a program District 49 was a recipient of and it was multiple millions of dollars for the three years that we received it.”
- Increase in employee compensation, health care expenses and overall inflation
Hilts said District 49’s expense profile consists of 83% salaries and 17% other expenses. About 14% of other expenses are fixed or other costs that are not easily controlled, such as utilities and diesel fuel. “The margin of what we can take action on is incredibly narrow, just under 3%,” Hilts said.
“Our condition is severe enough that we are contemplating cutting services and individual positions that we really value, that we know add value.” The District 49 administration is identifying potential cuts in five areas:
- Administration staffing (position eliminations, consolidations and contractions)
- Supplemental programs (events and projects that are less mission-critical)
- Renegotiating contracts (already in process with some contracts reduced or cancelled)
- Supplemental support staffing (intent-not-to-renew positions and probationary positions)
- Non-core teaching (both academic and elective positions)
Hilts said school districts are required to maintain a balanced budget, but only some reserve funds are available to backfill budget deficits, and some are not. For example, mill levy override (MLO) funds are shared with the district’s charter schools on a reimbursement basis. “It would be unethical to spend their money for our purposes. We hold it in trust,” Hilts said. Also, there are capital construction reserves that have been granted for specific purposes and they must be held in reserves.
“When you subtract the required reserves from the total fund, that leaves a portion that can be applied to the budget. In the current year, we applied $9 million into our general fund to balance the budget,” Hilts said. That leaves $2 million for contingency.
The district’s workforce consists of about 44% education support professionals, 26% non-probationary teachers, 18% probationary teachers, 5% special service providers (counselors, school psychologists and others with specialized licenses) and 7% administrative and professional/technical.
Hilts said a planned reduction will be the least impactful on education support professionals, non-probationary and special services providers. Special services providers are least impacted because they serve students with IEPs (Individualized Education Program) or those covered by federal regulation requiring the district to maintain funding for special education.
Under the statement of exigency, the BOE is not approving any cancellation of individual contracts or reduction in workforce. Rather, the statement gives a directive to district administration to prepare a plan to be approved by the BOE.
Hilts said there have already been a number of leadership positions that have not been filled from vacancies and some that will be eliminated prior to the end of the fiscal year.
“We feel the people whose names would be on that list deserve to know sooner rather than later. There will be people impacted by this reduction who will turn right around and apply for non-RIF positions that become vacant,” Hilts said. “We know some of our colleagues will find other landing spots in the district and we welcome that. The sooner we move, the less likely it is that those people will feel compelled to seek employment elsewhere. If they are compelled to seek employment elsewhere, we want to give them the earliest start into that labor market that we can.”
Mike Heil, BOE treasurer, said, “I want everybody to understand that we got into this situation in part because of this board. We approved some pretty aggressive changes in teacher compensation and that’s the kind of thing I came onto this board to do. I came here in a climate where our teachers and our administrators were basically under attack. They were demoralized. They were fleeing the district. I came here to support the people who support our students. I voted in favor of those increases knowing that we were flying pretty close to the sun and that we needed positive trends in funding to continue funding those. And things turned against us pretty quickly.”
Heil pointed out that there is no proposal to freeze salary increases or backtrack on the repositioning project. “To take those things away would just be devastating to everybody,” Heil said. “So this proposal is more targeted.”
