SLO County schools may lose millions in funding after enrollment drop during COVID
San Luis Obispo County’s largest school districts saw steeper declines in enrollment for this school year compared to years past — and this drop in students may mean losing millions of dollars in state funding for most of the districts.
District officials chalked up the accelerated enrollment decline to the COVID-19 pandemic that caused unemployment rates to temporarily skyrocket — which likely forced some families to move out of the area to find more affordable housing — and parents transferring their kids into home school programs or private schools
It’s a statewide problem.
In California, enrollment at schools serving students in kindergarten through 12th grade dropped by a record 155,000 students this year, or about five times greater than the state’s annual rate of enrollment decline in recent years, according to the California Department of Education.
San Luis Obispo County school districts are flush with COVID-19 relief funding from the state and federal governments. But those funds are one-time and must be spent before they expire.
District budgets have not yet felt the full weight of the enrollment drop because the California Legislature’s 2020 budget included a “hold harmless” provision that protected districts with declining enrollment. This allowed districts to calculate their attendance-based funding on 2019 enrollment numbers, which were higher.
When the 2022-23 school year begins, though, local school districts may see themselves jumping off an “enrollment cliff” — as Jim Empey, assistant superintendent of business services at Lucia Mar Unified School District, called it.
Should none of the students who disenrolled in local school districts return, then districts may be facing a revenue reduction of several million dollars.
SLO County school districts see steep drop in enrollment
For school districts in San Luis Obispo County, losing one kid typically translates to a loss of roughly $10,000 in state funding.
“The big difference between last year and this year was we started 200 kids lower this year,” said Brad Pawlowski, assistant superintendent of business services at Paso Robles Joint Unified School District. “That’s a significant drop. So with 200 fewer kids, that would have been $2 million lost.”
The Paso Robles district saw an enrollment decline of about 208 students for the 2020-21 school year.
Lucia Mar saw the biggest enrollment drop among San Luis Obispo County districts — losing 344 students. Atascadero Unified School District had 226 fewer students this school year, and San Luis Coastal Unified School District had an overall drop of 92 students.
Compared to previous school years, this drop in hundreds of students at most districts is drastic.
From the 2018-19 school year to 2019-20, the Paso Robles school district gained 25 students, while Lucia Mar lost 98 students, Atascadero Unified lost 100 students and San Luis Coastal saw a drop in 43 students.
San Luis Coastal will not be negatively impacted by the drop in enrollment because it’s funded by local property taxes, which exceed what it would receive from the state in average daily attendance funding from the Local Control Funding Formula, the legislation that dictates how school are funded.
What caused the drop in enrollment?
The sharp decline in average enrollment during the 2020-21 school year can be attributed to the COVID-19 pandemic and its effects on the local economy, according to district officials.
Schools rely on lots of families living in their area to send kids their way. But when these families can no longer afford the rising costs of living in San Luis Obispo County, they move away.
This problem was exacerbated by the novel coronavirus.
Unemployment hit 14% in San Luis Obispo County in April and is now at 6.7%, according to the most recent data available from the California Employment Development Department.
Before the pandemic hit, unemployment in San Luis Obispo hovered at around 3%, according to the California Employment Development Department.
“Even in pre-pandemic times it was expensive to live here,” Empey said. “The median cost of housing is what, $700,000? Plus, it’s hard to find jobs.”
Additionally, restrictions brought on by the COVID-19 pandemic forced schools to close campuses and transition to solely online learning modalities.
When those restrictions began to loosen, small private schools were able to reopen due to the simple fact that they have fewer students, while larger public schools and their teachers unions had to find ways to keep hundreds of students, teachers and staff safe during in-person learning.
“We’ve seen some of our students go to private schools or parochial schools because those schools have had some more flexibility when it comes to having in-person instruction,” Pawlowski said.
This is backed up by the increase in the number of private school affidavits filed in San Luis Obispo County. An accepted affidavit from the California Department of Education allows parents to operate a private school out of their home or for new private school programs to be established.
According to the California Department of Education, 589 private school affidavits were filed with the state in San Luis Obispo County as of March 1. That’s compared to 446 during the 2019-20 school year, and 217 in the 2018-19 school year.
Anecdotally, local private schools and homeschool programs say they’ve seen interest in enrollment skyrocket during the COVID-19 pandemic.
San Luis Obispo County public school officials are optimistic that the students who disenrolled in the 2020-21 school year will come back for the following school year.
Empey said he estimates that about half of the students at the Lucia Mar district may return next year.
Paso Robles Joint Unified School District Superintendent Curt Dubost said he’s optimistic some will return, but it will depend on how the local economy is faring as well.
State, federal COVID-19 relief funds help districts save money
COVID-19 relief funds from the state and federal governments have immensely helped local school districts during the pandemic.
Schools were able to save general fund dollars while spending relief funding from the government on things such as personal protective equipment and new sanitation measures to keep employees and students safe, as well as learning loss mitigation efforts to help students who struggled with distance learning.
“We can now use these COVID monies as a way to lower general fund expenses because we’re using the COVID monies to enhance all our interventions,” Empey said, citing summer school as one example of a learning loss intervention the district, like others in the county, is offering.
But the COVID-19 relief money is one-time funding, and ultimately all of it must be spent by the end of September 2023 at the latest.
“So when that does run out, then there’s no longer any increase to the (district’s) ongoing revenue projected at this point,” Pawlowski said.
That means districts such as Paso Robles Joint Unified will have to continue to find ways to cut expenses, Pawlowski said, which often comes in the form of reducing salary expenses through staff attrition.
“All of the loss (in students) is definitely going to be a challenge for us down the road,” Pawlowski said.
“If things stay status quo on our spending, we would deficit spent about $2 million” in the 2022-23 school year, he added. “But we have to keep in mind that we know that we’re going through declining enrollments, so we’ll have to make adjustments on our staffing expenditures to compensate for that.”
This story was originally published March 26, 2021 at 10:50 AM.
CORRECTION: This article initially indicated that a school district typically loses about $10,000 for every 10 students who disenroll. It was corrected to $10,000 for every student who disenrolls.
