St. Joseph School District by the Numbers: Part II

June 8, 2015

By Brittany Clingen
This article is the second in a two-part series that takes an in-depth look at data from the St. Joseph School District in order to put into context the extent of the corruption that occurred there. The first article addresses student performance metrics.

St. Joseph school board member Chris Danford distinctly remembers her reaction to former Missouri Auditor Tom Schweich's (R) revelation that her school district had distributed up to $40 million in unapproved stipends over the past 14 years.

St. Joseph school district building

"I was stunned. I hadn't, we [as a board] had not seen those numbers," she recalled. "We saw that there was 3.3 million for years, but I guess I didn't add all those numbers up. And when you consider the sheer size of that, that's huge. It was overwhelming." Forty million dollars is a sizable sum, raising the question: Just how consequential is this number, given the district's finances?

The district's total revenues increased by 8.3 percent from 2011 to 2014 despite a significant decrease in local revenues as a share of the budget. Property taxes, county aid and other sources of local revenue as a share of the budget declined by 10 percent over the highlighted period. The loss of local revenue sources has been offset by a 7.1 percent increase in state aid and a total of $48.6 million in other revenue sources from 2012 until 2014. St. Joseph's total revenue for the 2014-2015 school year was $132,150,329.

On the other end of the balance sheet, the district's total expenditures increased 20.8 percent from 2011 to 2014, meaning expenditures increased at a rate more than twice that of revenues. The increase in expenditures was largely due to rising operational expenses and debt service payments. Operational expenses grew as a share of the district budget by 323.5 percent during the highlighted period. Debt service payments as a share of the budget also increased by 46.5 percent from 2011 to 2014. In other words, administrators were handing out millions of dollars in stipends and bonuses while running up additional debt.

Over the past four school years, the category of staff expenses, which is composed almost entirely of employees' salaries and benefits, was by far the largest percentage of expenditures, consuming an average of 67 percent of the budget during this time period. Operational expenses took second place, with a four-year average of 17 percent, followed by student services at 14 percent. Rounding out last place was debt service, accounting for an average of just 3 percent of annual expenditures.

Teachers in the St. Joseph School District earn annual salaries based on years on the job, as well as educational achievement. The salary schedule accounts for graduate degrees by providing higher starting salaries and greater potential salaries. For the 2013-2014 school year, the minimum salary a teacher could earn was $34,200, if the teacher held only a bachelor's degree. A teacher could make up to $58,280 if he or she held a master's degree plus an additional 48 graduate hours.

From 1991 to 2014, the number of district administrators in St. Joseph rose from 36.7 full-time equivalent (FTE) employees to 46.6, an increase of 27 percent. Both full- and part-time administrators are included in this calculation, which is "determined by calculating the ratio of hours worked by part-time personnel over the statutory hours worked by a full-time employee during the school year."

The average administrator salary increased by 91.4 percent, starting out at $45,497 and rising to $87,092 by 2014. Additionally, the total amount spent on administration by the district rose significantly, from $1,668,379 in 1991 to $4,057,632 by 2014, an increase of 143.2 percent. Meanwhile, over the same time period, student enrollment has been decreasing, experiencing a 6.3 percent decrease in enrollment between 1991 and 2014. In 1991, the district had a total of 12,265 students enrolled; this number dropped to 11,493 by 2014.

St. Joseph is not alone in this disproportionate increase in administrators. According to the Friedman Foundation for Educational Choice, "Between FY 1992 and FY 2009, the number of K-12 public school students nationwide grew 17 percent, while the number of FTE [Full-Time Equivalent] school employees increased 39 percent. Among school personnel, teachers’ staffing numbers rose 32 percent, while administrators and other non-teaching staff experienced growth of 46 percent, 2.3 times greater than the increase in students over that 18-year period; the growth in the number of teachers was almost twice that of students."

In the state of Missouri, student enrollment increased by 9 percent, while administrators and other non-teaching staff saw an increase of 34 percent over the same time period. The report also noted that Missouri could have saved $491,821,498 over the course of 17 years if the number of administrators and other non-teaching staff had increased at the same rate as students.

Learn more about the St. Joseph schools
The story
2017 Debate over culture Business supporters Ethics complaint filed Understanding the sides Levy and the budget Contentious tax levy 2015 Ripple effect Board resignation Superintendent axed State audit and fallout 2014 Stipend scandal erupts
Former officials
Trustee Chris Danford Trustee Dan Colgan Supt. Fred Czerwonka HR Director Doug Flowers COO Rick Hartigan CFO Beau Musser
Background
St. Joseph School District 2018 school board election 2017 property tax levy 2016 school board election 2015 tax levy renewal 2014 school board election

The issues plaguing the St. Joseph School District go far beyond decreasing enrollment and increasing costs. On June 23, 2014, the 2014-2015 annual budget was released. Former Superintendent Fred Czerwonka—whose fall from grace was triggered by the discovery of the secret stipends—wrote the following in his message that preceded the formal budget:

“	Nevertheless, financial issues loom. While the District has approximately $24 million in operating reserve, that reserve will be depleted significantly over the next several years as school officials attempt to balance the budget. Importantly, the District’s operating levy has not been increased since 2004 and the 63-cent temporary portion of the levy must be renewed by August 2015. Seeking an increase in the operating levy sometime during the next few years appears to be a necessity. Finding the appropriate pathway to the renewal and the needed increase will be challenging.	”
—Dr. Fred Czerwonka

In early May 2015, the St. Joseph board decided against renewing a portion of its operating property tax levy—the very levy Czerwonka said must be renewed—which was scheduled to sunset between April 2015 and August 2015. Local outrage over the stipend scandal, the resulting FBI investigation and alleged nepotism in personnel decisions weighed heavily into this decision, as it cost the district roughly $6.5 million in revenue.

“I can’t stand up in front of the public and say I need 63 cents because I can’t justify it until we do some of the things on this list,” said new board member Eric Bruder, referencing action items recommended to the district in the auditor's report. According to an article by News-Press Now, the decision allows district officials to take the revenue loss into account while drafting the budget, rather than changing the budget midstream if the issue were to fail months later when put to a vote.

Several parents and local business leaders interviewed by Ballotpedia and the St. Joseph News-Press indicated they were either reluctant to support the levy or in opposition to it because of their lack of trust in district leadership. In an interview, former acting superintendent Jake Long insisted that the administration was optimistic about the levy's chances at the ballot box. Long added that even if the levy were unsuccessful, it would not impact the district until the 2015-2016 school year. Had the levy been put to the voters and failed, district teacher Jeff Leake predicted that it would have had a significant classroom impact on the education given to students.

Though the estimated $40 million in unapproved stipends accounts for only a very small fraction of the district's expenditures over the past four years, it's clear the scandal has damaged not just the district's reputation, but also its finances. The fact that the board declined to put the levy before voters is just one example. In February 2013, the board voted to cut $3.07 million from the next year’s school budget. That year, unbeknownst to board members, $3.8 million in unapproved stipends was distributed to select administrators.

The school district also paid $450,000 to its Chief Financial Officer, Beau Musser, settling a slander lawsuit Musser brought against the district after he was wrongfully accused of sexual misconduct and put on paid administrative leave for nearly eight months. This figure, again, is a mere drop in the bucket of the district's revenue and expenditures. Nevertheless, it's a drop that does not go toward furthering the education of the students in St. Joseph.

Disclaimer: The data cited here is from the Missouri Department of Elementary and Secondary Education (DESE). School districts in Missouri self-report their statistics to DESE.

See also

• St. Joseph School District, Missouri
• St. Joseph School District scandal
• List of school districts in Missouri
• St. Joseph School District by the Numbers: Part I