Cell Phone Restrictions Are Coming Soon

If you've ever read the minutes of school board meetings or reviewed our agendas, you may have wondered how policy is developed and subsequently promulgated. As a starting point, the lions share of our board policy work is typically in response to legislative mandates. For example, our April board agenda included more that 25 updates to board policy in response to legislatively mandated changes to the Iowa Civil Rights Code. Typically, it takes two 'readings' before a policy is fully adopted and becomes enforceable. Simply stated, a 'reading' is the board's first opportunity to review the policy, clarify the language or offer amendments. Once the policy has moved through the first reading, the second reading by in large is procedural: the policy is moved to the table for discussion and subsequently adopted. The other policy item on our board agenda that is a standing item is policy review. The review of policy is one of the final orders of business for a meeting prior to adjournment and is generally used to highlight board policies and ensure awareness. Admittedly, this all sounds technical and for certain cumbersome in procedure. However, in practice it is all rather routine. Policy adoption typically doesn't require a lot of discussion since it is usually in response to changes in state law. Since local school boards don't have an option when it comes to following state law, lengthy debate usually isn't necessary.

There are, however exceptions. School boards can, of their own volition, enact policy for the good of the school district. Indeed, we have several such policies in our manual. Our only requirement is to ensure those policies are not in conflict with Iowa law. Which brings us to our current discussion. Going well back to last summer, the board expressed a desire to explore policy that would strengthen our stance on student use of cell phones during the school day. I introduced that idea to all of you on September 25th in an article titled 'Smartphones in Schools'. In that article I discussed the concept, encouraged you all to read 'The Anxious Generation', and invited you to provide us some feedback as we crafted policy proposals. I promised at that time that no imminent policy change was on the horizon, and in fact was several months away.

We followed up on November 5 with an article titled 'What You Told Me About Cell Phones'. I would encourage you to go back and read that article, but the primary takeaway was that 63% of the respondents believed that our cell phone policy needed to be strengthened. It seemed to me that many had read the book, because some of the arguments pointed out the impact on brain development, the importance of human interaction (we'll be talking about AI manipulation soon, mark my words on that), and that if students need to contact their parents, they can use the phone in the office. 63%, by the way is a supermajority.

Around that time, we had policy language drafted and was preparing to bring it forward to a 'first reading vote' when we learned the governor was going to propose legislation on this topic. So, we tabled action and moved it to our unfinished business calendar for the year. The last time you heard from me on this topic was on February 18 with the title 'We Haven't Forgotten'. In that article, among other points I shared with you was that legislation had been introduced on cell phones in schools. From that point forward, we monitored the legislation while continuing our discussions and contemplations.

Then, on April 30, Governor Reynolds signed HF 782 that restricts cell phone use in Iowa classrooms. This bill sets minimum requirements that schools need to take when adopting policies for school districts. The draft language that we have proposed would seem to meet those requirements. In short, our proposal aims to restrict, but not outright ban smartphones in schools. During instructional time, which is defined as from the beginning of the day to the end of the day, student use of personal electronic devices (including smart watches) is restricted.  The only carveout at this point would be a permission for high school students to check messages between classes. It will remain to be seen if this makes the final policy. It is also worth pointing out that, beginning with the 2025-2026 school year, student owned devices will be prohibited from accessing the district wifi. With the scheduled reconfiguration of our network, devices that aren't registered with the network will not be allowed. 

The school board is scheduled to take up Policy 503.9 Student Use of Personal Electronic Devices and Regulation 509.9R1 at the May board meeting. I anticipate it will pass with amendment prior to the final reading in June. It will be effective then, beginning with the 2025-2026 school year. These policies are included here for your review. If you have any questions or comments, please feel free to let me know! We appreciate your patience this school year as we have navigated this topic.

House File 782 signed on April 30

New Childcare Partnership

At the beginning of the 2024-2025 school year, we had planned to host the before and after school childcare program in the elementary small gymnasium. However, at a very early cabinet meeting before the school year was even underway, substantial logistical issues surfaced that forced a shift. When advisors and directors of school programs passionately advocated for space, it became clear the small gym was not going to be a viable option. In the final analysis, I'm not so sure a compromise was reached to resolve the issue. My direct reports would probably just suggest that I simply told people where they were going to live for the school year. The end result was that one of our programs was promised a space that ultimately was taken away so we could move the childcare program to the location where it currently resides. This was never meant to be a permanent solution.

In fact, as I shared back in my February 25th post, we informed the Ys kids program that this would be the last year they would operate at Hudson Elementary. It really came down to a couple of key reasons. First, space was, and is going to be an issue. Second, as our needs have changed in the district the program has evolved. As such, the program no longer aligns with our revised expectations. Finally I'll say this: we have always been a staunch advocate of our community and want to support our community partnerships in any way we can. 

Perhaps it was faulty reasoning, but at that time I didn't really think there would be too much problem with childcare. From my standpoint, St. Timothy 'had the ball'. But it wasn't long afterward we learned that space limitations were going to be a constricting factor for them as well. Feedback and input from many of you encouraged us to re-examine the issue to see if we could find a viable solution. As we announced on Monday of this week, we have found that solution. 

The logistical issues that created barriers at the beginning of the school year still existed. But, with the benefit of time we were able to work our way through those logistics and come up with creative solutions. Hopefully my team will agree the pathway forward will be much smoother! So, now we are ready to start with a new partner for the 2025-2026 school year. St. Timothy will operate a satellite before and after school childcare program right here on campus, utilizing the small gym as their primary location. We are excited about the partnership and grateful for the work that has gone into the planning and preparation for the program. I am also grateful for the internal collaboration and problem-solving that had to happen in order to make this work.

The school site program will operate from 6:30 a.m. until the start of the school day. The after school session will be open until 6:00 p.m. A registration and orientation meeting will be held on Monday, May 5 at 5:30 p.m. at St. Timothy Lutheran Church. You can read the full press release right here. 

Solving for Solvency

Barring movement on the property tax reform bills that are currently being discussed in the state legislature, I anticipate this will be my final blog on school finance for the year. I am somewhat skeptical they will be able to get a law passed this session. There are too many unknowns, and with just two weeks remaining in the legislative session it would seem unreasonable to fully vet these proposals. The stakes for getting it wrong are incredibly high. Understandably we are all eager for property tax relief. But at the same time we must ensure it is done correctly. It would be wise during this interim period to study the issue in greater depth so we can hit the ground running in January of 2026 with a proposal that has been fully vetted.

Today I want to focus on the concept of financial solvency in school districts. But before we get there, a brief primer on 'unspent balance' (USB). As I have hammered home time and again, the most important financial metric in school districts is 'unspent balance'. Unspent balance is the measure of unspent budget authority that either accumulates or deteriorates dependent on the fiscal discipline of the school district. This metric rises to the top of fiscal measures in a school district because it is a violation of state law to have a negative unspent balance. In fact, one can be held legally responsible for cratering an unspent balance. But even more ominous: a school district can be forced to dissolve. The way one increases budget capacity, or spending authority is simply to spend less than the full capacity year over year. In Hudson, we are in very good shape in terms of our unspent balance. In that past decade, this measure has grown from $1.3 million to $5.3 million for the fiscal year ending June 30, 2024. During fiscal year 2024, our expenses accounted for 94.4% of that years budget capacity, hence our improving USB metric. Over the next five years, I anticipate expenditures will be in the range of 96%-98.1% of [budget year] capacity, which suggests our unspent balance will continue to grow. The caveat though, is this capacity is not all funded by cash. 

Which brings us to the second most important financial metric: the solvency ratio. The calculation is rather simple: ending fund balance divided by total revenue for the fiscal year. The target range for this calculation is between 5%-10%. In the fiscal year that ended on June 30, 2024 our ratio was at 16.82%, well above the target range. The challenge however is the trendline is heading in the wrong direction, and it is heading in the wrong direction fast. Why? Well, there are two primary reasons for this.

First is very rapid residential enrollment growth. For the year that we are currently in, our residential enrollment count increased by 50 students. Because of this growth, we had to add staffing to the school district and those students were subsequently counted as part of our enrollment certification process in the fall. As you know, that number forms the basis of our budget a year from now. So, while the cost to employ those additional staff is a real time expenditure, the funding is delayed by a year. This means that cost has to be paid for with cash on hand, causing the cash balance to deteriorate which negatively impacts the district solvency ratio. It is also important to point out, and in fact underscore the impact open enrollment has on this metric. It actually helps. Funding for enrollment growth due to open enrollment isn't delayed, it is on time. If the increase in enrollment was limited to open enrolled students, the impact on the solvency ratio would be blunted because the revenue generated by those students is realized during the current fiscal year. 

The second reason our solvency ratio is headed in the wrong direction is because of special education cost overruns. You see, special education isn't bound by the same 'per pupil' limitations as regular education programming. Students who are served by special education programs are governed by the federal 'Individuals with Disabilities in Education Act', or IDEA. This law requires that each student served receive individual and specialized instruction. Oftentimes these cases can be quite complex, requiring 1:1 support services in the form of paraprofessionals, nurses, specialized transportation; or in the most complex of cases specialized schools. The challenge is that the funding for these programs falls far short of what is needed to fund the students' IEP. Because of this, most school districts in Iowa deficit spend special education programs in Iowa. Hudson is no different, to the tune of more than $650,000 annually. Because the state isn't properly funding special education services, the burden of doing so falls on the local community in the form of property taxes. 

Solvency is really just a fancy word that tells us how much cash is remaining at the end of the fiscal year once all expenses have been encumbered. It's important because Iowa public school districts will continue to operate for approximately 90 days over the summer months without an infusion of capital. Less than 5% may mean the district doesn't have enough cash on hand to fund the operation over the summer months. So we need to ensure our solvency ratio stays above 5%, which means we would need to have no less than $800,000 in the bank once we've solved for all expenditures. That may seem like a lot, but it really isn't for an operation this size. 

Without intervention, our solvency ratio will drop below 5% in fiscal year 2027. However, there is a remedy that includes two parts. First, we need to slow the rate by which our expenditures are growing to just 4%. Now, 4% may still seem like a pretty rapid rate of increase, but keep in mind that at that rate we will still expend just 98% of our capacity. In other words, our budgeted expenditures could grow in excess of 4% and we would still be under the current budget capacity for that fiscal year! (We would just use more cash, which doesn't solve the problem at hand.) Moreover, the rate by which our enrollment has been increasing over the last two years has caused our expenditures grow in excess of 8%. To reduce that growth rate by half is a tall order. However, we are making moves in fiscal year 2026 that should enable us to execute a 'soft landing'. Second, we need to increase our cash flow and fund part of that unspent balance. The way we do that is through a cash reserve levy. I hope you picked up a couple of key words: increase levy.

All of this will need to be done under the context of property tax reform. Now, those who we look to for advice and analysis point out that if the goal of the reform is to simply the property tax system this would accomplish that. It would also provide property tax relief across the state in aggregate. But in reality, it may simply shift the burden from your right front pocket to your left. Instead of this complex bill, if the legislature would simply fund SSA at 3% and meet their obligation for special education funding it would fix our solvency ratio problem: and it would take pressure off of property owners. 

Property Tax Reform

I think everyone can agree that Iowa's property tax system is complicated. Here are a few examples that confound the general public whenever this topic comes up: Taxable valuation isn't the same as assessed valuation. TIF (Tax Increment Financing) districts are economic development tools that incentivize development while suppressing the increased property value of that development until expiration of the TIF district. Depending on what kind of property you own: residential, commercial, industrial, or agriculture; you may be subject to a 'rollback'. Then to confuse everyone a little more, just last week we all received new assessments for our property that didn't match anything that we have been discussing over the last several weeks. That is because those assessments are what will be used for FY2027.

Your property taxes are subject to multiple taxing authorities: school, city, and county; and not all taxing authorities are equal. Taxing authorities that are considered 'property rich' are those with more valuable property such as commercial or industrial. Oftentimes property taxes in those taxing districts are lower because commercial properties have expanded the tax base in way that has brought down property taxes for everyone. On the other hand, a 'property poor' district is not a measure of socio-economics. Quite the contrary. It simply means that taxing authority has a smaller tax base without a lot of valuable commercial property. A smaller tax base simply means it takes greater 'rate' effort to generate the revenue needed to fund the program. Think about our case here in Hudson. Sometimes people will look at their tax bill for Hudson, compare it to surrounding areas and wonder why it's higher in Hudson. Well, there are a lot of reasons for this (hence the complication in our property tax system). Yet in keeping with this idea of 'property poor' we are geographically very small: only 57 square miles. And, our property tax base relies heavily on residential property owners. Compared to many around the state, we have few commercial enterprises to help ease the burden. And those that have come to our community in recent years are in TIF districts so it will be awhile before we are able to benefit from the increased valuation of this property.

Think about this: there are currently 325 school districts in Iowa. If you were to rank them 1-325 with '1' begin the highest property valuation and 325 being the lowest, Hudson would rank 300. But if you include the TIF districts in that same ranking, it would improve our position to 273. I'll concede that's not a lot, but it would absolutely make a difference in the property taxes we all pay. 

If you are confused at this point, you are not alone. That is one of the reasons why the Iowa General Assembly is proposing to simplify the property tax system with an end goal of lowering property taxes. Two identical versions of a property tax reform bill are currently working their way through both the House and Senate. The legislators sponsoring the bills have approached this work collaboratively, asking for feedback and input from the public. At this point, they have taken that feedback seriously and the versions of the bills that are currently being discussed are different from the original proposals. I am grateful they are taking a thoughtful approach to this work. There is a keen understanding that while property tax relief is needed it is paramount they get it right. With that stated, it is unclear (and perhaps unlikely?) this legislation will be enacted during this legislative session. 

Because the proposal continues to be modified based on the feedback our legislators are receiving, I'll avoid getting too deep in the weeds. This is because the legislation continues to evolve. However, I'll start with just one quick observation and theme that everyone will need to keep in mind. If the idea is to provide property tax relief and lower property taxes, we must be clear eyed of what the by-product of this work will be: if the taxing authority is generating less in revenue, it will need to be balanced on the expenditure side of the ledger. I suppose that is a technical way of stating the obvious: budget cuts will be necessary in many taxing authorities. The top news of the day will include even more stories about school districts (big and small), communities, and counties making budget cuts. 

With that context, I'll give you three big ideas to think about with these proposals: the elimination of the rollback, reduction of the uniform levy, and revenue restriction instead of rate restriction. Keep in mind there are other concepts in the property reform proposals that are also incredibly important, but for the sake of this discussion I want to focus on just a few concepts. 

From previous posts, I have explained to you that each year, the property taxes each of us pay are dependent on 3 separate variables: the rate, the rollback, and the value. (See 'Understanding Your Property Tax Statement' from March 19th for a detailed explanation.) In that article, I shared that even if the property tax rate remained exactly the same from one year to the next; the rollback does not. In fiscal year 2025, property owners' taxable valuation was calculated on 46.34% of the value, whereas in fiscal year 2026, taxable valuation is calculated on 47.43% of the value. So, your property taxes will go up even if the rate is the same. Under the proposed legislation, the rollback is eliminated. In short, you will pay property tax on 100% of the value, less the homestead credit. Now logic would suggest this would cause a spike in property taxes, and it would, unless you consider the other two big ideas that are part of this proposal. 

Reducing both the uniform and additional levy in the school funding formula would definitely lower property tax. It's called a uniform levy because its uniform across every school district in the state. Currently, the uniform levy of $5.40 is applied to all property and is the first layer of funding for a school district's annual budget. The second layer is school foundation aid, and it funds up to 88.4% of the capacity, and the remainder, or what is needed to get to 100% is funded through an additional levy. Under this proposal, the uniform levy would be reduced to $2.97 and the additional levy would all but be eliminated with the exception of some special purpose general fund levies like instructional support and dropout prevention. By reducing these levies, it shifts that burden from local property tax to the state. Estimates put that shift north of $400 million. While this would definitely lower property taxes, the unknown variable is affordability. We have already put a lot of stress on the state budget with other priorities, and as such I am skeptical this is sustainable. One unintended side-effect would likely be continued or even compounded underfunding of SSA. Underfunding that fails to keep up with inflationary costs. 

Finally, the property tax reform shifts from a 'rate limited' property tax to a 'revenue limited' concept. Essentially, what this would do is limit the growth of school district special revenue levies to 2% per annum. In so doing, this would appear to suppress the tax base while forcing the levy downward. Think about this. Assume you have a year with a lot of tax base growth. When you apply a rate limited tax to that tax base growth, it will capture the benefit, and revenue of that growth. However, if you limit that growth, regardless of how much the tax base grows to 2%, it will suppress the taxing authorities ability to fund facility improvements and capital projects. It may also impact the bond rating of the authority and make it more difficult to pay off debt quicker. Yet on the other hand, it will force that rate down. 

I agree with the position that our property tax system is in need of reform. I'll even go so far as to say that it is entirely appropriate to justify and explain to the public why property taxes are going up or going down. It is also incumbent on us to be able to share with our stakeholders how those tax dollars are being invested on behalf of the public good and to share a coherent strategy in terms of long term planning. For too long, taxing authorities have looked the taxpayer in the eye and shifted the blame elsewhere; with a shrug of the shoulders would say, 'our tax rate is exactly the same as it was last year, so our taxes didn't go up'. Making this claim illustrates ignorance on the part of the authority at best; malpractice at it's worst. I am grateful the legislature is taking its time on this. We all just need to be prepared that, if we reduce the revenue side of the ledger, we act in concert when it comes to the expense side.

FY 2026 School Budget: General Fund

Last week we began a discussion on the FY 2026 school budget. In that post, I explained that the budget published in the newspaper and on our website is, in reality just a summary. That summary budget is composed of multiple funds, and our conversation last week centered on our capital improvement and project funds. I started there because the projects that are funded through this portion of the budget are the most visible to the community. You can see them, touch them, and when finally complete, they hopefully evoke a sense of pride in our school and community. But the reality is that portion of our budget is a relatively small part of our overall annual operation. To refresh your memory, next year we anticipate roughly $1.68 million in facility expenditures for the fiscal year that begins on July 1. If you closely scrutinize our budget summary, you will note that overall our total budget expenditures are expected to top $16.7 million for fiscal year 2026. (Bonus points for anyone who can tell me why we drop from a high of $25.9 million in fiscal year 2024.)

So then, what you can see, touch, feel: the tactile portion of our fund(s) account for about 10% of our overall proposed budget. Perhaps the tip of the iceberg? The lions share of the budget is of course the general fund. This is the portion of the budget that is used to fund the operation. It ensures the buses run on time, the schedule and bells operate with continuity, and we have the personnel with the right training to deliver instruction to the students of our community. In fiscal year 2026, we anticipate a general fund budget of $12.56 million. Of that, approximately 80% is in personnel costs. As I've mentioned many times, education is a very labor intensive enterprise. According to our most recent employee census, there are 152 individuals on payroll in the Hudson Community School District. Of those, 111 are considered full time.

Preparing the next fiscal year budget begins by first centering ourselves on the current year's budget. This provides for a 'jumping off' point when developing the spending plan for the new fiscal year. If you were to look at the internal budget documents for the new fiscal year, you'll see a number followed by zeros. That number is derived by looking at the current fiscal year, increasing the budget by a set percentage and rounding to the nearest $1,000. Once that budget is adopted, over the summer we begin to refine those numbers and by fall have a pretty accurate idea of how the (new) current year will perform and what we can expect. That really is the key: you can't prepare the budget for the next year unless you have an accurate grasp of how you are currently performing. Each month of experience that we have in any given fiscal year provides us with more data to evaluate the performance of the budget. 

We have numerous tools at our disposal that help us to measure a variety of metrics in our budget. The one shared here is one of the most powerful in our arsenal and helps us understand the performance of the current fiscal year. This is a variance report, and what it tells us is how far over/under the budget each primary category is operating. For example, in the month of February, we collected $1,470 more in property taxes than was budgeted (compare this to January where we collected $2,710 less than was budgeted). Cells that are shaded in green indicate budget categories that are performing better than expected, whereas those shaded in pink represent categories where we are performing worse than expected. The primary takeaway with this report suggests that we are currently underperforming our revenue by just over $62,000 and overperforming our expenditures by $67,771. Both revenue and expenditure are uneven, meaning they don't always arrive at the same time, which is one of the reasons you don't see a uniform color across the report. The other explanation is that the budget category is simply not going to be 100% accurate. If it was, well that might be suspicious; or lucky. And by lucky I mean lottery ticket lucky. In any event, this is the report that was used when we developed the draft FY2026 fiscal year budget. With 66.67% of fiscal year 2025 encumbered, this provides us with enough experience to begin development of the next fiscal year.

Once we have an accurate idea of the current year budget, then work can begin on the 'out' year budget. When developing the budget, the strategy deployed is to underestimate the revenue and overestimate the expenditures. Beginning first with the revenue side of the ledger, much of this is formula driven. In fact, roughly 78% of our revenue is generated by the formula. The formula determines how much property tax AND how much state aid the district will receive. Our inputs are known as miscellaneous income, which is comprised of anything that isn't property tax or state aid. As a reference point, our miscellaneous income inputs come out to just over $2 million. The largest driver of miscellaneous income is open enrollment tuition, at $1.42 million. This number has been suppressed by roughly $200,000. (Under-estimate revenue, over-estimate expenses)

On the expense side, we again start with the current budget. For this exercise, we've increased each category by 8% and rounded to the nearest $1,000. 8%! That seems crazy, right? Well, keep in mind that as our enrollment continues to grow, so too does our need to properly staff our programs. Also understand that the 2% SSA rate that was passed by the legislature nets out to 9.37% for Hudson Schools. See 'This Was Predictable' March 26, 2025. At the same time, the expenditure side of the ledger is developed in a way to capture all of the next fiscal year's spending authority. To put this in perspective, this spending plan would still result in an increase in our unspent balance-with the caveat that it is not all backed by cash. We'll discuss that in a few weeks when we tackle the concept of solvency. In any event, the expense side of the ledger is exaggerated by at least $140,000. (Under-estimate revenue, over-estimate expenses)

The balance of our total budget comes through a couple of funds that we won't spend much time talking about here: the debt service fund, which is used to service our long term debt. Primarily this where the property tax revenue that is generated for the repayment of general obligation bonds is accounted and expended. The final two funds that round out the total school budget include the activity fund and the nutrition fund. Neither of these funds generate property tax, but instead rely on fees for service. Revenue for the activity fund is largely gate receipts from events and the nutrition fund is primarily through the sale of student breakfast and hot lunch. 

Next week we'll spend a little time talking about the proposed changes to Iowa's property tax system and how that may impact our school district. 

FY 2026 School Budget: Facilities

We are about two weeks out from finalizing our school budget for the next school year, and I thought it might be interesting to have a look at the components that make up our budget. To see a summary, go to the 'About Us' page of our website and click on the Basic Financial Data tab. The summary document is included as item '2', and the link directly above is the total FY2026 budget presentation. This school budget summary shows 3 years of high level data: what was actually spent in FY2024, what we think we are going to spend in FY2025 (this is considered an estimate because we are still encumbering this fiscal year), and what we have budgeted in FY2026. 

Each of these 3 columns are subdivided into numerous funds, the largest of which being the general, or operating fund. In the FY2025 school budget, we are utilizing 8 separate funds while the FY2026 school budget utilizes 7 separate funds. The reason we are using one less is because our high school construction project will be completed. Before we go too far, it is important to understand that, in the majority of cases, revenue from one fund cannot be utilized for expenditures in another. Funds used to purchase school buses, for example, cannot be used to pay employee salaries. 

Today I want to zero in on two specific funds that are, for the most part are interchangeable in terms of allowable expenditures. While there are certain caveats, for the purpose of this discussion it isn't necessary to delve into those details. What I want to focus on instead is our facility expenditures, or those specific to our PPEL Fund (Physical Plant and Equipment Levy) which is a property tax levy; and our SAVE Fund, which is our sales tax revenue. 

The top half of the table above is like any other budget you might see; it shows the revenue side of the ledger and runs the calculations for determining how much each funding stream will generate. As I mentioned, the PPEL is generated by property tax based on a set tax rate where the sales tax is generated based on, well sales tax revenue. But, it is distributed based on enrollment. At the far left, you will note the operative fiscal year. This illustrates how much was budgeted, where the second column illustrates how much was expended, followed by the remaining budget. Most important is the ending fund balance, which we anticipate will be around $1.38 million at the conclusion of the fiscal year. 

Directly to the right, you will see what is budgeted for FY2026, which is the fiscal year that will begin on July 1. It is also important to try and look into the future to see what may happen roughly five years out, which would be the columns to the far right (FY2030). Admittedly, one could argue this is an academic exercise, but it does allow us to see what may be in store down the road, assuming our inputs are accurate. For this, we assume conservative revenue estimates and expenditures.

The color coding serves a purpose as well, as it helps to illustrate the type of expenditures that are being allocated to the fund. As the graphic suggests, anything in yellow is an annual appropriation that grows 2% per annum. The categories are pretty self-explanatory: technology covers hardware expenditures; primarily our Apple Computer lease. The transportation line item assumes we will purchase one school bus and one vehicle for the small feet annually, and maintenance is typically reserved for repairs that exceed $500. The line item 'contingency' is generally where emergency repairs are accounted, or in most recent cases classroom furniture.

Items highlighted in pink are related to our long term debt obligations. Not to be confused with the general obligation bonds, this is debt that is specific to revenue bonds. While this does include some of the high school construction, it also includes the bonds that were sold when we renovated the K-8 building. These costs are considered 'fixed' because they are not prone to an annual increase. 

Finally, this leads us to those items highlighted in green. Those are projects that have been posed in previous fiscal years that fall outside the aforementioned categories. Once they are ready for execution, I recommend them for approval and the board can decide whether or not to move them forward. A primarily litmus test for affordability is the impact the project will have on the ending fund balance. My goal is to keep the ending fund balance above $1,000,000. If we can do so, I feel comfortable recommending approval to the school board. So, what are those projects?

Elementary Lockers: At the end of January, in my post, 'Growing Pains', I shared with you the challenges, both seen and unseen the went along with growing enrollment. This is one such area that needs to be addressed. According to our calculations, we are going to be short approximately 25 lockers a year for the next couple of years until we reach full capacity. This project calls for the installation of 100 lockers on the north side of the hallway that contains the elevator. This project was approved for completion over the summer. 

Network Replacement: This is all the equipment that makes the internet and intranet work. Without it, we have no ability to communicate with the outside world (or even the inside world). It enables our bells system to function, the clocks to sync up correctly, the intercom system and emergency alert/tornado or fire alarm to work. Because of the rapid pace that technology evolves and internet speeds increase, this equipment is generally obsolete after about five years. This will be our 3rd generation network and it has been approved for replacement this summer as well. The good news is, as a governmental entity, we are eligible for eRate benefits that equate to a 50% discount on eligible expenses. This proposed project will replace all network switches and wireless access points. The project is valued at $128,308 and the district cost is $64,154!

Second Floor Carpet: The staff that live on the second floor have lobbied me for carpet upstairs for several years. My response has always been, maybe next year. It's not so much a comfort issue (although that is certainly part of it) as it is a noise issue. Whenever students move chairs across the floor, you can hear it in the library and 5th grade classrooms that are directly underneath them. This project will make the rooms downstairs quieter and the upstairs rooms more comfortable. The current ‘Little Pirates’ room will also have carpet installed as part of this project as it will become a special education classroom next year. This project will start as soon as school is out for the summer.

Auditorium Sound System: This is more of a 'coda' (see what I did there, music folks?) to the high school project. Last summer, as part of the high school renovation we replaced the lighting system in the auditorium. What was not addressed was the sound system, which is woefully inadequate for modern high school music and theatrical productions. It became even more evident once we experienced the equipment specified for the new gymnasium (sans microphones)! This proposed project will rectify that at a district cost of $45,771. 

Kindergarten Restroom Renovation: I've saved the biggest for last! This project is actually scheduled to span two separate fiscal years since it is scheduled to begin right away when school dismisses for the summer and won't be completed until the second week of August. You will see that noted in the green shading under the FY2025 budget. Like the locker project mentioned above, this is related to growing enrollment. The restrooms in the kindergarten wing simply aren't adequate for the class sizes we are now experiencing. This project will relocate the maintenance shop and turn that space into a restroom, and convert the two restrooms across that hall to one large restroom. Once completed, we will double the capacity of the kindergarten restrooms. The project also calls for the replacement of all the floor tile in the kindergarten hallway and the replacement of classroom doors. You may remember, the kindergarten wing was remodeled as part of Phase I of the elementary renovation project. Subsequent phases included door replacement with the idea we would circle back to the kindergarten at some point. That time has arrived!

We'll continue this conversation next week with a peak at the largest fund in the school budget, the general fund. Following that, we'll examine the proposed property tax reform legislation that is currently being discussed in the legislature. 

This Was Predictable

It should come as no surprise that school districts all around the state are facing budget cuts. Des Moines cut $14 million from its budget during this school year and continues to have discussions about future budget limitations. Dubuque recently announced the closure of one of it's elementary schools and is poised to make even more budget cuts. Cedar Rapids is planning a $12 million reduction; and in our own backyard, Waterloo has announced a $10 million cut. 

As some of the largest school districts in the state located in metropolitan media markets, it is not surprising these are top of fold stories. For the most part, these budget cuts are due to enrollment decreases caused by private school vouchers. Now, I'll concede the point that school districts must staff their programs to match enrollment patterns. But as I have argued multiple times, it is never an equivalent tradeoff. In other words, a 20 student drop in student enrollment may well suggest the elimination of a teaching position, but that 20 student drop didn't occur in just one grade level. The by-product will be larger class sizes, the dilution of support staff to work with those students, and the elimination of programs. 

While the largest school districts in the state grapple with the implementation of what can only be described as austere budget cuts, smaller rural school districts have had to contend with decreasing enrollment for years. In our own conference, 10 out of the 14 districts represented had a decrease in enrollment averaging 17.04 students from last year to this year, and it isn't a 1 year anomaly. This is a pattern. If it were a 'one off' perhaps a more nuanced strategy of budget reduction could be implemented. But when you are shedding 20+ students a year it becomes a much more serious issue. It simply becomes unsustainable. That is what happened in the Orient-Macksburg Community School District. Located in southwest Iowa, the residents there voted to dissolve at the end of the current school year. 

Implementing a strategy that reduces expenditures in light of a decrease in enrollment is as obvious as the sun coming up tomorrow (as painful as it may be). Public school funding in Iowa is tied directly to enrollment, so the fewer students that are enrolled means less revenue. The remedy is to cut the budget. Granted, saying it and doing it are two completely different things. These decisions and discussions become quite emotional, particularly when a favorite teacher loses their job or a popular program is eliminated. 

But decreasing enrollment isn't the only reason why school districts are cutting budgets right now. Truth be told, the fact that annual growth in per pupil cost (aka SSA) isn't keeping up with inflation is another reason. And with the rate being set artificially low year after year, it only exacerbates the issue. When you compound decreasing enrollment on top of low supplemental state aid, well the outcome is quite predictable, and exponentially more challenging. 

Think about this. Currently, the general assembly is locked in a stalemate between the House and Senate about how much to increase the state cost per pupil for the next school year. Set aside the fact that the legislatively mandated deadline for doing so has long since passed, and that there is no mechanism or penalty for this abdication of responsibility. The Senate insists the rate should increase by 2%. The House insists 2.25%. Either way you slice it, this is below the the current CPI rate, or 'cost of living adjustment'. Both legislative chambers argue this is what the state can afford. Considering they blew an enormous hole in the budget when all the private school students were added to the state cost per pupil calculations-its no wonder. Furthermore, the states latest revenue estimations suggest a $1.2 billion decrease in revenue between FY 24 and FY 26. Yes, this was not only predictable: it was forewarned.

Frankly, I think 2% is the best we can hope for.

Consider a scenario where enrollment is exactly the same from one year to the next. That amount of budget growth (2%) doesn't even keep up with inflation, which means the only remedy is to cut expenditures. In Hudson's case, [if we had] flat enrollment this would equate to an increase of $127,723. To put that in perspective, our general fund expenditures next year are expected to top $12.5 million. That won't cover the fixed costs needed to manage the budget, let alone grow programs. Luckily, Hudson has growing enrollment so we are in a much better position than most. 

The point is this: a school district's enrollment grows or they will have to cut their budget. 

Understanding Your Property Tax Statement

If you haven't already, in the next couple of days you'll receive a notice of proposed property tax in the mail from Black Hawk County. The purpose of this notice is to provide transparency to property owners as it relates to your property tax bill. Prior to enactment of this law, the requirement was simply to publish the rate per thousand with the notice of proposed budget. The trouble with that practice was, without providing any context the rate [alone] is virtually meaningless. This notice is meant to provide that context. But it doesn't quite close the loop because it a bit confusing and a little misleading. 

First, it's important to understand the question we are trying to answer. I think its pretty simple. As a property tax payer, I want to know if my taxes are going up or down; and why. The problem with the way we used to do it is that when it came time to pay property taxes, our only reference point was the rate. If the rate went down or stayed the same, our working presumption was that our taxes would either be the same as the previous year or go down. Except they usually don't. When the tax bill came we were surprised (and not very happy) to learn that it was in fact higher than it was the previous year. So you might call the taxing authority and ask why (in this case, perhaps a Superintendent of Schools, County Board of Supervisors, or City Manager). The answer that you probably would get was less than satisfying: "Our rate is the same as it was one year ago". That answer is disingenuous at best. At worst, it's misleading because it fails to properly provide the context as to how property tax is calculated. 

The formula for calculating property tax is really quite simple: Taxes Levied = Value x Rate (T=VxR). Rate is the only variable that is controlled by the taxing authority. Value on the other hand is not, and quite frankly is a bit more complicated to understand. That is because value is determined by the county assessor and subject to the 'rollback'. So for starters, if your property assessment is $100,000 in year one, is it assessed at $100,000 in year two? If the answer is no, and with all other variables remaining equal your property taxes will rise. The other consideration is the rollback. Simply stated, a rollback does just that. It rolls back the percentage of your property assessment that you actually are responsible to pay taxes on, which is known as the taxable value. Last year, your assessed value was rolled back to 46.34%. So on that $100,000 house, your property tax bill was calculated on $46,343. This year, your assessed value is rolled back to 47.43% in taxable value. On that $100,000 property, your property tax bill is now calculated on $47,432. This means that even if the rate is identical from one year to the next, your property tax bill will increase. It will compound even more if the assessed value of your property increases. Kind of like a 'double whammy'. In this example, you can see how the rollback alone impacts your property tax bill- independent of rate and property value: 

What the legislature is trying to do with the property tax payer statement is to help you understand what is going on in this formula, and see what your property tax bill is going to look like compared to the previous year. Valiant effort for sure. But no doubt confusing and somewhat misleading. Let's take a look. To begin, if you haven't seen the notice yet you can download a copy of it from our school website. You can go to the 'About Us' page and find it as item #3 under the 'Basic Financial Data' submenu. Or, click right here. For the purpose of this conversation, I want to focus your attention on the bottom third of the notice, which is captured here for your convenience. 

First, let's take a look at the top line of the graphic depicted above. The arrow to the left represents the property tax rate for the current school year. If you follow that column down vertically, you will see the property taxes that were levied for the current fiscal year assuming your property value was $100,000. On the right (see the top right arrow) is the proposed property tax rate for the next fiscal year. This is where the property tax statement gets confusing at best and misleading at worst. In the far right column, those two arrows seem to suggest that the property owner can expect to see a 12.81% and 14.22% property tax increase based on their property valuation and whether or not it is residential or commercial property. However, this instrument makes the huge leap that your property valuations have increased by 10% from one fiscal year to another. See the section circled to the left. Unless you have made some pretty substantial renovations to your property, that kind of increase seems unlikely.

So, what of the 'effective property tax rate'? Well, it's a meaningless measure that is set by Code, which is why I crossed it out in this example. This number is arrived at by taking the 2025 property taxes and dividing them by the 2026 valuations. Think about it this way. If you are a basketball player and took the number of field goals you made last year and divided it by the number of shots you made this year. While you can certainly calculate it, it's not an incredibly useful metric.

Now that you have a better idea of how your taxes are calculated, the operative question must be, why the change? Good question! If you refer to the graphic above, you'll notice a stated reason. The trouble is that the graphic above is limited to a 300 character maximum, so we can't provide a lot of detail. What is 'cash reserve levy' and why is it important? Well, specifically this refers to a financial metric known as the 'solvency ratio' and measures the percentage of reserve fund balance against the total revenue for a fiscal year. In recent years, our fund balance, and solvency ratio has been dropping. This is because of two primary reasons: enrollment growth and special education expenditures not funded by the state. It is important to be specific though when we talk about enrollment growth. The enrollment growth that is being referenced here is residential enrollment and NOT open enrollment. Students who attend Hudson under open enrollment are funded through 'on time' funding whereas residential enrollment gains are funded a year behind, thus the reason for the drop in fund balance. The mechanism with which to recover this fund balance is through the cash reserve levy. The target range for our solvency ratio then, is 5%. 

The other levy rate that may tend to fluctuate from one year to another is the management fund levy. You should notice that the amount of levy has decreased from $546,065 to $347,560 for next year. This is done primarily to offset the increase needed in the cash reserve levy, and to deliberately lower the carry forward balance in the management fund. Don't worry, there is an overarching strategy here as well. The management fund, you may recall from previous posts, is used primarily to fund retiree benefits and property/casualty insurance for the district. In recent years, deductibles for catastrophic property loss have increased substantially: to 1%. This may not seem like a lot, but with close to $50 million in assets, 1% is $500,000. The strategy here is to maintain a balance of $500,000 in the management fund after meeting our other fiscal obligations and encumbrances so as to cover the deductible in the event of a catastrophic loss. 

While not incredibly intuitive, the purpose behind these taxpayer statements is noble. It is also meant to provide accountability from the taxing authority. For too many years, the focus was rate driven where instead it should have been revenue focused. Most people probably aren't all that interested in what the rate is. You are not writing a check for the rate. However, you are interested in how much you are writing the check for; and deserve to know the reason why it is different from what it was the previous year. 

Hiring for Our Future

This is shaping up to be one of the busiest hiring seasons for licensed staff we have had in more than a decade. As of the writing of this article, we've hired six licensed staff positions and have three openings remaining. Granted, of these nine, three represent new staff due to increasing enrollment. Even so, six of them (representing approximately 8% of our teaching staff) are positions that are being vacated for a variety of reasons. Whenever we have turnover it is imperative that we look inward and ask hard questions. Attracting teachers is one thing. Retaining them for the long run is entirely different. Naively, when we hire teachers I believe they are going to stay in Hudson for their entire career! Yet when I look back at our employment census over the last decade, I run across those who were here for a year or two before departing for other opportunities. In some of those earlier hires it is becoming somewhat difficult to put a name with a face!

We have worked very hard over the last handful of years to create climate and culture where our educators feel valued and respected. A place where they can earn a salary that recognizes their unique talents, educational level, and skill set. Hopefully they see in Hudson not only a great place to work, but a safe place to raise a family. But it is a bit discouraging when I see the number of vacancies that have piled up so far this spring. I suppose the bright spot is that, for the most part these vacancies have more to do with personal decisions than they do with an overall dissatisfaction with our district as an employer. It is my firm belief this hiring season is merely a confluence of coincidences.

While we may be able to take a bit of comfort in that regard, it doesn't erase the monumental task that has been placed on our hiring agents to fill these incredibly important vacancies. That is in part one of the reasons why we try to get a jump-start on hiring. The great candidates won't be around for very long! Furthermore, our hiring practices include making both tactical and strategic decisions. We are lucky insofar as our stronger financial position enables us to hedge a bit when making tactical hiring decisions. Keep in mind our financial position is directly linked to outperforming our enrollment projections. Because of this growth, hiring decisions are critically linked to maintaining educational quality and student-teacher ratios. It becomes much more difficult when enrollment is static or declining. With static or declining enrollment, tactical decisions are oftentimes not possible because the SSA growth factor isn't even enough to meet current employment contract obligations. The byproduct of which is delayed hiring decisions and larger class sizes. 

Increased student numbers necessitate additional staff, from teachers and support personnel to administrative roles. Case in point: we have 200 more students in our district today than we did in 2010, which was the last time we employed a middle level principal. At the same time, our incoming kindergarten class currently projects 68 students. One that could be staffed with 3 teachers, but tactically it makes sense to staff it with 4 teachers because we simply don't know how many 'move ins' we'll have over the next 6 months and financially we can afford it. You can be assured though, that if that particular grade level maintains an enrollment in the mid to upper 60s it will be converted to a 3 section grade level at some point in their continuum of education. 

Our hiring practice isn't simply about filling immediate vacancies; it requires strategic forecasting to anticipate future enrollment trends. This is one of the reasons why we have contracted with an outside firm to help us understand our enrollment patterns and develop sound projections. By analyzing historical patterns juxtaposed with statistically accurate projections, it provides for a proactive approach that ensures we can accommodate a growing student population without putting undo financial stress on the system or compromising the learning environment. For the last handful of years, we have budgeted for another English teacher at the high school without filling that position. The need has just 'not quite' been there yet. This year, because of some internal requests for transfer based on credentials we had available, we were able to move forward with adding this position. However, the reality was/is that we could probably get by staffing it as a half-time position. But to be honest, in this labor market there is very little interest in part-time employment. So we needed to think strategically. In order to be able to recruit (and hopefully retain) quality staff, we've added a course to the English department and created an additional section of another. While not yet a full time position, this strategy will ensure that our school not only meets its present day obligations but also builds a strong foundation for future success. 

Implementing AEA Reform

During the last legislative session, the general assembly was mired in debate over the future of the AEA system in Iowa. Legislation was proposed that would forever alter the mission and scope of the system. Almost everyone in the education sector argued against this legislation, claiming the change stood to do real harm. Parents advocated as well, sharing personal stories about how the AEA had positively impacted their families. All of this was to no avail. The decision was made, it was now just a matter of getting it through both chambers and to the governor's desk. Once the inevitability of the plan was set in motion there was no stopping it. Calls to at least slow down and thoroughly study the issue were dismissed. Legislators who stood opposed quickly fell in line, and the speed at which a proposal became the law of the land was quite dizzying. 

It may surprise you to know that in my role as Superintendent of Schools, I don't have to make a lot of decisions. Most of the day to day decision making in a school is done by the teachers and administrators. It may also surprise you to know that those daily decisions range in the hundreds. Mine do not. But the decisions that typically are made in my office have far reaching consequences. When it comes to the budget, a financial mistake can be catastrophic. When it comes to tax policy, it can be economic. And when it comes to capital improvements, those decisions can be generational. Because there are fewer decisions and they have impact far beyond my tenure, none of them need to be made with haste or immediacy. I have the benefit of time to study, gather feedback, float ideas, and most importantly: think things through. It is important to consider the long range implications of that decision. For example, when principals advocate for adding FTE I remind them this isn't a $50,000 decision. It is a $500,000 or a $1,000,000 decision. By taking the time to gather the data, study the issue, and listen to constituents, it gives me the opportunity to see my blind spots and shape the decision. Taking ones time when making big decisions leads to better outcomes. What happens when we rush things? Well, I would point to the current status of the AEA system as 'Exhibit A'. 

Since that bill was enacted, as a state we've largely moved on to the next thing. What's done is done, there is a new issue that needs to be addressed-advocated for; advocated against. Except for one thing. The education sector hasn't really moved on. The work of implementing this massive piece of legislation is ongoing. So how is it going? Well, it's going exactly like we thought it would: not great. 

Part of the beauty of the AEA system was the fact that school districts knew that working and partnering with the Agency was among the most cost effective ways of doing business and providing services to students. In other words, it was always cheaper to work with the AEA. From massive printing projects to repairing computer equipment; one couldn't beat the AEA. However, the legislation was explicit in the fact that fees for service needed to be 'market value'. Translation: more expensive. Now in fact, it makes sense to use Copyworks instead of the AEA for some projects. We could share positions with the AEA. Perhaps a school district needs an ELL teacher, but not a full-time ELL teacher. The collaborative network of the AEA could make that happen. Simply take the cost of that employee and divide it among the districts utilizing that service, and that was all there was to it. But now, if the AEA is involved, be sure to add in the operational fee. 

Right now, as we speak school districts all across Iowa are developing service delivery plans with their local AEA. We are trying to decide what services to contract, what professional development consultants should be employed, and whether or not to use Copyworks. Indeed it is very difficult to make some of these decisions; who knows whether or not we'll need a consultant for a 'problem of practice' that presents itself on March 4, 2026. Time of course is of the essence because the AEA has to submit their budgets by February 28th to the Department of Education. Without knowing for certainty what their staffing plan will be or supplemental state aid.

So what are districts doing? Well, they are opting out. It makes little fiscal sense to share a position with the Agency when they can avoid an operational fee by sharing directly with another school district. It makes little sense to commit the expense of a professional development consultant without knowing for certain it will need to be deployed. And if it is cheaper to get printing done a Copyworks, guess what?

It is both maddening and frustrating. But at the same time I have incredibly empathy for our colleagues all across the state who have worked in and for the AEA system. Most of us didn't ask for this, but here we are. I predict a year from now the statewide AEA system will be a shell of what it once was. And I predict the work that we once relied on the AEA to perform for us will now be done by the local LEA. It will be more work for those districts, and more expensive.

The Childcare Conundrum

At the end of January, I posted an article titled 'Growing Pains'. The theme of that post was to discuss the significant enrollment gains the district is experiencing and the stresses that growth is causing throughout the system. Part of that article explained that it was relatively easy to add an extra section of a grade level when the numbers dictated such. But, perhaps 'easy' isn't the right word. Maybe it is just easy to see? After all, the sheer numbers make these relatively simple math problems that can be observed by anyone. I ended that column with an explanation that led to our decision to proceed with the hiring of a middle level building principal. Ironically enough, we are interviewing candidates for that position this week. But if you recall, I also shared that the 'easy' decisions ended there, and there were in fact a lot of unanticipated issues lurking in the shadows. 

The fact that, once the current 2nd grade gets to 7th grade we are going to have some limitations that quite frankly could lead to larger class sizes. We'll need to answer some questions like: The number of restrooms we have? Computers for students? Where to serve lunch? How long would we like lunch to last? Where and how many classrooms do we have? All of these are issues that will continue to compound. Luckily we have a few years to figure it all out. Yet truth be told, we are reaching that tipping point where these constraints are now presenting in unique ways. Is another facility project in the future? Possibly. But before that conversation, we'll need to do a lot of legwork prior to embarking down that road. Nevertheless, space is now at a premium in our facilities and will be for the foreseeable future. 

School programs and all the trappings that come along with them take primacy in school facilities. I think everyone agrees with that. This would include everything up to and including those activities that take place before and after school, right? Our co-curricular clubs need a place to meet, athletic teams need a place to practice, and the after school program needs a space for after school study. That is why we informed the 'Y's Kids' program this past fall this would be the last year they would be able to operate in the school. Due to increasing enrollment, we simply don't have space available for the program next year. While we had considered some of our 'common space' as alternative locations, the number of activities and spaces they use make these solutions untenable. Yet we saw this coming. Last year should have been their last year, but we were able to make it work by sharing space with other groups. Further, it was just too close to the start of the school year for families to make alternative arrangements. 

Remember in the first paragraph where I made the comment that there are a lot of unanticipated issues lurking in the shadows? Well, this would be another. But, we're not the only entity to experience space constraints. Case in point: the largest provider of before and after school childcare in our community is also at capacity. St. Timothy Preschool & Childcare recently announced limitations to the number of children they will be able to serve in the 2025-2026 school year. As a community, we are incredibly grateful for the service St. Timothy provides. At the same time, I totally understand and empathize with the enrollment constraints they are currently contending with. 

St. Timothy is a great partner for the school district and we are happy to have them, not only as a resource for our school district but the community writ large. They have done real yeoman's work in the childcare arena. They have continually looked for opportunities to expand and grow their programs. We have engaged with them where we can. However, it is not St. Timothy's responsibility alone to solve the childcare conundrum. Nor is it the school districts. We are clear eyed that while this is a school related issue, it is not solely a school problem to solve. Even so, we are committed to helping find solutions where we can. But let's be clear, even working closely together, this will take a collective effort to solve. If you would like to be part of the group that has been working for the past 18 months to try to solve the childcare challenge (shortage), please contact Clara Nehmer, Director of St. Timothy Preschool & Childcare. 

We Haven't Forgotten

Early in the school year we had a discussion about the ubiquitous presence of smartphones in our district, particularly in the high school. To refresh your memory, I would encourage you to checkout the September 25th installment of my blog titled Smartphones in Schools. The cliff note version is that we were seeking community feedback on whether or not our policies needed to be strengthened and an invitation to join us in our quest to learn more by reading Jonathan Haidt's book, The Anxious Generation. That post was followed up by a survey and a November 5th article titled What You Told Me About Cell Phones. In that column, I shared results that indicated 63% of respondents believed that our cell phone policy needs to be strengthened. During this interim period, there has been very little in the way of discussion about this topic, at least in this blog. Yet that's not to say we haven't been engaged in policy discussions and proposals. In fact, those policies currently do exist in draft form and were scheduled for a first reading at the November 20 school board meeting. However, after reviewing those policies and debating them on their merits, I recommended the board table action on the policy. The consensus being that we needed just a little more time to iron out some inconsistencies and logistics. Throughout this dialogue I have asked that we take our time so as to get our policy position right. 

Then in December we learned the governor was going to propose a legislative policy on cell phone usage in schools. So, I recommended the board table action until we learned more about what the governor would propose. Even so this work has continued slowly in the background, along with a standing discussion on the school board agenda as one of our items of 'unfinished business' for the school year. In any event, the governor's proposal was introduced last week in the Senate as SSB 1065. The bill includes much of what one might expect in a cell phone 'ban' bill, primarily among them a restriction on student use of personal electronic devices during classroom instructional time. This proposal sets the floor for restrictions and further authorizes the Board of Directors to adopt policies that are more stringent. However, what is most interesting, and perhaps helpful, is a proposed legislative mandate that includes instruction related to the effects of social media for grades 6-8. So our work continues. We will monitor this bill through the process and offer suggestions and insights as it moves through the process. In my view, this is a great starting point. 

Meanwhile our book study continues. In part 4 of The Anxious Generation, Haidt argues that collective action is needed in order to tackle and counteract the negative effects of overuse of electronic devices in classroom. What action is needed formed the crux of the question I asked my administrative cabinet at our last meeting. What exactly is the problem that we are trying to solve, I asked them? If it is merely to combat the distractions caused by devices during instructional time (in class), then our current policies are likely sufficient. However, if instead our goal is to improve the mental health outcomes of our students then we likely need to go much further. I then pondered somewhat rhetorically, in twenty years are we going to have causal data that links extreme mental illness in children to the effects of electronic devices? Could we be looking at the next 'Big Tobacco' moment in American history? 

Perhaps. Haidt argues collective action is needed in order to address this issue. Schools are certainly part of the solution. But so too are the tech companies. When called to the carpet for the damaging impact of their products, tech companies will look their accuser in the eye, and with a wink and a nod tell you their products aren't intended for users under the age of 13. In fact, it is federal law. These companies are relying on the honor system to enforce these laws. How hard is it to create a fake profile? It's not. However, the technology for age verification exists; but these measures would impact the bottom line, it's all about the 'hook'. If you read nothing else in Haidt's book, read pages 230-231 where he claims that internal documents obtained from Meta show they have considered how to reach children as young as 4! (The Anxious Generation, Chapter 9 page 231).

Collective action. If we use the metaphor of a stool, I think it perfectly encapsulates the idea of collective action. We need schools to have strong policies regarding the usage of personal electronic devices in schools along with an educational component that teaches not only appropriate use but the negative mental health impacts of overuse. We need tech companies to implement strong age verification protocols to protect young people from harmful content. And finally, we need parental support. Indeed, a supermajority: 63% of respondents indicated that we need to strengthen our policies. That is impressive. But at the same time, 37% disagree with that statement. And a subset of that 37% have very strong feelings. While I may not agree with some of the reasoning surrounding these objections, I can empathize with those feelings. It is then, incumbent on all of use to underscore the rationale behind a policy change while at the same time incorporating into those policies measures that mitigate those fears. 

Our work continues and we haven't forgotten!

Where We're Headed: Part 2

At the beginning of the school year, we conducted a needs assessment survey to help us with the formulation of our next strategic plan. As part of that planning, I spent some time reviewing the progress we made on our most recent plan, which you can find in this article here. Respondents for the survey included 1 school administrator, 2 school board members, 11 staff members, 130 parents and community members, 29 teachers, and 50 students. Thank you to everyone who responded. The board subsequently used those responses to formulate our next strategic plan which can be accessed under the About Us page of our school website. 

Setting the stage for this strategic plan, we recognize foremost the district is experiencing robust enrollment growth, due to both open enrollment and residential enrollment. This, along with a strategy for controlling open enrollment was discussed at length in my October 16 article entitled, 'Counterbalancing Residential and Open Enrollment'. There is no mistaking the fact that residential construction in Hudson has been on the upward trend. In 2023, 22 residential home building permits were issued, adding a total residential value of $10.8 million to the district. Through the month of August (2024) 22 more residential home construction permits were issued, adding an additional $11.9 million in taxable value to the district. Over the last two years, 44 home construction permits have been issued in the Hudson Community School District. For more information on the growth of our school district, please refer to my January 29 article, 'Growing Pains'. 

This sets the context for this strategic plan. While the current plan suggested enrollment growth, it was much more conservative and speculative than what has actually come to fruition. This [enrollment phenomenon] is even further removed for the document titled ‘Hudson 2020’ where enrollment was actually declining across the district. Indeed, this is a very different school district than it was a decade ago, even five years ago when the previous plan was adopted. As we soon will see, the challenges facing the Hudson Community School District are vastly different from those faced in 2019.

Among the key findings in the survey, a plurality of both parents (45%) and students (33%) suggest that preparation for life after high school be the top priority for improvement. There is a significant drop-off after that, falling to 19% of parents suggesting that meeting the needs of all students should be the top priority. A second priority becomes less clear for students, as there does not seem to be a statistically significant finding. It is also less dramatic when board and staff members are asked to identify their top priority for improvement, although ‘reading’ is clearly identified (21%). However, the drop-off to ‘meeting individual needs of all learners’ is second at 15%. 

The district is currently wrapping up a major construction project at the high school attendance center. Included in this project is the addition of a career and technical education center. This career center, coupled with the addition of the CAPS program and more robust work-based learning opportunities, may help strengthen the top area of improvement as identified by both parents and students: prepare students for life after high school.

While only 26% of students indicate that anti-bullying efforts need to be improved, it did represent a plurality of students. On the other hand, 23% of board and staff members suggest teaching needs to changed, compared to 28% of parents and community members indicating that parental involvement needs to change. Both the elementary and secondary schools are engaged in continued efforts to combat bullying and harassment in schools, which was indicated as an area that needed to change by the students. The high school is currently involved in a social and emotional based professional development series designed to improve overall mental health in the system. Further, the district has recently taken steps as required by Iowa Law to combat chronic absenteeism and truancy. This work better enables the district to fine tune and understand what reasons may be leading to chronic absenteeism, including avoidance that sometimes comes from bullying. Finally, the board is currently engaged in work to strengthen our cell phone policy, which may be a contributing factor in online bullying and harassment.

In the future, the district may wish to consider major emphasis on instruction, content and the rigor of content standards keyed toward active student engagement in the classroom. In doing so, this will ensure that all students can learn at high levels, overcoming barriers and improving student achievement. Additionally, continued effort should be made to align the assessment system to the rigor of the standards. Finally, it will be important for all stakeholders to understand how leadership teams are organized and understand how they have a voice in decision making.

Our next step then, is to take those recommendations as outlined in our strategic plan and convert them to actionable goals. The School Improvement Advisory Committee (SIAC) will meet this spring to help formulate those goals. To read the full strategic plan, click this link. 

The Trouble With the State Budget

My first year teaching after graduating from college was in a small parochial school with a starting salary of $18,100. I can remember getting that first paycheck and thinking: wow, I can't believe they are actually paying me to do this job! 

After I got past the euphoria of being a professional, it didn't take all that long to realize that wasn't a whole lot of money, even in 1995 dollars. For perspective, the average starting salary for a public school teacher in Iowa at the time was $21,338. By the time I paid my rent ($250), a used car payment, and utilities, there wasn't much left. Then when the student loan payment kicked in a few months down the road there wasn't anything left. When faced with issues like this, there are a couple of solutions: find a job with more income or cut expenditures. For me, this meant no cable TV (cellphones weren't even a thing back then so no cutting to be had there), and a lot of canned food! I was young and healthy, so health insurance was also a luxury that I couldn't afford. For those of you too young to remember, in the mid 90s health insurance wasn't always a 'sure thing' as far as benefits were concerned. I could purchase it from my employer, but it was far too expensive and seemed like a waste of money considering I never went to the doctor. (I know, I know!)

Whether it's 1995 or 2025, that is how budgeting works. You live within your means. If your 'means' are too high, you cut expenses. Or you look for a way to improve your income stream. That's how it works for governmental entities as well. Except, not always. For public school districts, we really can't change the revenue side of the ledger. Our revenue is governed by property taxes and state aid. We have a statutory limitation on [spending] based on that revenue stream that is known as 'spending authority'. If revenue doesn't match expenditures we only have one option: cut expenditures. 

What if I told you that when faced with a budget problem instead of cutting expenditures, we were actually going increase our expenditures? You would probably tell me to update my resume. But wait, I'm not quite done yet. What if I also shared that instead of looking for ways to improve our revenue stream, I would actively pursue strategies to decrease that revenue? Up is down, down is up. Most people would probably question my competence. Rightfully so, rightfully so.  

Yet that is exactly what is happening with the state budget. In fiscal year 2023, the state of Iowa general fund net receipts were $9.721.3 billion. The Revenue Estimating Conference met on December 12, 2024 and set the 2026 fiscal year estimate at $8.601.9 billion. Yes, these numbers are quite large, but the math is quite simple: a $1.120 billion decrease in revenue. The decrease in revenue is because of policy decisions that have been made at the state level regarding tax reform. We'll all pay less in taxes this year. We're all for lower taxes! However....

In order for this to work though, there has to be offsets on the other side of the ledger. The expense side of the ledger, and we need to be prepared to accept the consequences of those offsets. It may come in the form of road repairs. Public safety. Or in the case of public schools, larger class sizes. The challenge of course, is that we want to have our cake and eat it too. The truth is that we like to have smooth roads and safe bridges. If we need to call 911, we sure hope someone shows up quickly. And parents, well I know you don't want your kindergartener in a class of 30. 

The reality is that very few things in our economy cost less than they did a year ago. In fact, its a safe bet they are going to cost more: fuel prices and natural gas are up. The software that runs our student information system cost $10,360.50 last year. This year, that same software package was $12,262.62. That kindergarten teacher is going to work wherever they can earn top dollar for their talents. So it goes. The only way to really impact the expenditure side of the ledger then, is to implement some of those 'austere' measures that were discussed in the paragraph above. We've actually had to do that before here in Hudson. I can promise you it is no fun and incredibly painful. I'm glad we don't have to do it right now. Even so, I understand the challenge.

Except that isn't what the state has done. No, quite the opposite in fact. Instead of cutting expenditures to match the revenue stream-they have actually increased the expenditure side of the ledger. And not, by the way through a natural 'maintenance of effort' type strategy. You know where I'm going, right? The expenditure side has increased because of the added expense of the voucher program. HF 68, enacted in the 2023 legislative session phased in state funded Educational Savings Accounts equal to the state cost per pupil set annually by the general assembly. It included a three year ramp up that this year includes no limit for income eligibility. The additional cost to the state, that didn't exist prior to 2023 is estimated to be more than $450 million annually.

So when compared to fiscal year 2023, we already estimate a revenue gap of over $1 billion entering fiscal year 2026. Add in the expense of the voucher program and the state has effectively decreased revenue while at the same time committing to new expenses. This only makes the gap worse. Now, there will be calls to use the emergency or rainy day funds to close this gap. Frankly, I'm not sure that is a wise decision. 

In school districts, this would be akin using our unspent budget authority-one time money-to shore up an ongoing revenue shortfall. We say one time because, once that money is gone it's gone forever. Budgeting 101: don't use one time money for ongoing expenditures. Further, we must ask ourselves: is it wise to use the rainy day fund for a self inflicted policy decision? Those are the questions that our legislators are currently wrestling with. I suspect it will get a bit uncomfortable before the dust settles. 

Growing Pains

On Monday we posted a new leadership opportunity for Hudson Schools by announcing our search for a middle level principal. While this is something that had been under consideration for the past several months, it follows a recent press release from the Iowa Department of Education that shared statewide enrollment figures. That communication indicated that Hudson achieved the highest percentage enrollment growth among all districts in the state for certified enrollment. Keep in mind certified enrollment is a depiction of resident students only and does not include those open enrolled. So how did we get here, and better yet; where are we headed? First, some context.

During the 2010-2011 school year, Hudson Schools enrolled 721 students. In the intervening decade, student numbers fluctuated between that 720 and 750, reaching a low water mark of 692 during the 2016-2017 school year. Then, beginning in the 2017-2018 school year, we began reporting enrollment PK-12 as that was the year we launched our statewide voluntary preschool. That first year of operation, we reported 28 students in the program. Over that epoch, staffing levels have flexed to meet the needs of all students throughout the district, sometimes requiring an extra section here or there, or other times not replacing a position when it became vacant. The point is, as enrollment either grows or retracts, so too does our staffing configuration. 

But what has happened to enrollment since 2020-2021 is not a mere fluctuation in enrollment. It has been a steady, if not rapid increase. Think about this. In the 2020-2021 school year, our PK-12 enrollment was 766. This year, enrollment tops 924 across that same grade span. Projections do not seem to suggest a slowdown anytime in the next 5 years. Even more jarring is a comparison between 2010 and 2025. A staggering difference of 203 students.

The question is, what is causing it? Well, we can certainly point to changes in the open enrollment laws that have made it easier for families to choose Hudson Schools. But that isn't the only, or likely even the primary reason for this growth in enrollment. After all when it comes to open enrollment, we have the option to deny those requests when we become full, or even slow open enrollment as residential enrollment growth accelerates. Both of these options have been and will continue to be exercised in our district as we even out our section sizes in open grade levels. The fact of the matter is that open enrollment today is largely limited to existing siblings who are enrolled and employee's children.

Yet, we still must wonder, what happened in 2020 and the subsequent years that sparked our growth? The answer is simple: residential development. When I arrived in Hudson in 2010, Upper Ridge Estates was the only game in town and it was just a little more than half full. In 2020, Ann and I built our home in the second addition of Upper Ridge, and ours was just the second home to be built in that development. Today, that section is full, and another section to the north of us is about 3/4 complete. I haven't counted, but would approximate there are somewhere around 75 homes in our neighborhood. The fact is, in 2010 we were able to swing a bus through that neighborhood on the tail end of an existing route. Today, that is a route in and of itself. 

Upper Ridges is only part of the story. We also have Twin Oaks, Dean Lee, Marian Lane, and Buffalo Trace. Am I missing any? Maybe. There are preliminary discussions occurring right now that likely will result in even more residential development. As of January 2025, there are currently 84 lots in Hudson available for residential construction. 

So then, back to staffing levels. Our staffing plan needs to meet the needs of the students that we are serving. And as I mentioned in the first paragraph, over the years our staffing levels have flexed to meet those needs. Sometimes the decisions are pretty easy calls. If you have 80 students in kindergarten, 4 sections of 20 is not that difficult. On the other hand, if you have 48 it becomes a bit more challenging. We've lived in both worlds and I can promise you that being in the '80 student' camp is much more preferable. 

But the easy calls really do stop there. There are a lot of other issues to be resolved that, well, are lurking in the shadows. For example, when the current 2nd grade class was in kindergarten (our largest current class at 87), we were about 2 weeks into the school year when the teachers pointed out that we didn't have enough restrooms available for the students. This year's first grade started out as 3 sections in kindergarten. We closed open enrollment early and held fast to that decision. This was partly to address the restroom issue, and partly because once we decided to add another 4 section grade level, it would require additional auxiliary positions, namely art. While it was a wise decision at the time, it was short sighted. What happened? Well, over the course of the school year families continued to move into the district. What had started out as a 3 section kindergarten became a 4 section first grade. Adding another classroom also comes with another set of classroom furniture. And Mrs. Betts pointed out to me a few weeks ago: we are out of lockers. So it goes. In 2010, we employed a professional teaching staff of 54. Today that number stands at 72 and will be larger next year. 

What hasn't changed in the past decade and a half is the administrative configuration of the district. For those of you who were around in 2010, you may recall we employed 3 building administrators along with a Director of At-Risk Services. In 2010, one of our administrative positions was eliminated when we had to cut approximately 10% of our general fund expenditures. So here we are. We have decided that now is the time to move forward with the appointment and hiring of a mid level principal specifically to serve grades 5-8. Please believe me when I tell you this decision was not taken lightly. I understand all too well the perception of 'administrative overhead'. But I think we all know the value that strong leadership can bring; not only to the students in that school, but the support they can provide our families, and the instructional leadership they will be able to provide the staff. It is my hope that a middle level principal will help all of us create a visionary framework that will best serve these students now and into the future.

As I wrap this up, it's probably worth mentioning, and wise to think about what is next for the district. Again, enrollment projections do not appear to be slowing anytime soon. Once the current 2nd grade gets to 7th grade we are going to have to figure some things out. Additional auxiliary and supplemental positions will be needed. To help us better understand our trends and trajectories, we have commissioned a study with RSP and Associates to dig deep into these very issues and provide us with the detail and expertise that will be needed to help chart our course. I am excited to learn what the future holds for us. However, there must be no doubt that the future is bright for the Hudson Community School District.

Indeed, its Great to be a Pirate!