Is Hyde County’s fight for school funds over?
By Kip Tabb | Outer Banks Voice on August 2, 2022
Commissioners restore $400,000 in cuts, another $75,000 could be sought
On July 28, after a month-long dispute over school funding, the Hyde County Board of Commissioners voted 3-2 to increase the county’s share of the annual schools budget to the $1.712 million figure that the schools had requested.
That was up from the $1.3 million the commissioners previously approved on June 27, a $400,000 shortfall that would have had cascading financial implications for the schools. It also triggered a request for arbitration from the school board, although that avenue failed to resolve the impasse.
With the commissioners’ July 28 decision to restore that funding, the question now is whether the school will receive an additional $75,000 in county funds that Hyde Board of Education attorney Richard Schwartz says is owed to them..
At the heart of this Hyde County school budget battle is a county trying to cope with a shrinking tax base made worse by Hurricane Dorian’s recovery costs.
“Hyde County is struggling to generate revenue this coming year as it sits at the bottom of our revaluation cycle, compounded by a severe decline in housing values since the destruction of Hurricane Dorian,” wrote the Hyde County Manager Kris Noble in a voicemail email.
The county also needed to replenish its reserve fund which was depleted by Hurricane Dorian and the COVID pandemic. The fund had fallen below state guidelines, and commissioners voted to raise the county property tax and cut funding to every department except the sheriff’s office.
The potential loss of $400,000 of the county’s contribution to the school’s budget would also have jeopardized other funding dollars, according to Hyde County Schools Superintendent Dr. Melanie Shaver.
Shaver, who just started his term on July 1, said that in a smaller school district like Hyde County, another source of school funding affected would have been annual state funding for small schools.
“When you look at funding for small schools, there is a local [removal] rule,” she said. “If you are below what you had been funded at 95% per pupil, you could also lose your funding for small schools. We receive about $1.8 million in small school funding. This is where many of our teachers and staff come from.
Hyde County as well as North Carolina schools in general had already lost Hold Harmless funds the state had provided to help districts through COVID. The Hold Harmless funds have kept the state contribution to school budgets at pre-COVID levels. Because public school funding is based on student enrollment, Hyde County, which has seen declining enrollment, stood to lose more funding.
“If we lost the extra funding for the small school system on top of the state cuts [Hold Harmless] funds, in addition to the $400,000 cut in local funds, schools in Hyde County would effectively be unable to operate,” Board of Education Chair Angela Todd wrote in an email.
Board of Education attorney Schwartz told The Voice that funding schools in North Carolina is incredibly complex, with multiple sources of revenue. He added that county commissioners likely didn’t know how much the cuts would affect the district.
“I don’t think they realized the impact,” he said.
However, there may still be an unfinished task.
Because the attempt to find a funding solution through arbitration was unsuccessful, Schwartz said that under a state formula, schools in Hyde County actually owe $1.787 million in county funding. by that calculation, $75,000 more than the original budget request of $1.712 million.
The school board meets on August 2 and Todd expects the new budget figure to be part of the discussion.
“Whether or not the BOE accepts the $1,712 [million] or go ahead with requiring the full statutory funding formula, I don’t have an answer to that yet. The regular meeting of the BOE is [today] and I expect we will discuss the matter with counsel for the BOE before determining our next step,” she wrote.