Hundreds of layoffs ahead for Salem-Keizer, superintendent says

Salem schools will need to lay off hundreds of employees at the end of the school year to balance the district’s budget even after steps to reduce expenses in recent months.

Superintendent Andrea Castaneda outlined the impending cuts during Tuesday night’s school board meeting, saying regardless of the outcome of bargaining with the district’s two employee unions, Salem-Keizer School District will see its largest employee reduction since the Great Recession.

She said in an interview that district leaders are seeking to cut about $70 million ahead of the 2024-25 school year to bring district expenses in line with revenue.

Castaneda expects to announce a first round of cuts at a Dec. 12 school board meeting.

She said her proposal will target employees, contracts and programs in the district’s central offices, rather than teachers and people working directly with students. They will account for roughly $12 million.

“Our team has spent weeks going through every single line of this budget. And for each one, we literally asked ourselves the question: ‘Is this expense more important than a person who’s serving students in a building?’” she said.

A second round of cuts, announced in late winter or early spring, will hit schools directly. Those cuts will be made considering the feedback district leaders gathered in October and November at six “community conversations” held at local high schools. At those, parents shared their priorities and what they valued at their kids’ schools.

Affected employees would be laid off July 1, 2024.

The deep cuts are despite a somewhat rosier financial forecast for the district after the first quarter of the fiscal year, which began in July. Projections at the start of the year called for a negative balance of $38 million in district financial reserves by the end of the 2024-25 school year — a mathematical impossibility since the district cannot spend money it doesn’t have.

Through a near-total hiring freeze at the district level, Castaneda said the district’s projected hole is now closer to $17 million. 

“We’re behaving differently and those new behaviors are having a positive impact on the health of our district,” she said at the meeting. “This is excellent news. It is not everything.”

A significant factor in the depth of the budget problem is that federal Covid relief money, which has paid for hundreds of district employees over the past three years, runs out next July.

The district spent much of that money on one-time expenses like masks and Chromebooks, but currently has nearly 200 people whose salaries come at least in part from the federal money.

They include school nurses, mentors who help guide teachers, and teachers targeted at some of the highest-need elementary schools in the district, according to a list provided to Salem Reporter.

Castaneda said the district has about $23 million in recurring expenses now paid for with Covid funds. Those people and contracts will need to be paid next year from other sources, or cut.

Castaneda’s goal is to make deeper cuts so the district’s expenses are in line with revenue as enrollment, and thus state funding, decreases.

She said the Salem-Keizer district faces larger issues tied to Oregon’s property tax system, which allows wealthier districts like Portland and Beaverton to raise more money from property taxes. Although the state school fund is intended to equalize resources between school districts, districts keep any money they get from extra voter-approved levies.

Salem voters, she said, are unlikely to approve a levy, and a tax measure would raise less in Salem because of the large amount of tax-exempt state owned land.

Castaneda in an interview declined to specify which positions she’s considering cutting in December, or if there would include salary reductions for top district executives. Their recent pay increases have become a rallying cry for union leaders amid tense negotiations.

Tyler Scialo-Lakeberg, president of the teacher union, and Edie Buchanan, president of the classified union, both spoke critically of district leaders during Tuesday’sboard meeting. They said administrators have failed to prioritize safety for employees and students amid a rise in assaults on staff this school year.

Castaneda began her job as superintendent July 1 and is paid $285,000 per year, according to her contract. 

Many of the district’s highest-paid executives received raises between 10% and 22% in 2022 as part of a larger district salary adjustment intended to bring their pay in line with market wages, district spokesman Aaron Harada said.

Administrators across the district, most of whom are school principals and assistant principals, received an average increase of 7.85% due to the pay study, on top of cost of living and experience-based increases.

Licensed teachers received an additional 1.5% in 2022, on top of a 3% cost of living increase and $1,750 in retention bonuses paid in 2022 and 2023. Classified workers, a group including classroom assistants and bus drivers, got a raise of 5% on top of the cost of living increase.

Negotiations with both unions are headed to mediation. A first session with teachers is scheduled for Dec. 6, and for classified workers on Dec. 28.

What questions do you have about the Salem-Keizer School District budget and union negotiations? Managing Editor Rachel Alexander will compile common questions into a Q&A story in the coming weeks. Send her your queries at [email protected].

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Rachel Alexander is Salem Reporter’s managing editor. She joined Salem Reporter when it was founded in 2018 and covers city news, education, nonprofits and a little bit of everything else. She’s been a journalist in Oregon and Washington for a decade. Outside of work, she’s a skater and board member with Salem’s Cherry City Roller Derby and can often be found with her nose buried in a book.