Salem schools would see about $15 million more per year under Gov. Tina Kotek’s plans to boost state funding for education — roughly the cost of two teachers at each of the district’s 65 schools.
The money is enough to bring financial stability to Oregon’s second-largest school district, which laid off more than 100 teachers and educators this year while cutting hundreds more vacant jobs.
Heading into the school year, Salem-Keizer School District officials budgeted spending about $27 million more than they bring in, drawing down district savings.
The state school funding increase Kotek proposed would largely close that gap along with other efforts to leave vacant positions unfilled, Superintendent Andrea Castañeda said in an interview Friday. It wouldn’t allow the district to do much more, and falls far short of reversing the roughly $70 million administrators cut from the Salem-Keizer School District budget in the spring.
Castañeda, who has advocated for the state to change the way it calculates school funding, called the governor’s proposal “important and in many ways historic.”
“I join my colleagues in expressing my sincere and humble gratitude for the governor. She made this commitment in the spring and she has seen it through,” Castañeda said.
Castañeda said she’ll join educators in advocating for legislators to approve the governor’s plan, but she said other changes to Oregon’s school funding are still needed.
“What this does is gets us to the point where we are more accurate in understanding what it actually costs to run the schools we have, not deliver the services that we’re responsible for in the future,” she said. “We remain hopeful and eager for the possibility that more structural change could come in this session.”
A boost to state school funding
State money is the main source of funding for general school operations in Oregon. School districts collect local property taxes, but state officials determine how much districts get on top of what they bring in from local taxpayers.
In Salem and across Oregon, that money fell far short of what was needed to keep schools operating this year due to failures to account for the impact of inflation on wages and supplies.
Limited funding was a key driver of tensions over cost of living raises as Portland and Salem-Keizer teachers bargained new contracts this year. Portland teachers went on strike last fall for the first time in state history, while Salem narrowly averted a teacher strike after months of contentious bargaining.
Those tensions prompted Kotek to act.
The governor announced plans Wednesday to change the way the state calculates how much it costs schools to keep running with the employees and services they already have. Three technical changes to the formula would result in about $515 million more allocated to schools from 2025-2027, she said. Castañeda expected that would mean between $15 and $18 million per year more for Salem-Keizer.
Legislators set the state school fund every two years as part of the overall state budget. But the governor proposes her own budget, which informs lawmakers’ discussions. The final amount for Oregon school funding will be set during the 2025 legislative session, which begins in January.
State budget writers during the last biennium made what Castañeda has described as a “grave error” when determining how inflation and rising wages would affect schools.
Legislative analysts predicted the cost of employees would rise just 5.45% over two years. Salem-Keizer’s employee costs are expected to rise 14% in that period due to wage increases and rising health insurance costs. Districts around the state saw similar gaps and many are now facing layoffs.
The result was the money legislators allocated to schools, $10.2 billion, fell far short of its goal of keeping current school operations afloat.
Kotek’s changes include having analysts look at the past 10 years of data, rather than the past 20, to determine how much schools are likely to pay employees in the future.
Challenges remain
Even with the governor’s changes, a gap will remain between the varied services the public expects schools to provide and their ability to do so, Castañeda said.
Legislators have historically fallen short of allocating the amount recommended by a state commission tasked with making sure Oregon operates “a system of highly-effective schools,” Oregon Capital Chronicle reported. That affects every school district in Oregon.
“The gap between this number and the adequacy number is significant and will likely be the work of the future,” Castañeda said.
Despite declining enrollment, educators across the state say they’re dealing with students who have more complicated educational, social and health needs. Schools have become the de-facto provider of everything from mental health counseling to emergency food, and funding hasn’t kept up.
Oregon gives districts extra money for students who cost more to educate because they are low-income, have a disability or are learning English.
But the state limits the share of students a district can receive special education money for at 11% of the student body. Most districts, including Salem-Keizer, have a far higher share of students receiving special education.
Oregon also caps how much money a district can receive for any one student, even if that student has multiple challenges.
The result is that schools are expected to provide far more services than they’re funded for.
It’s a significant issue for Salem-Keizer, which has a high and growing share of students learning English and students with complicated disabilities.
“We actually have a lot of students that have a variety of needs all at once and our costs and our commitment are not capped … but the state funding is,” Castañeda said.
Contact reporter Rachel Alexander: [email protected] or 503-575-1241.
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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.
