How Your School Dollars Work

The financial framework that supports the Cobb County School District is crucial in understanding how our tax dollars help our children's education. Throughout this episode, we explain the distinction between the Cobb County School District and the Cobb County government, emphasizing that each entity operates independently with its own budgetary allocations. A significant portion of the school district’s funding—over half—derives from local property taxes, with the remainder coming from state and federal sources. We further delve into the budget development process, which prioritizes instructional spending to enhance student success, reflecting our commitment to educational excellence. Moreover, we discuss the avenues through which families can engage in the budgeting process, ensuring their voices are heard and considered in shaping the educational landscape for their children.

Guest:

David Baker

Useful links from the podcast:

• Cobb Schools Finance Dashboard

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http://www.youtube.com/@TheRealCobbSchools

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The Cobb County School District:

https://www.cobbk12.org

Takeaways:

• The podcast discusses the significant role that tax dollars play in supporting children's education in Cobb County.
• It emphasizes the distinct separation between the Cobb County School District and the Cobb County Government regarding funding sources and management.
• The school district's budget, which amounts to $1.7 billion, allocates over 70% directly to classroom instruction and educational resources.
• Listeners are informed about the transparency and accessibility of the budgeting process for the Cobb County School District, including public participation opportunities.
• The episode clarifies how local property taxes contribute the majority of funding for the school district's budget, with federal funding being minimal.
• The discussion also highlights the cautious financial management style of the Cobb County finance department, which ensures financial stability and flexibility.

Episode Transcript

(00:00):
How your tax dollars supportyour child's learning every day is
next in this episode of theInside Scoop.
Hello and welcome back to theInside Scoop.
I'm David Owen.
If you've ever wondered howbudget decisions show up in your
child's day to day schoollife, you're in the right place.
I'm here today with our chiefFinancial officer, David Baker.

(00:23):
Hello.
Welcome to the podcast.
Thank you.
So the first question thatcomes to my mind is one that I have
heard time and time again.
It's actually kind of startling.
Clarifying the differencebetween Cobb county school district
and Cobb county government.

(00:44):
Yes.
Is that a significant thing interms of like the financial picture,
where the funds come from, et cetera?
Yes, it is.
They are two separate entities.
Cobb County School district isseparate from Cobb county government.
They each have their ownelected governing body, they each
have their own budget, andthey each have their own resources

(01:07):
for funding the activities intheir organization.
The for the school district,we have a seven member board and.
Yeah, they only have five.
That's right, they have five.
We have a seven member boardwho hire the superintendent to supervise
the daily oper, the school district.
So in, in both cases, we get aproperty tax bill and some of that

(01:31):
money goes to the countygovernment and some goes to the Cobb
school system, right?
That's correct.
And for the school district,the over half of our budget is funded
by local property tax.
Okay.
A little less than half isfunded by state money and then a
very small percentage offederal money in the general fund.

(01:54):
Now, that's interestingbecause a lot of people, I guess
because it's the federalgovernment, people assume that that's
a big chunk of money.
But in the grand scheme ofthings, it's not nearly as big as
what we take in at the stateand local.
No, not in the general fund.
We do have idea and titles 1,2, 3 and 4 that are accounted for
separately, but not in thegeneral fund.
Those are federal programs.

(02:15):
That's correct.
Okay.
All right.
Well, that's interesting to know.
So this is a little bit of acurve ball, maybe aside, but, you
know, a lot of discussion hasbeen happening about the possibility
of doing away totally with theDepartment of Education.
I don't know if that's goingto be a reality.
I don't think anybody knowswhere it's going yet.
But how would you see thatimpacting Cobb schools on the funding

(02:39):
resources side?
You know, at this time, wedon't have enough information to
definitively say, sure, what'sgoing to happen.
However, we, we do believethat we will not see a significant
change in the level of fundingfor Cobb schools.
We may get it in a differentway, either from the state or in

(03:00):
a different format, but thatmakes sense.
We don't anticipate anychanges in the level of funding.
So as it is now, basically,money comes from us, goes to Washington,
and then we get that back orpart of it back, right?
That's correct.
But what clarifying whatyou're saying is, the likelihood

(03:21):
would be not that money goesaway totally, but we kind of cut
out the middleman.
It would most likely be at thestate level that those things would
be managed.
Yes, that's exactly right.
All right, just making sureI'm understanding where you're going
with that.
Okay.
So looking at the funds thatwe get here in the school district
and specific to our children'sclassrooms, our students classrooms,

(03:45):
there's a budget process, right?
Yes.
Can you explain a little bitabout what that budget process is
and how it's used to determinethe best places for the money to
go?
I mean, I might have anopinion about where the money should
go.
And you would have an opinion?
Well, you're the cfo, so you win.

(04:06):
But people have differentopinions about where that goes.
How does that process work tomake sure that we are taking care
of our teachers and ourstudents, that the learning keeps
happening and all of that?
Right.
So the school district has a$1.7 billion general fund budget.
Good grief.
And over 70% of that budget isallocated directly to the instructional

(04:31):
category for classroom education.
I believe that our budgetreflects the boards and the district's
mission of student success.
Achieving student success.
Sure.
And.
That'S how we take that intoaccount when we develop the annual

(04:52):
budget each year is what'sgoing to.
How is that going to best getus to student success?
So from.
From a practical standpoint, in.
In the budget process, how do you.
I mean, do you basically askteachers what they need in their
classrooms?
The teachers tell their principal.
The principal tells the next.

(05:12):
You know, does it go up the chain?
Is what I'm getting at.
How does that all work?
It does.
But one exercise that we doeach year during the budget development
process is we will visit witheach district department about their
needs for the upcoming school year.
And then we take thoserequests and those aspects into consideration

(05:33):
as we develop the budget.
So that we can optimize thosefunds and achieve that high level
of student performance andstudent success.
Yeah, that's as much as itsounds like a rah rah line for PR
sake.
The reality is, when A schoolsystem is scoring so high on test

(05:54):
scores and studentperformance, there's all the more
pressure in the following year.
That's right.
To make sure that's not lostand even to gain a little bit more
as we go along.
Right?
Yes.
And that applies to the budget.
Budget process as well.
Yes.
Progress every year.
Okay.
No pressure.
Okay.
So when it comes to theoverall process, that.

(06:16):
That wraps up pretty much in,what is it, April for you guys?
Yes.
We present the tentativebudget typically in April.
Okay.
At that point, it becomes theboard's budget.
Okay.
And it's kind of who owns it.
That's right.
That's right.
Up to that point, it's thesuperintendent's budget.

(06:36):
Once we present in April, thenit becomes the board's budget, and
we typically adopt the budgetin May.
Okay.
So the board has it in theirhands for a month.
And is that electronic as well?
Yes, we.
Once financial information ispresented to the board, we will post

(06:56):
that online for the public tosee and state PDF.
Or something like that?
That's correct.
Okay.
I mean, I remember some ofthose budget meetings you had that
we still have.
Holy cow.
Those things are intimidating.
And they've got spreadsheetsthat open out and just make you almost

(07:17):
weep.
So, okay, so the board getsthe budget.
It's available electronically.
Does that mean the public haselectronic access as well?
They do.
And they would be able to goonline to see that.
There are a couple of waysthat they can get online to see that.
If they go to the Cobb CountySchool District website, click on

(07:38):
the menu in the upper lefthand corner, go to the community
section.
Then the budget is the firstitem that they can select in that
list.
All right.
And we could put that in theshow notes or description for the
audience to look at and enjoy,depending on what your interest is.
So how do families have achance to speak up?

(08:01):
I mean, I know the system ingeneral works for the benefit of
the students and the teachers,but they're, like I said earlier,
they're people with differentopinions, different perspectives.
How can families have a say inthat overall process?
Now, that's a great question.
We've got really three optionsthat are available to them.

(08:21):
First is participating in thepublic comment section at each board
work session or each boardvoting session that we have each
month.
It's never too early.
If someone has a request or aconsideration that they would like
to be considered in theupcoming budget, they can make that
known during that time.
We also have budget hearingsduring the budget adoption process

(08:47):
that they can come share andtime for public comment at that time,
too.
And then also, they can alsoalways contact board members, especially
the board member whorepresents the post in which they
live, and let them know whatthey would like to see included in
the upcoming budget.
And the board member, afterthe board owns the budget, so to

(09:08):
speak, at that point, theboard member has direct input.
How would that work?
Is that an executive session thing?
Is that a discussion in thepublic meetings kind of thing?
Well, that's correct.
They would have input at that point.
Many times they may visit withthe superintendent, who then lets
us know that we want toinclude that in the budget.

(09:31):
Or email back and forth.
Email opportunity in that sense.
And those emails don't justget routed to spam.
They really are.
They really are considered.
Okay.
All right.
Well, we often hear of Cobb'sfinance department as being reserved
or maybe cautious, and somepeople think too cautious.

(09:54):
But we've seen that cautionplay out favorably for the school
district in many occasionssince I've been here.
What does that mean in practice?
What causes other financialentities to refer to Cobb's finance
department as being very reserved?

(10:14):
What does that mean?
Well, we typically take acautious approach to budget development,
which assumes that actualrevenues will be very closely matched
to budgeted revenues.
But expenditures would come in.
Actual expenditures will beless than budgeted expenditures.
Okay.
It's very important for us tohave a healthy fund balance as well,

(10:38):
which provides financialflexibility for the district.
Now, you say fund balance.
What is that?
So fund balance, if we want toput that on a more personal level,
fund balance would be maybe anindividual savings account.
We'll say that accumulatedfund balance that we've had over
the years.
So that way those funds areavailable if an unforeseen expenditure

(11:01):
comes up or something such as that.
Okay.
So it's just like a familysaving up a little bit to set aside
just a hold for unforeseenemergencies and that sort of thing,
right?
That's correct.
Or to get you through a gap.
That's right.
Temporary, temporary need foradditional funding.
Yes.
Okay.
Well, that.
That's certainly a healthy wayto do it.

(11:23):
How much of that funding hasto be or do you plan to set aside
each year?
Board policy says that we haveto have a certain amount of that
unassigned fund balance.
And we want to make sure that we.
Accommodate the expendituresthat are necessary in the classroom

(11:47):
for instruction.
And then anything that is leftover after that, then we will keep
that for another day.
Okay.
So basically, it's kind oflike a household savings account.
Right.
And we're trying to havesomething set aside in case something
goes wrong financially.
Some unforeseen emergencycomes up.

(12:09):
Like I remember years ago.
Clarkdale Elementary, I thinkit was, had a big flood and they
suddenly had to build a schoolwithout having that in the SPLOST
plan or any of that?
Yes.
So that's the sort of thingthat you're talking about?
Yes.
Any unforeseen expenditures orcircumstances that come up that allows

(12:30):
us the flex, the financialflexibility to accommodate those
and the needs.
School board would decide whatthose emergency.
How much of that money, likehow much do you have to set aside?
I know the old Dave Ramseyapproach for a household was six
months of savings aside.
That's a lot of money.
That's right.
Board policy requires that weset aside one month of unassigned

(12:54):
fund balance.
That's your minimum requirement?
That's the minimum requirement.
We strive for more than that.
We strive for two months.
And right now we're at notquite a month and a half.
Okay.
All right.
And that should bridge the gaps.
If we ever encounter somethinglike a change of revenue stream locations
or anything like that.

(13:15):
You should be prepared for that.
That's correct.
So one of the things Iremember being discussed and this
kind of crosses the streams, I guess.
I mentioned ED SPLOST at one point.
That we have been able to bedebt free.
From because Ed SPLOST hasallowed us to retire long term debt,

(13:37):
Right?
Yes.
So that seems to me to be partof the overall financial picture
that's positive about Cobb schools.
Right.
Is that we haven't had aMiller's rate increase.
We haven't.
Have this bond debt that otherschool districts have to pay for.
Is that accurate?
That's right.
SPLOST is a great program.

(13:58):
We greatly appreciate thevoters support for that program over
the last few years, but thatthe benefit of that program and SPLOST
is a $0.01 sales tax on goodsand services purchased in Cobb County.
And the benefit of the SPLOSTprogram is that it's estimated that

(14:20):
approximately 30 to 35% ofsploshed revenues actually come from
people who live outside thecounty who come here to shop or visit
or for entertainment orbusiness purposes.
It's almost like a fundraiser.
That's correct.
Where you're getting matchingfunds for your couch.
I didn't mean to interrupt you.
I'm sorry.
No, that's right.
But that's.

(14:41):
The SPLOST program is awonderful program for our capital
improvements for additionalschools, school modifications, safety
and security.
So I know you don't likeBragging I do.
So are we unique in this regard?
Because you know, there areother school districts in the metro

(15:02):
area, some bigger than us,that have bigger budgets.
But the way you manage thosebudgets and is very, very important.
Are we unique in the way thatwe manage our budget?
Well, we manage our budgetvery cautiously and we want to make
sure that we are here andfinancially stable.

(15:24):
That also goes into our AAAcredit ratings and that says not
only a lot about the financialcondition of the district, but also
about the operations of thedistrict and how well it's managed
and operated as well.
Frugality of it, I guess youcall it.
So one of the benefits of thefinance department running things

(15:47):
in such a cautious or reservedmanner is that we don't find ourselves
behind the eight ball.
We don't encounter a lot ofsurprises financially.
Right, right, that's correct.
As opposed to some schooldistricts nearby.
I won't ask you to respond to that.

(16:08):
Okay, so is there anythingelse that we need to throw in here
for the benefit of our viewers?
I know one thing that you guysdo that is probably not very common
is you are perhaps the mosttransparent finance operation I've
ever seen.
Just looking at the websiteand all of the documentation you

(16:30):
put there that's not requiredby law.
Right?
Right, right, that's correct.
We.
And thank you for that.
But we try to.
We put our budget informationout on our website.
We put all of our financialreports out there on the website,
audit reports, our AAA creditrating, both long term and short

(16:50):
term.
And many other financial reports.
Their financial metrics areout there as well.
Yeah, I was going to say youhave a, like a dashboard thing.
Can you recall any of thethings on it?
I know, I'm just throwing.
No, it has a lot of ourrevenue, sources of revenue, things
like that.
We have details of it, detailsof that.

(17:11):
We have a popular reportthat's a little easier to read than
a longer financial report.
So there's a lot oftransparency that you guys provide
on the website.
So, David, thank you so muchfor coming in.
Thank you for having me beingtransparent with us here.
I know we don't have time togo in depth the budget line by line,
but it is very helpful forpeople to understand at least what's

(17:33):
there and how they can get toit if they want to dig deeper.
So those links are going to beavailable in the show notes or description
for this episode.
And of course, don't forget tolike subscribe and share this episode
so that others can benefitfrom this too.
You'll find the podcast onSpotify, Apple, iHeart and all the

(17:53):
usual places to get your podcasts.
Thank you for listening to theInside Scoop, a podcast produced
by the Cobb County School.