Recently, the Public Affairs Research Council of Alabama (PARCA) was contracted by the City of Gulf Shores to develop potential budgets for a possible Gulf Shores City School system. PARCA developed budgets based on projected enrollment, or Average Daily Membership (ADM), numbers.
“What we learned from there is there is enough revenue in this city that will flow from the student through the process to us for us to fund a city school system with no new taxes,” said Gulf Shores Mayor Robert Craft. “On Monday night, we will be presenting a resolution for a vote by this council to consider the formation of a city school board, which is the first step.”
That news was met with applause and cheers from the audience at Monday night’s city council work session.
Craft spoke to the crowd about failed options to enhance the education experience for Gulf Shores students, including a task force and special tax districts. He said he felt the only option left to consider was a city school system.
“The key of where we go from here was what the citizens wanted us to do,” Craft said. “This didn’t need to be a city council decision. This needed the community coming to us.”
The community did just that. In late July, citizens packed city council chambers to present an option for the PARCA study, with a check for $12,000 of the $15,000 needed to complete the study.
Craft said he wanted to find out from the study the level of education the city would financially be able to provide.
Blake Phelps, the city’s economic development coordinator, broke down the PARCA findings for the council.
“They looked at three different models,” Phelps said. “One was existing expenses, basically what we’re spending currently today within our schools on a per student basis. They also went into what they call high-performing and top-performing schools.”
PARCA estimates a Gulf Shores City School System with an ADM of 1,725 students would generate $15,386,796 in revenues through existing revenue sources. PARCA estimates expenses for a Gulf Shores City School System with an ADM of 1,725 students to be between $14.9 - $17.4 million depending upon the academic needs and desires of the community; with $14,905,185 needed for current expenses, $16,449,799 to be on par with high-performing schools and $17,412,275 to be competitive with top-performing schools.
“This actually excludes the 1 mill county-wide special ad valorem tax that was not renewed by the citizens of Baldwin County,” Phelps said. “It’s set to expire next year. We don’t include that in these numbers. It also doesn’t include a portion of a third county-wide sales tax. If that 1 mill is renewed by the county, that’s additional revenues. We wanted to look at a worst-case scenario and be very conservative through this.”
PARCA estimates a Gulf Shores City School System with an ADM of 1,725 students could expect to require between $0 - $2.1 million in additional annual revenues depending upon the academic needs and desires of the community.
Councilman Jason Dyken, also chairman of the finance committee, said the city was in dire straits in 2008. Gulf Shores was operating in the red every year and “basically living on credit cards.” Since then, the city had been able to get to a place financially where it has $24 million in reserves and is even making accelerated debt payments. He said he had spoken to credit agencies to see how much the city needed to have in reserves to get the best possible rate in capital markets and found they had already reached that number.
“By putting more money in reserves, we weren’t getting a return on that investment,” Dyken said. “We looked at how best to reallocate that money. It’s y’alls money. That money is in excess of $2 million a year.”
By reallocating money previously used to bolster the city’s reserves to education, the city would have enough money for the estimate to put it on-par with top-performing schools in the state.
“We’re not doing this to keep schools as they are,” Dyken said. “We’re not talking about just buildings, but improved academic performance. That has always been our perspective as a city through this administration.”
The findings of the PARCA study are posted for the public to see on the city’s website and the public is encouraged to attend next week’s council meeting to provide input on the findings and the city’s action moving forward. Craft said the goal is to have the city’s school system open by fall of 2018.
“We can get there from here, but we don’t have a lot of time to waste,” Craft said.
