County, School Board Working Together to Close FY21 Budget Gap

Facing a projected combined budget gap for the current fiscal year of $52 million-$68.8 million, County government and Arlington Public Schools (APS) today outlined options for closing that gap during a joint work session.

“The coronavirus pandemic has caused a serious loss of revenue at the very moment that our community needs additional support and services to get through the severe economic impact of the pandemic on Arlington families,” County Board Chair Libby Garvey said. “From the beginning of this pandemic, the County and APS have closely collaborated to address the pandemic and its fallout. It is critical that we continue that close collaboration in the months to come, as we work to close the FY21 budget gap while maintaining our social safety net and meeting the needs of our students.”

“The pandemic is challenging our educational system and our budget. Through biweekly financial updates, we have been able to work with the County to access vital CARES Act funding and other financial support to address operational needs benefiting our students,” said APS School Board Chair Monique O’Grady. “That collaboration has proven to be a successful model that will aid us as we continue to address anticipated shortfalls and even more hurdles for the next fiscal year.” She continued, “Although a lot of work still needs to be done, I want to thank our colleagues on the County Board and the County Manager for their partnership through these difficult times.”

The two boards heard reports on the Fiscal Year 2021 Budget and on the County/APS collaboration to make high-speed internet access available to every APS student.

Projected estimated combined budget gap of $52.4 million-$68.8 million
County Manager Mark Schwartz explained that the County expects revenues for FY 2021 to fall between $28.4 million and $37.8 million below what was projected at the time of the FY 2021 Budget adoption in April. Superintendent Durán said that APS is facing an estimated budget gap at this time of between $24 million and $31 million.

The APS budget gap continues to fluctuate and is based on continued unknowns including more possible revenue loss, more possible savings and more costs as APS works to return students to in-person learning while continuing to provide distance learning. The school district is examining its current practices and reviewing the budget with its advisory committees to look for possible operational changes that may result in savings in both the current fiscal year and in FY 2022.

These choices will come on the heels of a tight FY 2020 budget which included no staff compensation increase, a class size increase, delayed maintenance, and the significant use of reserves to close a budget gap.

Both boards said they will need to use a combination of close-out funds from Fiscal Year 2020, federal CARES Act relief funding, debt refinancing, state COVID-19 relief funding, and service cuts to close their budget gaps. Both also expressed concern that Fiscal Year 2022, which begins July 1, 2021, will pose further significant budget challenges in the face of the continuing pandemic and sluggish economy.

“There are still so many unknowns,” Garvey said. “We don’t know whether the federal government will provide further pandemic relief funding, or, if it does, when that might happen or whether any new package will include funding for state and local governments. We have to be prepared for a very difficult situation in FY 2022.”

Collaborating to provide students internet access
The two boards highlighted their successful collaboration to provide all APS students with internet access for distance learning. Arlington County and Comcast have partnered with APS to provide a free year of Internet Essentials to help students connect from home. Amazon is donating 500 personal mobile wireless hotspots for students who cannot access WiFi where they learn. And in partnership with the County, APS has begun broadcasting its WiFi network to serve households within range of Abingdon, Campbell and Randolph elementary schools, and Gunston Middle School. Five more schools will go live this week, with more to come soon.

Next steps
The County Board will finalize the FY 2020 budget close-out at its November Meeting, where it also will give the Manager guidance for building his Proposed FY 2022 Budget.

The School Board is considering its FY 2022 budget guidance at this week’s Board meeting and will consider its FY 2020 budget close-out later this year.