Tuesday, January 31, 2017


It is that time of year where we get very busy in the schools. Not only are we working on the current year, but we are also working on the next school/fiscal year. As we work on planning the coming year, a large part is played by the state legislature.

Again this year the Iowa Legislature is nearly 365 days late setting SSA (Supplemental State Aid) for schools. The legislature is looking to address this by proposing the elimination of the deadline for setting SSA. For the past seven years, public schools have been woefully underfunded, and it appears that we will again be shorted by the legislature.  This legislature seems to think that schools can operate on an increase that is less than the cost of inflation. When that is combined with a decline in enrollment, many school districts across Iowa are actually looking at having less money for fiscal year (FY) 18 than they have for the current year. North Butler Community Schools is one of those districts.

The way that a school counterbalances this is to not expend all of the money that the state has allotted (Maximum Authorized Budget or MAB) and carry over a surplus (Unspent Authorized Budget or UAB). At the conclusion of FY 16 North Butler Community Schools carried a UAB of $670,200. We are projecting that amount to increase at the end of FY 17. The UAB adds into our MAB that is set by the Iowa Department of Education and allows us a safety net to work with. A district with a budget our size should carry a UAB of roughly $750,000 to $1,000,000. At the end of FY 17, we should fall well within that range.  This allows us to continue with our current programming without having to make staffing or other adjustments despite declining enrollment.

Tax credits for business have played a major role in the lack of funding for schools (see previous blog post, DM Register Article Jan. 12, 2017). As a district, we will make do with what we have and make the best of it!

Doing things the BEARCAT WAY

Even though we are facing challenges with funding from the legislature, we have many fantastic things happening at North Butler Community Schools.
1.     We have continued to employ high-quality teachers from PK-12th grade.
2.     We have added a transitional kindergarten class for our students who may not be completely ready for kindergarten.
3.     We have added a full time counselor at the elementary school.
4.     We have added 1.5 FTE academic and behavior interventionist positions at the elementary.  We anticipate this growing to 2.0 FTE for 17-18.
5.     We have added Project Lead The Way (PLTW) classes for engineering and computer science into the JH/HS curriculum.
6.     The Voc Ag program is adding an aquaponics setup and will be growing fish and vegetables in the near future.
Most of this has come with little or no additional cost to the school district. The increases that we have incurred are, in my opinion, sustainable for the foreseeable future, barring a steep decline in enrollment.

As an administrator, I am very proud of the accomplishments of our staff and students. North Butler finished 10th out of 156 schools in Class 1A in the Bank of Iowa Challenge Cup. This is a platform that looks at all-around programs and involvement of students.  North Butler High School improved its standing on the Iowa School Report Card from commendable to high performing. District wide we set exceptionally high goals for our staff and students, and we met nearly all of those goals. While those things have been happening, our staff is not satisfied with the status quo. They continue to research and look for ways to improve what we are doing. We have groups of staff that have undertaken a pilot project in Authentic Intellectual Work (AIW), we have our Professional Learning Community (PLC) leaders asking to attend more training, and we have teachers asking our instructional coaches to assist them in improving what they are doing in the classroom. I have never seen a staff as eager to learn and improve as the staff at North Butler!

On Monday January 30th, we held a North Butler District Leadership Team meeting. The DLT meets to discuss suggestions, make recommendations to the administration, and make recommendations to the board for our direction as a school district. When functioning properly, administrators do little talking other than to provide updates during these meetings. I have never participated in a leadership team meeting as positive and productive as this past meeting. The district calendar for 17-18 was discussed and adjustments were made according to the input provided. We discussed things that we are doing well as a staff, and things that we can do better as a district. We discussed surveys that will be given to both staff members and community members for feedback. We also discussed how we would use this feedback to improve what we are doing as a staff, administration, board, and district.

Monday evening, January 30th, I attended one of the most impressive educational presentations that I have had the privilege of attending. The North Butler Community Schools Sophomore Class presented projects related to the September 2016 flooding in Greene to the public at the Greene Community Center. The students built their presentations, and also built the program for the evening, reserved the space, provided snacks, secured a guest speaker, and marketed their session. The students and Ms. Stahr did an incredible job in preparing for and making the evening a success. This program included some of the most authentic, real world learning that I have ever seen! The community center was packed, parking was hard to find, and the students did a magnificent job putting together and presenting their program! Hats off to our Sophomore Class. Thank you for setting the bar high for North Butler Community Schools!


Des Moines Register Article, by Mark Lipsman, January 12, 2017

Even though Iowa’s economy is strong, with an unemployment rate of only 3.8 percent, state general fund revenues grew by only $41.9 million (1.2 percent) during the first half of this fiscal year. It is true that prices for Iowa’s primary agricultural commodities are below the levels of a few years ago, but that explains only a portion of the problem. Going back to the 1990s, the tax bases for Iowa’s main revenue sources have been badly eroded through legislative action, aggressive tax avoidance by business, and an evolving economy for which little or no adjustment has been made in state tax law.

What has happened to sales tax provides a good illustration of the tax base erosion that has occurred. In 2000, 43 percent of the value of retail sales in Iowa was subject to sales tax. By 2014, the share of retail sales subject to tax had dropped to under 28 percent. This difference translates to a $335 million reduction is sales tax collections. Legislation enacted last year will shrink sales tax revenues even more.
Another significant contributor to the state’s revenue woes is the number of tax incentives that have been enacted since 2000. Before 2000, the state only offered nine non-administrative tax credits. By 2016 the number of active non-administrative credits had grown to 38. Foreseeing that tax credits could become a significant complication for budget planning the Iowa Department of Revenue in 2005 implemented a program to track and analyze the impacts of tax credits. Starting in 2007, the Department of Revenue began preparing estimates of the impact of tax credits on the state budget. The first estimates completed in April 2007 determined that tax credit claims totaled $165 million during fiscal year 2005. The most recent estimate released last December determined that tax credit claims during fiscal year 2016 rose to $354 million and that during fiscal year 2017, the amount is expected to rise to $404 million.

The argument is often made that the tax credits attract new business to Iowa that would not have otherwise occurred. There is certainly some truth to this claim, but there are also instances where the economic activity almost certainly would have occurred either in the absence of the credits or in response to less generous credits. Also, the tax credit impact estimates many times understate their total fiscal impacts because they often are coupled with sales tax exemptions or refunds and with property tax exemptions, abatements or rebates.

The state would certainly benefit from getting a better understanding of the effectiveness of its many tax credit programs. The tax credit studies done by the Iowa Department of Revenue are good as far as they go in describing the utilization of the credits, but these studies rarely evaluate the economic impacts of the credits or what would happen if they are reduced or eliminated. More extensive analysis of this type can be done, but it would require more resources than are currently available.

Changes in the economy and more aggressive tax management activities by companies doing business in Iowa have also had a significant impact on state tax revenues. For example, Iowa often receives a poor rating on its business climate due to the single fact that it has the highest marginal corporate income tax rate in the country: 12 percent. However, the amount of corporate income tax actually collected in comparison to state gross domestic product ranks Iowa only 30th among all states. The problem with Iowa’s corporate income tax is not that it collects too much revenue, but rather it is obsolete and as a result, highly inequitable. Large multistate corporations are able to manipulate the law, while small Iowa firms bear the full burden of the tax.
When Iowa first established a corporate income tax in 1934, those businesses subject to the tax had most of their sales in Iowa. Today most large businesses subject to the Iowa corporate income tax operate within many states or nationwide. Because Iowa uses the ratio of Iowa sales to total U.S. sales to determine the share of income subject to the Iowa tax and because Iowa does not require corporations to file tax returns on a nationwide combined reporting basis, many large corporations have been able to reduce their Iowa liability to near zero. This is accomplished by shifting revenues out of Iowa and costs into the state. During the period that I managed the Tax Research Section at the Iowa Department of Revenue, we did several estimates of the amount of additional revenue that combined reporting would generate. Most of the estimates were about $100 million.

The easy thing would be to blame the state’s current budget problems on low farm prices, but that is only part of the problem. Policy makers have made some bad decisions over the past two decades that have undermined the integrity of Iowa’s tax structure. Hopefully, legislators and the governor will realize that quick fixes, such as staffing cuts, will not remedy the long-term problem and could very well make the problem worse by making Iowa a less desirable state in which to live, go to college and do business.

Mike Lipsman of West Des Moines is a partner and economist with Strategic Economics Group and a former manager with the Iowa Department of Revenue. Contact: www.economicsgroup.com/

Thursday, January 19, 2017

Board Notes 1-18-17

Last evening the North Butler Board of Education took the following actions;

1.     Approved calendar changes due to weather (please note an  updated calendar will be released as soon as possible).
2.     Approved letting a section of roof out for bids.
3.     Set hearing for 17-18 calendar for 6 PM on February 13th in Allison.
4.     Approved PLC conference registration for PLC leaders.
5.     Approved Equity Report from the DE.
6.     Approved all personnel recommendations.

7.     Approved 2-year contract extension/agreement with North Butler Education Association.

Friday, January 13, 2017

Regular Board Meeting 1-18-17

Mission Statement
To create a positive learning environment that promotes high achievement, responsible citizenship, and success for all.

North Butler Community Schools
Regular Board Meeting Wednesday, January 18, 2017, 5:30 PM
North Butler JH/HS - Media Center, Greene

1.     Call to Order
2.     Review and Approve Agenda
3.     Review and Approve Minutes from December 12, 2016
4.     Review and Approve Financial reports
5.     Public Items of Discussion
6.     Board Items of Discussion
a.     HS Gym seating
b.     TLC Presentation
c.     Flooring/Allison
7.     Approve Job Descriptions
8.     Approve bid letting on roof project for summer 17
9.     Approve weather make-up days
10.  Approve April PD date change
11.  Approve At Risk/Drop Out application to SBRC
12.  Set public hearing on 17-18 calendar
13.  Approve PLC Conference registration
14.  Review Equity report
15.  Personnel Recommendations
16.  Admin Reports
17.  Exempt session to discuss negotiations.
18.  Approve Master Contract
19.  Board Reflections of Meeting
20.  Adjournment

Next Meeting February 13, 2017, 6:00 PM NB Elementary Media Center, Allison.

It’s Great to Be A Bearcat!