The Board of Education urged the Montgomery County Council yesterday [Tuesday, November 26] to approve higher spending affordability guidelines that will govern expenditures for next year's operating budget for the Montgomery County Public Schools and other government agencies and departments.

Representing the Board of Education, Vice President Patricia B. O'Neill spoke at a public hearing last night convened by the Council in advance of its review and decision on the new guidelines. The following is the edited text of her prepared statement:

"Good evening, Mr. Silverman and members of the County Council. The Board asks you to set guidelines that will continue to support our collective goal of enhancing the academic achievement of each student in Montgomery County Public Schools.

"The Board applauds the Council's unwavering focus on supporting our children while at the same time ensuring that the County's financial situation is not at risk. The Board recognizes and respects the need for Montgomery County to establish spending affordability guidelines. Yesterday, the Management and Fiscal Policy (MFP) Committee recommended that the allocations for Montgomery County Public Schools be set at Maintenance of Effort. The MFP committee also recommended that property tax rates be set at the current rates, rather than at the charter limit. The current rate exceeds the charter limit by $45 million. We realize that the budget estimates upon which the recommendations are made are preliminary and may change by the spring. However, the economic reports are a sobering reminder of the difficult choices that are ahead of us as a community. The economy remains flat at best in the face of the enormous challenges that we face.

"And there are challenges. As you know, the demographic changes under way in the Montgomery County Public Schools have continued to transform the landscape of the school system. In the last year alone, the number of non-English speaking students has grown by 920 children -- reflecting nearly half of the total enrollment growth of 2,059 students. They are heavily clustered in the most urbanized region of the school system, a central core stretching from Takoma Park to Germantown. The region claims half of the county's entire elementary school enrollment, 75 percent of all African American and Hispanic students in elementary school, 75 percent of all English language learners in elementary school, and 80 percent of all elementary children receiving meal support. In addition, the concentration of poverty and diversity in this region is growing. The region's 60 elementary schools (out of a systemwide total of 125) include the most challenged schools in the county. The needs of these schools underscore the urgency of the county's ongoing academic reforms. The challenges we face are complex and made even more difficult by the projected budget shortfalls.

"Our own accountability measures have identified significant disparities in student achievement by race, ethnicity, poverty, limited English proficiency, and disability. These differences take on a new dimension under the federal requirements of the No Child Left Behind Act, in which mandatory standards of adequate yearly progress toward state proficiency goals will have to be met, including goals for each group in each school.

"The Board fully understands and appreciates the magnitude of the financial problems facing the county. We have already cut $51.4 million from the budget in the last three years, largely to offset program improvements. Last year's freeze on expenditures cut an additional $10 million. Another freeze already has been imposed this year. Specific efforts have been made to protect schools from cuts. A zero-based budgeting process has been used to redirect financial and personnel resources to Board of Education priorities and initiatives. The cumulative effect of these actions, however, does not overcome the fiscal pressures on a school system as big as ours.

"Obviously, cuts will have to be made in preparation for FY 2004. Preliminary recommendations are being considered for significant reductions in current programs and services, both in the central offices and schools. Administrative costs already are at just 2.1 percent of expenditures, the lowest amount ever for this budget category. But we will need to cut back even further, including areas such as technology, curriculum and instructional development, student and community services, and staff development. Such reductions are a limited remedy when the goal should be to improve and support academic quality, not erode it.

"Yet the economic picture is troublesome. This coming year, the maintenance of a quality school system will compete with transportation, safety and security, and other services for our vast and growing community. At the state and county levels, a significant revenue shortfall is expected. However, we are confident that based on your consistent support for better schools and the mutually cooperative relationship we have built jointly and with the county executive, the FY 2004 Operating Budget will maximize opportunities to serve all our children. With this in mind, we ask that you set the Spending Affordability Guidelines at a sufficiently high but realistic level subject to review next April when revenue forecasts become more precise.

"Thank you for this opportunity to participate in this public hearing. I welcome your questions."