Ann Arbor Public Schools is seeking the advice of 8-year-olds on how to cut $25 million from the district’s budget, a move forced by financial mismanagement since the pandemic.

“Students in grades 3 through 8 will have the opportunity to share their feedback by completing age-appropriate surveys in school after Spring Break,” AAPS officials wrote in a letter to parents last week. “Members of the district leadership team have also been meeting with diverse, representative groups of students to hear directly from them about their priorities regarding their school experiences.

“We plan to visit as many schools as possible over the coming weeks to engage with staff and students to get feedback and input,” the letter read.

The student outreach is in addition to a survey of staff, parents, high school students, and community members, as well as three community meetings scheduled for April 8.

AAPS Interim Superintendent Jazz Parks recently announced the undisclosed budget shortfall stems from an increase of 480 staff at a time when student enrollment declined by 1,123, in addition to “well-deserved and well-earned raises” for staff.

“As a result of these factors, our district is facing multi-year budget shortfalls that must be addressed immediately,” Parks wrote in a statement posted to the district’s website. “According to the financial analysis, the district will need to cut approximately $25 million from the 2024-25 operating budget to comply with state and Board of Education requirements.”

Those requirements center on the district’s fund balance as a percentage of expenditures, which has dwindled from 8.2% in 2021 to 4.1% in 2023, below the threshold to trigger an “early warning” from the state after two years.

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The school board has a targeted fund balance of between 6% and 15% of expenditures, according to MLive.

An AAPS audit published last year shows the district would need about $64.5 million in the bank to meet the statewide average fund balance as a percentage of expenditures of 20.3%, or about $47 million to hit the district’s 15% fund balance target.

At the end of fiscal year 2023, AAPS’ balance was $12.8 million. Its general fund revenue that year was $310.3 million.

“Cost containment and improved efficiencies will need to continue to be a focal point for the organization in order to yield positive financial results,” auditors wrote.

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AAPS’ financial conundrum comes despite $30.5 million in extra federal COVID relief from taxpayers in recent years, including more than $19.5 million in the last round of funding.

That’s in addition to an increase in the district’s state funding allowance from $9,530 per pupil in the 2021-22 school year to about $10,609 in 2023-24. When that funding was at $10,102 per pupil in fiscal year 2022-23, AAPS received more than $177.5 million from state taxpayers, the audit shows.

Auditors noted AAPS “invested the one-time federal and state funds into health and well-being of students and staff, and competitive pay.”

Despite warnings from federal officials and financial experts against using one-time money on recurring expenses like salaries, AAPS’ investment in paying staff more creates legacy costs that could be factoring into its current financial troubles.

The district’s unfunded pension liabilities have increased from about $50 million in the 2019-20 school year to $78.5 million in the 2022-23 school year. Health insurance coverage, which the district capped at $13.961 per teacher in 2023, is also up $1.4 million since 2020, the audit shows.

“Despite our best efforts, the magnitude of the budget challenge we are facing will require us to make staff and program reductions,” Parks wrote, blaming the situation on former AAPS Superintendent Jeanice Swift, who resigned in September.

So far, the cuts will focus on central office and administrative staff, and district officials are implementing a hiring freeze as they survey students and others on next moves.

First question: “what are your ideas to generate additional revenue?” According to the survey, 81% of the budget is for employees: pic.twitter.com/j0mQLImCcP

— Anna Hoffman (@shoesonplease) March 23, 2024

In the meantime, folks are weighing in on the situation online, with many skeptical the answers to the district’s problems will come from students still struggling to read.

“If I were a third through 8^th grader participating in this survey, like they’re asking, I’d demand at least three hours of recess per day,” one person posted to X.

If I were a third through 8th grader participating in this survey, like they're asking, I'd demand at least three hours of recess per day.

— Larry F (@wealthbldr96) March 23, 2024

“Democrats wish 3^rd graders could vote,” wrote another.

Others took note of how the district currently spends tax dollars, and the impact on locals.

“Interesting,” one user posted. “They pay A LOT already in property taxes too.”

“This is sad,” another wrote. “Michigan’s public schools need to do better.”

X user Anna Hoffman noted the community survey’s “first question: ‘what are your ideas to generate additional revenue?’ According to the survey, 81% of the budget is for employees.”

Ann Arbor public schools will be crowd sourcing 3rd – 8th graders for solutions to their $25M budget shortfall: pic.twitter.com/FQqkVe4FQu

— Anna Hoffman (@shoesonplease) March 23, 2024