Lacking Enough Insurance, Ike’s Aftermath Hurting Galveston Schools

November 11, 2008

Hurricane Ike, which swamped Galveston in September and forced hundreds of students off the island, is now drying up revenue sources for public, private and charter schools, some of which may close.

State funding for public and charter schools, based on enrollment, will drop because many students whose homes were destroyed have been unable to return. At private schools, fewer students means less revenue.

What’s more, tax revenue for public schools will drop as values on homes and businesses decline.

Facing declining revenue and mounting costs in Ike’s aftermath, the leaders of Galveston’s public, private and charter schools are contemplating budget cuts, layoffs and, in some cases, school closures, the Galveston Daily News reported.

The city’s public school district, which lost 30 percent of its students, has held off on repairing two flooded elementary schools because it can’t afford to fix schools that sustained more than 50 percent damage. If district trustees ultimately decide to close those schools, some teachers and staff members will lose their jobs, said Superintendent Lynne Cleveland.

“The belt gets significantly tighter next year,” said Arnold Proctor, assistant superintendent of business and operations.

O’Connell College Preparatory School, the county’s only Catholic high school, lost 14 students and $98,000 in tuition, the newspaper reported. In response, O’Connell has eliminated positions, changed full-time teachers to part time and consolidated classes to trim costs.

Ambassador’s Preparatory School, a relatively new charter school, lost 17 students, or 12 percent of its enrollment. The loss of state funding per student, the main source of revenue for the school, has created a dire financial situation, Superintendent Pat Williams said.

“We have another month or so to make decisions in terms of our budget,” she said. “We’re trying to be cautious with spending … but if we see our numbers are not affordable for faculty and staff, we might have to evaluate cutting some of our positions.”

Few schools were fully insured for flood damage. Galveston Independent School District operates with an $80.3 million budget. While the district had $1 billion of wind insurance coverage, it had only enough flood insurance to cover $500,000 of damage to each building and $500,000 of damage to the contents.

“The expectation from a hurricane was wind damage, not flood,” Proctor said.

The insurance payout is not enough to cover the more than $10 million in damage to district facilities, including schools, a transportation building and a maintenance building. While the Federal Emergency Management Agency will pay for 75 percent of the cost to rebuild, the district is responsible for the other 25 percent. That could translate into millions of dollars out of the district’s budget – which was $6 million in the red before Hurricane Ike.

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