Key to securing passage of House Bill 1182, the sales tax to raise K-12 teacher pay, was Rep. Lee Schoenbeck’s (R-5/Watertown) amendment specifying that three percent of the new revenue go toward raising instructor pay at our vo-techs. With the increase of the state sales tax from 4% to 4.5% effective June 1 projected to raise $107 million, the Schoenbeck Amendment should put about $3.2 million toward the vo-techs. If my rough count from the vo-techs’ online directories is correct, that should give about 320 instructors an average raise of about $10,000, which by my most hopeful interpretation of the K-12 funding formula is a bigger raise than 98% of K-12 teachers will see.
Some instructors at Southeast Technical Institute in Sioux Falls may not see any raise. STI president Jeff Holcomb told his staff Thursday that the school will likely have to lay off staff to fill a $2-million deficit:
In the last three years, enrollment has gone down and students are taking fewer credit hours. In one year from 2014 to 2015, enrollment fell 8 percent; Total credit hours were down 9 percent.
The cuts will help shrink the 10 percent [deficit]. Southeast Tech President Jeff Holcomb told his staff Thursday night.
“It’s just a blunt truth. I said to them, there’s no easy way to say this,” Holcomb said.
There is not much clarity about how many employees this could affect. Holcomb says we likely will not know until next month.
“We want to exhaust every other adjustment first, before we get to any staff changes,” Holcomb said [Brady Mallory, “Southeast Tech Leaders Talk About ‘Likely’ Job Cuts,” KELO-TV, 2016.04.08].
Wait a minute: Governor Daugaard has emphasizing the importance of vocational education throughout his time in office. Aren’t kids listening?
Nope—they’re too busy going to work:
“Our low unemployment rate really is the highest competitor,” Southeast Tech President Jeff Holcomb said. “So, if you have an individual that has some aptitude, there’s such a demand for their skills that they go right to work.”
Declining enrollment has led to a $2 million gap in the incoming revenue and the operational expenses at STI, Holcomb said. The decline started around 2013, Holcomb said. Between the 2014-2015 school year and the current year, the school saw a drop of 5,000 credits [Megan Raposa, “STI Layoffs Latest Setback for Sioux Falls Higher Ed,” that Sioux Falls paper, 2016.04.08].
That’s a strange dynamic: South Dakota is short on workers. The Governor says we need to beef up our vo-tech schools to produce more workers. But workers are in such short supply that employers aren’t waiting for the vo-techs to crank out all the labor they need; they’re taking high school graduates and getting what work they can out of them and paying enough that, at least short-term, young workers are saying more school isn’t worth the time and tuition.
Even if students decide to put off short-term gains for long-term investment in a technical degree, they can get that degree cheaper elsewhere:
Government aid for tech schools in South Dakota is low compared to all surrounding states. Meanwhile, the amount students pay in tuition and fees each year is higher than all neighboring states — more than double what students pay in Nebraska and Wyoming.
On average, a student can save roughly $1,500 on tuition by crossing the border to Iowa.
“Both Iowa and Minnesota, the states kick in a much larger amount and share to technical education than we do in South Dakota,” said Kent Alberty, a member of the Southeast Tech Council [Patrick Anderson, “Students Pay More with Tech School Fee Hike,” that Sioux Falls paper, 2016.03.18].
Southeast has taken out $20 million in bonding to support new building on campus. Students shoulder two thirds of that debt service, and the state Board of Education hiked student fees another $5 per credit this year to cover that cost.
The Bureau of Labor Statistics says the average wage for postsecondary vocational instructors in South Dakota as of May 2015 was $50,540. At that salary, STI would have to lay off 40 of its instructors, more than 40% of its teaching staff, to close the $2-million budget gap. They have about a hundred other staff to choose from (four security officers, three vice-presidents…) for savings, but Sioux Falls school board president Kent Alberty says the cuts will be across the board.