The new head of Cleveland’s public schools told City Council members Monday that the district will surmount the $168 million financial hurdle it now confronts.
Warren Morgan, the CEO of the Cleveland Metropolitan School District, laid out his plans to cut spending to make up for the expiration of federal pandemic aid. CMSD is cutting jobs in the central office and ending its funding for out-of-school programs that it paid for during the coronavirus pandemic.
It’s not the first time CMSD has been required to give state officials a plan to reduce its deficits, he said. The plan is due to the Ohio Department of Education and Workforce on Feb. 29.
“We’ve been here before,” Morgan said at a council caucus meeting. “We will overcome it.”
The district is proposing budget cuts to account for the end of federal Elementary and Secondary School Emergency Relief Fund dollars, also known as ESSER. Without those cuts, CMSD is looking at a negative cash balance of $168 million by the middle of 2026.
Council, Morgan debate MacKenzie Scott grant
A major point of contention for council members was an unrestricted $20 million grant from philanthropist MacKenzie Scott. Prior CEO Eric Gordon said the money would go toward a new “Get More Opportunities Fund.” Under that plan, the grant was slated for student programs, teacher opportunities and facility improvements.
But in November last year, the school board passed a resolution allowing the remaining $16 million to supplant expenses then covered by expiring federal dollars.
“The funds for the MacKenzie Scott gift, if this resolution is passed, will continue to be used for investments for students – the funds that ESSER allowed us to pay for,” Morgan told the board at the time.
Before Monday’s caucus meeting, a dozen council members wrote a letter urging Morgan to restore the money to the Get More Opportunities Fund. Some members repeated their criticism of the decision at the meeting.
Ward 9 Council Member Kevin Conwell told Morgan that the move sent the message to children that “nothing is real.”
“You know what residents were saying in Glenville when I walked Glenville this weekend, and I called you?” Conwell said. “They were saying, ‘Stop the steal.’”
“I want to be clear: We did not take anything away,” Morgan replied to Conwell. “We have to re-figure out the program.”
Morgan said that the MacKenzie Scott grant had always been accounted for as part of the General Fund. He argued that the Get More Opportunities Fund hadn’t been distributed equitably. Most of the dollars had gone to just seven schools, and Campus International had won many of the grants so far, he said.
Morgan asked council to give CMSD time to find ways to fund new grant programs for students.
“We’re going to need time, and I appreciate your thought-partnership with that,” Morgan said. “But as of now, we need to think about our current budget reality, which is in front of us.”
A long-predicted budget cliff
Morgan said that the district had known for some time that the budget crunch was coming. In November 2022, the district projected a $157 million negative unencumbered cash balance in 2026. Gordon, then the CEO, floated the idea of a school levy to bring in new revenue.
Now the district is facing the difficult decisions that it knew were coming, Morgan told council.
“CEO Gordon has always shared that the deficit would be here,” he said.
The last time the state required a deficit reduction plan from CMSD, in 2020, the district proposed closing 30 schools, Morgan said. Instead, voters passed a school levy that held off cuts and closures.
Morgan said state officials reminded him of that plan this time around.
“The first thing the state told me was, ‘You guys never closed those schools,’” he said. “So they said, ‘We want a plan that is realistic.’”
CMSD is not proposing to cut schools or conduct mass teacher layoffs this time. Traditional after-school programs are also not on the chopping block, he said. Morgan said the cuts are focused on the central administrative staff and on programs the central office runs.
Council sounds off
City Council members have no official say over the schools. The mayor of Cleveland has controlled the school district by selecting board members since 1997. But members voiced their displeasure at the caucus meeting.
Richard Starr of Ward 5 wore a shirt printed with a quote that he delivered last week about CMSD’s budget problems: “Who’s Getting Fired?”
Ward 8’s Michael Polensek said he had changed his mind about mayoral control of the schools, which he had once supported. Now, he said, he wants the control to return to the voters.
“I’m for electing the school board once again,” he said, “because I don’t even know who the hell is on the school board today.”
Despite the criticism, Ward 1 Council Member Joe Jones said council stood ready to be Morgan’s companion in improving the schools.
“I want to be, and continue to stay, your partner,” he said. “We have always supported levies in Ward 1, and we have overwhelmingly passed levies in Ward 1, when other neighborhoods did not do that.”
Suggested Reading
CMSD’s $168 million budget hole: Cleveland schools propose cuts to out-of-school programs, layoffs in central office
‘The district can’t bear the load’ of programs funded by expiring federal coronavirus aid, Cleveland schools CEO Warren Morgan says.
Timeline: 25 years of mayoral control over Cleveland public schools
Since 1997, when the Ohio legislature passed a law to reorganize the Cleveland school board, the nine voting members of the board and the district’s CEO have been chosen by the Cleveland mayor.