As the full impact of the new budgeting changes for Hawai'i's public schools settles in, principals are beginning to weigh how to absorb monetary losses without affecting their classrooms — or use extra money to the most strategic advantage.

Those anticipating losses are looking at everything from trimming custodial and clerical positions to creative ways to share positions — librarians for example — among schools in their complexes.

Meanwhile, those gaining money are debating beefing up tutoring programs, buying textbooks, adding a security system or an additional security guard, or maybe a new teacher or educational aide to reduce class size or student-to-teacher ratio.

All are wrestling with having to add to their academic and leadership skills a new set of spreadsheet smarts expected of a CEO making decisions over multimillion-dollar budgets.

"It's not what we as educators are really trained to do," said Catherine Payne, principal of Farrington High, the state's largest school, of the new budgeting authority. "It's a big scramble."

But none will be making decisions in a vacuum, and in the coming days most will be consulting with School Community Councils for input from all stakeholders.

As it stands, $3.3 million will shift among schools under a new "weighted student formula," with 129 schools losing money and 123 gaining. But school-by-school figures released so far have been preliminary; the projected spending formula won't be finalized until next week, with additional calculations once enrollment projections for next year are finalized in November.

The formula, which was approved Thursday night by the Board of Education, is part of the Reinventing Education Act passed by the 2004 Legislature. The purpose of the formula is to redistribute education money based on student need, with higher weights given to such needs as non-English speakers and impoverished students.

Beginning next year, the formula will increase or decrease school budgets by 10 percent — a level that minimizes the impact on schools standing to lose big money but also leaves schools that are gaining without enough additional money to make significant change.

Payne, for instance, is happy to have an additional estimated $131,825, to expand a remedial reading and writing program and improve school security, but admits it's not enough to make a measurable difference in a budget that's about $13 million overall for a school of 2,579 in an impoverished urban area.

CUTS MAY MEAN LAYOFFS

James Toyooka, principal of Lili'uokalani Elementary School, which will lose more money than any other elementary campus, said full implementation under the current formula over the next four years will be nothing short of catastrophic.

Capping his loss at 10 percent next year will allow him to maintain all staff positions that work directly with children, but the school might lose a custodian. "It doesn't affect the teaching line for this year," he said.

Without changes to the formula, however, the picture beyond next year looks bleak, he said.

"It will be hard the first year, more difficult the second. The third year, forget it. It will be impossible. We're not going to survive," he said.

Many principals also are wondering how to ease the impact on employees. In the Farrington complex, they've been told to hold off telling anyone their jobs may be lost.

"I'm hoping no bodies have to be lost," said Diane Riate, administrative services assistant for the Farrington complex, which includes about a dozen schools — about half of which will lose money, while the others gain. "We'll pool our ideas together and see how we (in the complex) can help each other.

"Among the employees, everyone is afraid of losing their jobs. But at my smaller schools, looking at 10 percent, we don't have to get rid of teachers. We can work it out someplace else. Maybe we can kind of work it out that the person losing can come to the schools gaining."

Even so, Riate thinks workloads could increase for those remaining, especially clerical and custodial staff.

SCHOOLS WEIGH NEEDS

Hana High and Elementary School on Maui, which includes elementary, middle and high schools on one campus, will see the largest loss among combination schools, with about $98,000 in cuts that principal Richard Paul must make next year — the first year of implementation.

Paul said he hopes he won't lose positions in the first year. He was budgeted for three educational assistants but didn't fill the positions because he couldn't find qualified people, and now hopes the losses will be a wash.

But already he's thinking about the second year, when he might have to give up a vice principal (the school has two for 360 students) and possibly a counselor (the school has two.) Down the road he realizes he may have to weigh the costs of and need for a librarian.

"We share the community library," he said. "So it might be cheaper to buy library cards for the kids."

GAINS NOT SIGNIFICANT

Waipahu High will gain the most under the new formula, with an extra $146,772 approximately next year. But principal Pat Pedersen doesn't yet know what the school will do with the extra money, except that it will go to further initiatives already under way.

For example, Waipahu has launched a school-to-work program and has started looking at computer-aided instruction that will allow students to work at their own pace, while freeing teachers to spend more one-on-one time with students at different skill levels.

She also will be looking into ways to improve effective teaching practices, as well as bring in other curricula that research has shown to be effective.

The condition of school facilities are another concern. But Pedersen knows that the new financing system will mean big changes.

"If we do the same practices, we will probably get the same results," she said. "We have to think outside traditional teaching practice. It's an exciting time."

One premise under the weighted student formula is that some schools have been receiving more than their fair share of budget allocations. However, this has a big impact on small schools, which are required to have the same support positions as larger schools.

Roger Kim, principal of Mililani Middle School, where high enrollment has forced the school onto a multitrack schedule, wonders whether it wouldn't be better to consolidate some of the smaller schools.

However, Mililani Middle still stands to gain money, perhaps enough to pay for another teacher or counselor and some extras, depending on what the School Community Council supports.

Kim said the story would be different if the school was given 25 percent of the money it had expected to gain, as officials with the DOE had originally recommended before the board dropped it to 10 percent.

"What we do is kind of crimped by the 10 percent," Kim said. "Basically, the 10 percent is to ease the schools losing money and it doesn't make a whole lot of difference to those that are gaining resources."

The story is similar at Washington Middle School, where estimated gains might allow the school to get another part-time teacher or tutor, but probably will be spent on updating instructional material, such as textbooks or technology.

"It's not enough to look at any kind of teaching position," principal Michael Harano said.

Harano said looking at the efforts to make the distribution of money equitable made him realize that Washington Middle, which has fallen into the strictest penalties under the federal No Child Left Behind Act, could have had $1 million more over the past decade.

"We know (the gains) are at the expense of other schools and we're not happy with that," he said. "But what might we have done at our school?"

PLANNING FOR FUTURE

Schools won't know exactly how much they are gaining and losing until the end of next week, and won't get exact budget figures until mid-November, based on projected enrollments for next year.

Randy Moore, DOE program manager in charge of implementing the formula, said it likely will change again during the coming year.

Moore offered some advice, knowing that even with a changing formula, some schools will lose money.

"We're encouraging not the lop-off approach, but to look at four years down the road, what you're going to be getting, and what should the school look like with the resources you'll be getting," he said.

"Start from a clean slate and build up. Once you've got what the organization looks like in four years, then the task is to manage the transition."

Reach Beverly Creamer at bcreamer@honoluluadvertiser.com and Treena Shapiro at tshapiro@honoluluadvertiser.com.