Rochester School Board Hears About Potential Cuts to Combat $16.4 Million Deficit
Board may consider busing, program cuts in 2011-12 budget.
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Rochester Community Schools leaders took a first look this week at an "unprecedented" $16.4 million budget shortfall facing the district and its 14,900 students.
Bill Mull, assistant superintendent for finance, prepared the school board for tough decisions ahead — decisions that he said will affect some of the crucial programs that attract families to Rochester schools.
The district faces a projected $16.4 million deficit in the 2011-12 school year. The projection includes a proposed funding cut from the state of $300 per pupil. It also includes a loss of federal EduJobs program money that was designed to save teacher jobs (an additional $170 per pupil).
Other cuts, including a projected decrease of 63 students and the loss of special education grant money, combined with a predicted increase in some expenditures, equal a $1,100-per-student anticipated loss for next year, Mull said.
As part of his budget presentation, Mull presented board members with seven pages of line-item budget cuts the district has approved over the last 10 years. Those include 210 full-time positions and $27.9 million.
"For the next school year, you won't see a list of 75 little things that will be cut; we've already done that," said Mull, who spoke for about an hour. "We've already picked at the low-hanging fruit, and now we're at the point where we're getting into the meat of our district.
"It will be difficult to not affect our programs."
Bus services, learning consultants are potential cuts
Mull presented board members with a list of potential savings, the biggest being the elimination of bus services for grades 9-12. The move would save $1.3 million. The savings would be tripled if busing was eliminated for K-12 students. Special education busing would still be required.
Another potential savings would be deep cuts to the Learning Consultant program that Mull described as one "cornerstone of our program in Rochester." It's a $3 million program and involves 40 full-time teachers and para-educators.
Superintendent David Pruneau said he and members of his administrative team will meet in the next month to carve out a proposed budget plan for the board to consider.
Other potential cuts outlined by Mull include:
- Cutting all school-level and district-level department budgets by 5 percent, saving $443,000.
- Eliminating half of the district's media specialists and all of the media assistants, saving $1.3 million.
- Eliminating the police liaison program.
- Cutting four full-time special education positions.
- Fifty percent reductions in replacement funds for school buses, technology and instructional furniture.
All of the potential cuts would save $8.1 million — half of what is needed. The cuts don't include several new programs the board is being asked to consider this year. Most notable is the switch from half-day to full-day kindergarten, which would cost about $1 million the first year and about $500,000 in subsequent years. (See related story).
What about the fund balance?
The district is operating at a 19 percent fund balance, the second highest in Oakland County (behind the Bloomfield Hills district). The county average is 8.6 percent. Board members debated Monday night how much to borrow from the balance to help make up for next year's shortfall.
The fund balance equals about $30 million, the cost of two months of operation.
"I don't think anyone at home, if they had two to three months of income in the bank, would say they were rich," Mull said.
"We are very well positioned, because we have built a fund balance reserve over the past several years to get ready for this. But do we want to be the first district to eliminate transportation, but still have a fund balance?"
Board member Lisa Nowak supports holding onto the fund balance. "I don't have any confidence that the Legislature is going to fight their way out of the mire anytime soon," Nowack said. "I think white knights are on the endangered species list when it comes to Lansing."
Board secretary Gerald Moore suggested funding half of the deficit through the fund balance.
The board plans a study session April 25 to hear the superintendent's and administrators' recommendations.
"This is going to be difficult for parents and students, but it is a fact of public education in southeast Michigan," said Board President Barb Cenko.
Doug Hill, president of the Rochester Education Association, which represents the district's 900 teachers, encouraged board members to keep in contact with state lawmakers.
Beth Talbert said she and other board members met last week with Republican State Sen. Jim Marleau, who represents the school district in Lansing. They tried to meet with Rep. Tom McMillin, the Rochester Hills Republican, but did not hear back from him, she said.
"It was not a very pleasant day — it's a depressing place to be right now," she said of her Lansing visit. "It is disheartening. Some members of our state legislature still believe schools are funded through property taxes. As a board, we need to try to educate the people who represent us on where we get our funding."
The 2011-12 school district budget is scheduled to be approved June 27.
Rochester Hills Mom
7:27 am on Wednesday, March 23, 2011
If you are a parent of a student in the RCS district and haven't been aware that more financial cuts are coming then you've not been paying attention! While the ultimate goal of the cuts should be that they have the least impact on our students in the classroom I think that this goal will be nearly impossible. Now is the time, more than ever, for parents to attend school board meetings and contact school board members to let their opinions about potential cuts be heard!
Jeremy Nielson
7:56 pm on Friday, April 15, 2011
I agree. It's unfortunate that our school board has let spending increase every year and locked us into contracts that will cause us to lay off teachers or eliminate valuable educational programs.
The next board meeting is Monday, April 25th at 7:00pm. The meeting will be a long one, discussing the budget and how to handle the deficit.
For those who can't make it, the meetings are available online at http://rochester.ezstream.com.
Dave D
11:12 am on Wednesday, March 23, 2011
Lets also encourage parents to look at the current pay rate and sheer quantity of administrators in the RCS. On their web page there is a downloadable document which lists any employees which are highly compensated (over $100K per year). The last time I looked there were 40+ people on that list, some of them VERY highly compensated. I added up the cost (salary and benefits) and it worked out to $6 million. Dave Pruneau currently makes in excess of $200K when you combine salary and benefits. We need to evaluate decreasing the size of the administration (not a token amount either) as well as opening their contracts for re-nogotiation.
Mike Reno
5:12 pm on Wednesday, March 23, 2011
Let's say, for the sake of discussion, you were to entirely eliminate executive administration. Every Executive Director, Assistant Supt, and the Superintendent. What would you save? Less than $2 million out of a $158 million dollar budget.
Don't misunderstand my point... I'm not trying to defend administrators. I think that many of the executive administration of the district could go and we wouldn't miss a beat.
But the financial problems the district is facing is not because they are top-heavy.
Dave D
11:16 am on Wednesday, March 23, 2011
Now I see that Dave Pruneau has "retired" from Rochester and has been named as Superintendent of a school district in Illinois for a starting salary of $212K per year. Nice double-dip Dave....too bad it's on our backs.
RSharp
4:58 pm on Wednesday, March 23, 2011
Everyone seems to dance around the issue, but it's time to recognize where the vast majority of the district's budget is committed: salary and benefits. It is foolish, shortsighted and unrealistic to think that the budget shortfall in this and future years can be resolved with one-time “fixes,” drawing on the fund balance or cutting around the edges.
No one will like the necessary medicine, and there will be howling from all involved, but there will have to be sacrifices made by all employees, at all levels. This means every employee will need to contribute more to his own health care and pension costs; it means that the administration must regain control over working conditions, scheduling flexibility, and class sizes; and it means opening union contracts to negotiate all of this at every level. It means personal pain and sacrifice.
The district’s core financial problem is not the significant cuts in state aid. Those cuts have simply brought the deficit issue to a head in an accelerated fashion. And nibbling away at the list of cuts Mr. Mull has proposed will plainly not get the job done. It’s more like attempting to avoid reality. Plainly and simply, the district is running its business in an unsustainable fashion and that situation is grounded in its unsustainable personnel costs.
Mike Reno
5:07 pm on Wednesday, March 23, 2011
Well said, RSharp.
Also note that this should come as no surprise to anyone who has been watching.
The district has been living for over two years now on Federal Government handouts (so-called stimulus funds as well as "edujobs" funding). They have know this is coming for some time, yet they all but ignored the problem.
And, they also committed to a three year union contract that did almost nothing to control costs. They suggest there was structural change... it decreased costs by one-tenth of one percent.
And, they just agree to "protect" athletics... an area where they spend nearly $1000 per participant.
So what is left for academics?
No, this is not Lansings fault.
Mike Reno
5:14 pm on Wednesday, March 23, 2011
By the way, Patch Reporters... Jeremy Nielsen offered some FANTASTIC points... why did you quote the union prez, but not Mr. Nielsen?
Debra
9:54 pm on Wednesday, March 23, 2011
Well said RSharp, Rochester has to balance the budget or as I understand it, from the proposal of the new laws, some one else will. I have given up many benefits and hourly dollars in the very recent past, in order to keep my job. I think the educator unions will have to rethink some of their requests in the future also. Labor is usually one of the largest costs in any business,
the school system is not so different from most businesses, they all need to be financially sound to function well.
Rebecca
11:29 pm on Wednesday, March 23, 2011
I as an employee of RCS have taken a 25% paycut, I wish other unions within the district would be willing to take more of a cut, so that maybe everybody would be able to keep their jobs. Hard times call for hard measures.
TriciaY
3:16 pm on Friday, March 25, 2011
I am an RCS parent with 3 in school and one entering. I hate the idea of cuts. Education is key for all children. But you can't squeeze orange juice out of a rock. We could go back and forth on the how we got into this mess but it will solve nothing. The cuts will come anyway because they are needed. The only thing that we can do it make sure we talk to our legislators. And try to ensure that the cuts are done as equally as possible. Example pay cuts across the board from the top to the bottom.
Jeremy Nielson
10:08 pm on Friday, April 1, 2011
Unfortunately there won't be pay cuts. There will only be layoff notices and program eliminations.
Contrast that to the $3.05 million the school board increased wages and benefits when they signed the new REA contract in December. The average 3% wage increases that they received, and the increase in benefits costs came at the expense of hiring 45 more teachers. (or 45 teachers that could've retained their positions if they end up being laid off).
I truly wish Rochester didn't have a spending problem. It would make it easier to blame Lansing for the $300 per pupil cut. But our district spent the Obama ARRA stimulus money, that they knew was going to run out. They wasted the Edujobs money, a one-time windfall. They knew Pensions and Retirements would increase. Yet they made promises and accepted long-term costs they should've known they couldn't keep.
Our district spent $105 million in 2000, and next year's budget starts at $163 million. Our board president said the increase is because our enrollment went up significantly - but it's only gone up 11%, and our per-pupil expenditures went up 50%. Our district has a spending problem.
Our school board has the final say in contracts, negotiations, and the budget. It seems they're doing a very poor job, and if we don't fix the problems soon, what happens to Rochester Schools?
Rochester Mom
3:36 pm on Friday, April 1, 2011
I wish articles like this about the $16.4 million in cuts would specifically spell out for the community that the $300 per pupil cuts that are coming from Lansing are only equal to about $4.5 million. That leaves another $12 million or so that is not part of Lansing/Snyder cuts. There is talk of a state wide union talk of a strike from teachers that would include Rochester teachers to send a message to Lansing. Their feeling is that with a "mob mentality" that they could not all be fired for an illegal strike. Yet in RCS, we have a $30 million fund balance that could easily absorb the $4.5 million. The problem is we are looking at another $12 million on top of that. Is that really worth a strike that would affect the students and divide our community? And isn't part of the $12 million (of the $16.4 million) in RCS due to the increased salary/benefits with latest REA teacher contract? So really? A strike or work stoppage?
Kristin Bull
7:22 am on Friday, April 15, 2011
Here's a look at how Royal Oak is responding to its budget shortfall: teacher layoffs, along with increases in athletic fee and class sizes. Board voted Thursday night. http://royaloak.patch.com/articles/royal-oak-to-lay-off-27-teachers-boost-class-size-and-sports-fees
Jeremy Nielson
9:06 am on Friday, April 15, 2011
Thanks for the head's up Kristin!
When I look at their budget reports, I see a couple of trends that also weigh on their decision.
1. Enrollment has dropped nearly 20% over the last 10 years
2. Employees (teachers especially) dedicated to instructional services have decreased every year since 2002
3. The district is maintaining a 15% fund balance as a result of their decisions, instead of spending it down.
I would guess that the layoffs are going to have a minimal impact to students considering their enrollment numbers. Similarly to Rochester, their expenses have gone up over the past 10 years - which translates to increased wages and benefits as those are 70-85% of a district's budget.
Consider this for a moment.
- If it costs more to keep the same number of employees each year, when times get tough you'll need to have layoffs.
- If the costs stayed stable and steady, you could instead spend those increases on MORE teachers each year. When times get tough, layoffs may still be necessary but you won't be taking away educators who could be teaching students.
As a dad, I'm thinking the second one makes more sense to me. Spend more money on more teachers, not spending more money on fewer teachers.
What do you think?
Mike Reno
9:14 am on Friday, April 15, 2011
That's sad for those entry level teachers. Of course, they will follow the "Last In, First Out" layoff strategy, regardless of whether the new teachers are incredibly talented and dedicated. And of course, they'll keep those with higher seniority, regardless of whether they are talented, or simply deadwood.
Someone needs to explain how their actions are putting "kids first", as they always claim to do.
Instead, what they are doing is putting their committement to providing service behind their commitment to the unions.
Joshua Raymond
11:23 am on Friday, April 15, 2011
With a deficit like we are facing, I see 3 options.
1) Cut drastically
2) Increase state funding per pupil
3) Increase number of pupils
We will have to do #1. There is no way we are getting around cuts. Unfortunately for the employees, the high percentage spent on salary and benefits means they will be part of the cuts.
I don't think we can do #2. That is out of our hands. Should there be a reversal in Lansing, that should be looked as extra $ but should not be counted on for budget planning now.
We do have an opportunity with #3 that I've approached the RCS Board of Education about. Many parents of gifted students have left Rochester Schools for other schools or other districts. By creating a magnet school for gifted students, these families would know that RCS is taking the needs of advanced & gifted students seriously and would help convince those in our district to return bringing their $ with them. With Troy ending its gifted education, there are many there feeling abandoned. If we open the gifted magnet school up under Limited Schools of Choice, we could attract students to the district along with their $.
Grosse Pointe has such a program and the only additional funds are a 1/2 time coordinator. It has attracted families to move to Grosse Pointe for their schools.
With meeting the needs of gifted students, bringing funding to RCS, saving jobs, and attracting families to our community, it is a win for everyone!
http://RochesterSAGE.wordpress.com
Mike Reno
11:42 am on Friday, April 15, 2011
Great suggestion, Joshua. I'm sure the board thanked you for your comments.
One little known, or often overlooked fact is that approximately 17% of the school-aged children in Rochester attended other schools. Their parents choose to send them elsewhere.
The board likes to chalk it up to religous reasons. I've talked to plenty of these parents, and I have yet to meet one that says that is the primary reason. They'll often say it's a bonus, but in general they prefer to send their children to a school with a more rigorous curriculum.
Joshua Raymond
12:05 pm on Friday, April 15, 2011
Mike, while I knew it was a significant number, I hadn't realized it was that high. We currently have 14,787 students attending RCS. If those are 83% of the students who could be attending, it means there are approximately 17,816 potential students in the district or 3,029 students who could be attending RCS who are not. If we could attract 1/3 (1,010) of them back at the estimated per pupil funds (state, local, & federal) of $10,824, that is $10,932,240. That would make a huge dent in our projected $16.4 million deficit we are facing next year. Plus, no teachers would be let go, but we would have to bring on additional teachers.
As you mentioned, many are leaving RCS for a more rigorous curriculum. It seems to be in everyone's best interest to at least offer the option of schools with advanced or rigorous curriculum to bring our students back. Having options for full day kindergarten, International Baccalaureate schools, and magnet schools for gifted students could bring in significantly more money to the district than any additional expenses incurred.
Jeremy Nielson
12:56 pm on Friday, April 15, 2011
That's a fantastic point, Joshua.
Not to mention, our district charges $14,000 per year for non-district students to attend Rochester. Understandably, we have zero students taking advantage of that opportunity.
Wouldn't it be great if Rochester could have a program that was on-par with Cranbrook, Roeper, and the International Academy? Or even Holy Family, down the street? Cost effective for non-district residents, and offering stiff competition to the local academies to provide the best education to our kids.
Joshua Raymond
4:25 pm on Friday, April 15, 2011
It's odd. While I've seen Debra Hartman post on here, I don't think I've seen any of the Board of Education members post on Patch. It seems this would be a great way for them to get the pulse of the community. Even if they don't feel they should add to the conversation, a quick "I'm listening to your concerns" post would be welcome.