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School District to Spend Part of Fund Balance to Help Budget Shortfall

'This is a different direction than I have ever taken as superintendent here,' Superintendent David Pruneau tells the board.

Rochester Board of Education members informally agreed Monday night to spend down the school district's fund balance to help cushion

The district has about a $30 million fund balance; board members will consider cutting that in half when they adopt the 2011-12 budget in two months.

"We think that it is a reasonable fund balance for next year," said Robert Mull, assistant superintendent of business, explaining that keeping a fund balance ensures the board will avoid borrowing money for cash flow purposes.

"We don't have many choices," board member Marty Sibert said, addding that the board may need to "take some courageous action at some point."

"The alternative is to impact the classroom," Gerald Moore said. He said he is comfortable with the budget plan.

"I am not comfortable, but I can accept this ... if I can delay those cuts even for a year," board member Lisa Nowak said. "This is, I hope, the worst-case scenario."

Board member Chuck Coutteau urged the board to remember the kids and give them the tools they need to be successful. 

Board member Beth Talbert agreed and said she is "not opposed philosophically to spending down the fund balance" and that she cannot justify removing funds from the classroom until necessary. 

"We are between a rock and a hard place here ...we are at that watershed moment," Talbert said. 

Superintendent David Pruneau agreed. "This is a different direction than I have ever taken as superintendent here," said Pruneau, who retires in June after five years with the district.

Monday night's budget discussion was in response to recommendations from Pruneau and others for budget cuts.

Board members must approve the 2011-12 budget by the end of June. Their discussion and hearings on the budget will coincide with debate in the state Legislature about Gov. Rick Snyder's budget proposal, which originally included a $300-per-pupil funding cut.

In Rochester, the proposed budget calls for the elimination of media assistants, resulting in a savings of $633,723, and the restructuring of paraeducators that would save the district more than $700,000.

Terry Hetrick, a paraeducator at for 13 years, addressed the board. "This is not a done deal; the state has not made its decision yet," Hetrick said. "Many of us are required to be highly qualified.  We are paid at below poverty or at poverty level. We do it because we are dedicated."

A 50 percent reduction of school bus replacement and maintenance costs will save an additional $1 million.

Lynnette Teller, a media specialist at , asked the board why the school state aid fund is carrying a surplus while at the same time bringing down budget cuts.

Parent Jeremy Nielsen addressed the board, sharing his concerns over the proposed budget for next school year. 

"I am worried that we are going to be using hope as a financial strategy," Nielsen said. "Hoping it gets better next year is not a good idea. I urge the school board to make tough decisions so our kids can continue to have the best education possible."

Kristin Bull April 26, 2011 at 05:19 PM
Janet — if the fund balance were to be kept at around $30 million, do you have specific ideas or recommendations about what should be cut (besides possibly busing)? It is good to hear parents' perspective.
Debra Hartman April 28, 2011 at 07:39 PM
Please note the following clarifications: 1. Athletics - The general fund subsidy for athletics on a per-pupil basis based on all students eligible to participate in athletics (grades 7-12) is approximately $207. The county average is $244. 2. Corporate Sponsors - The Rochester Community Schools Foundation actively solicits donations from corporations, organizations and individuals to support the arts, academics and athletics. Past corporate donors include but are not limited to Dell and Pepsi. 3. Pensions - Pensions for public school employees are controlled by the State of Michigan. Local Boards of Education do not have the authority to move staff from a defined benefit to a defined contribution plan. Debbi Hartman, Rochester Community Schools
Debra Hartman April 28, 2011 at 09:19 PM
Number of students eligible to participate in athletics: 7,325 (2009-10 school year). 46% participated in at least one sport. The state sets the retirement rate. It can vary from year to year. There is a school funding powerpoint presentation from the 4.25.11 Board of Education meeting at the following link: http://www.rochester.k12.mi.us/pages/5248/powerpoint-presentations-from-board-meetings
Clara T April 28, 2011 at 10:20 PM
So are you saying 3369 Rochester students participate in athletics?
Jeremy Nielson April 29, 2011 at 05:50 PM
I'm actually quite concerned about where the district will be in 2-3 years. From what I can see, the school board has known about the current funding situation since at least 2009. Bill Mull predicted our situation precisely back in 2009 - including the $16 million deficit. And a couple of board members alluded on Monday that they know they will have to layoff teachers in the 2012-13 school year. From what I can tell, if the district doesn't make significant changes we'll be facing a $21 million deficit next year. What I can't understand - is why would our school board willingly choose to ignore the warning signs and keep spending more money and approve new contracts that increase our costs, when they know it's going to lead to teachers being laid off and cutting educational programs for our kids? As a parent, I don't understand why the school board would put us in that position.

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