The Merrill Area Public Schools Board of Education found out just how serious the budget outlook for the 2011-12 school year was Monday night, and agreed in principal to setting up a 4-tier system of cuts that could result in the loss of up to 35 teachers if the worst case predictions come true and all four tiers are needed to balance the budget.
Uncertainty in what the next biannual budget will mean in state funding for the district is at the root of the planning how deep the district will have to make cuts. Even if funding levels remain as they are now, the district will still have to slash $1.3 million from next year’s budget. Those cuts are in the first tier, as outlined in a budget proposal made by Superintendent Dr. Lisa Snyder.
If the worst case scenario comes to pass, the district would be faced with the prospect of slashing up to $3.6 million from next year’s budget.
“We need to look at what we want our district to look like in one year, two years or five years,” Snyder said.
Because of the way the current labor agreements with the three unions representing teachers, support staff and custodians are set up, layoff notices must be issued by the end of February. The district has until the last day of the school year to call back those on notice before having to start paying unemployment benefits.
With salaries and benefits making up almost 80 percent of the district’s $42 million budget, and the cutting of programs and services already made in previous years, staff reductions are about all the district administrators have left. In the first tier of cuts, 7.5 full time equivalent teaching positions, one custodian and one regular education aide will be cut and one administrative retirement will not be refilled.
In the second tier of cuts, 12 elementary teaching positions would be cut if the state cuts funding to the SAGE program that keeps class sizes small in grades K-3. This would save roughly $800,000 offset by about $120,000 in unemployment costs to the district plus the loss of about $100,000 in the general fund in SAGE money based on this year’s estimates.
The third tier of cuts would be triggered if the state gives no increase in the per pupil funding. The proposed third tier of cuts is set up as an either/or situation where either a program be eliminated at the high school level, which would mean the loss of seven teachers and two custodians, or closing the two rural elementary schools. In both cases the savings to the district is about $600,000.
Snyder also recommended that the board prepare for an ever steeper drop in state aid of between $400,000-800,000. This would take the form of the option not selected in tier 3 being implemented.
The issue of closing one or both of the rural elementary schools didn’t sit well with some board members, or Snyder. The possibility of eliminating a department, such as technical education, business education or band also wasn’t appealing. Snyder said she didn’t make the recommendations lightly.
“I would rather not do either,” Snyder said. “Can we still attract students to our district if we eliminate a department at the high school or close one or two of the rural elementary schools?”
Board member Loretta Baughan made a motion that the closing of either rural school not be considered for the 2011-12 school year. Board President Jeff Verdoorn ruled the motion out of order as the subject wasn’t on the published agenda for the meeting.
Some board members expressed uneasiness with depending on the state legislature having the final biannual budget in place in enough time for the board to know how many tiers of cuts beyond the first will be needed. Finance Director Louise Fischer predicted that with one party controlling both houses and the governor’s office, the process would probably be completed by early spring.
“I think they are just waiting to take office to put their plan into motion,” Fischer said.
Verdoorn said that the board had to be prepared for any scenario given the contract positions for layoffs with the unions. At the very least, the first tier would have to be utilized.
“We are going to have to execute that part of the budget process,” Verdoorn said.
The board doesn’t have to fine tune the cuts until February, and is hoping to get input from the public on what path they would like to see the district take in the cutting process. The board will hold a town hall meeting Thursday, Jan. 6, 2011 at 7 p.m. in the high school auditorium to hear from the public. Verdoorn also strongly recommended that the district hold an advisory referendum on which cuts the public favors most.
“The sooner we can hold that referendum, the better,” he said.
Having the closing of the rural schools included in the possible reductions caused some division on the board, which voted 5-4 to approve the process so that the 35 layoff notices could be issued. Baughan, Brad Kanitz, Bill Jaeger and Jen Seliger voted against the motion to approve the process.
The district still has roughly $500,000 in federal job money to be used next year, and the original proposal was to use these as a way to postpone some of the tier 3 and 4 cuts for one year. Baughan instead moved that these funds be used in whatever manner the board deemed to be the best use, and the motion was approved 9-0.
The board also approved a plan to restructure the district administration by eliminating the co-superintendents of administrative services and instruction services and director of technology. Two new positions, at lower salaries – a director of learning and technology coordinator – would assume many of the duties of the three existing positions while the remainder would be taken on by current administrators.
Snyder said that the recommendations came after a comparison of the MAPS administrative structure to other districts in the area.
“I actually thought this was a huge cut for a district our size,” she said.
The cuts would result in a savings of between $150,000 and $170,000 depending on the salaries of the people hired to fill the two positions. Snyder said that the job descriptions are in line with what entry level administrative job seekers expect, but would want to not set the salaries at such a low point as to not attract the best possible candidates.
Because the contract with administrators runs through the 2011-12 school year, the earliest the restructuring could take effect would be at the end of that school year.
The board approved the proposal 9-0.
The board also approved another one-year contract to continue operating the Merrill Adult Diploma Academy charter school, with half the cost of the full-time teacher and half-time secretary being picked up by NTC under an agreement to provide high school completion courses to adults at the academy.