Wednesday, April 7, 2010

The List and the 800 pound gorilla

Prior to Tuesday's meeting, Joe Paradise handed us a survey for the list of 31 potential budget cuts (up from 28 items) and asked each Board member to note which items they would consider and which should be withdrawn. The list will be amended based on consensus.

Trying to evaluate this list with the biggest piece of the puzzle still missing (i.e., our labor costs) is difficult at best. We must anticipate there will be no contract resolution with the NFT between now and adoption of next year's budget. So all we have to work with are the costs associated with our Support Staff. The next step in our negotiations with NESPA is to await the Fact Finder's opinion, which hopefully should be available in the next few weeks.

In the meantime we continue to look at next year's budget from different angles. Earlier today I passed along a couple pages worth of questions/observations to Mr. Paradise in hopes it might unearth some savings. And I know that he and Dr. Muenker have been working diligently to come up with ideas to trim spending without impacting student programs. I want to be optimistic about our chances but we have to work based on what we have in front of us. And until we can address our labor costs, this means we have to work the dreaded list. Speaking of which . . .

Three more items were added to the original 28:
#29) Reduce or eliminate school nurses (this is likely limited by existing contractual language and labor rules)
#30) Increase fees charged for student parking permits, currently $25
#31) Charge for sending transcripts (approximately 1,200 to 1,800 requests annually)

Speaking for myself, I find virtually everything on the list to be objectionable to some degree, but there are a few I am not willing to consider (and will fill out my survey accordingly):
#2) Eliminate Middle School Co-Curricular activities
#5) Eliminate Elementary Guidance Counselors
#17) Reduce/eliminate instrumental itinerant music
#22) Increase class size at the High School
#25) Eliminate Kindergarten

There are another 15+ items I prefer come off the list but I want to learn more about them before forming a final opinion. The rest are open to discussion. Hopefully we will cull this list down by the next public meeting so you all know which items are truly being considered.

One other note about last night's meeting - The Board clarified the misinformation reported recently in literature distributed through State Rep Frank Farry's office. Simply stated, there is no 13.6% increase in State funding of basic education. We are planning for a 2% increase as is part of the proposed budget in Harrisburg. We believe there is confusion with the $2.2 million that was given to Neshaminy via Federal funds (not State funds) for special ed and new initiatives (not basic ed). Part of that money was used in our current year's budget and the rest will be applied to next year's. Sorry to disappoint those of you misled into thinking we got a windfall of new revenue.
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23 comments:

sportsfan said...

Everyone has a case for their item on the list but eliminating the middle school sports could be the worst. Not only do sports keep the kids occupied after school but it is an important learning tool for the real world. Winning, losing, dealing with coaches, teammates, work ethic and other situations.

But it might already be TOO LATE.

I guess the word has leaked to the outside world, where people in other districts have heard that we might eliminate these sports and they are in disbelief. News travels fast with todays technology. So what I am saying is that a small savings (eliminating things on the list) is bringing our district down to the level of Bristol and Morrisville. I am not talking about sports here, but our money. We want people moving into Neshaminy, not moving out.

KClarinet said...

Is there any state requirement or a legal liability issue with eliminating the nurses?

Neo Con said...

Being new to this blogging community I wonder if there was a thread that answered the question of whether outsourcing the labor force was an all or nothing option. While outsourcing will definitely close the budget gap, is it necessary to gut the whole body, or use a scalpel to dissect the more costly functions? I do respect the savings potential for outsourcing the whole, BUT, will it create a chaotic atmosphere if so many services are changed over at one time? I know that there is a learning curve on how to handle new vendors and services. Is there any discussion on how this transfer will be handled to ensure that the public will not get lost in the confusion?

William O'Connor said...

Great point, sportsfan. A responsible budget is important but cuts that hurt education only serve to discourage families from moving to Neshaminy, and that will impact property values.

KC, I do think there are some issues which make that measure a non starter.

Neo Con, in the event we cannot reach an agreement with NESPA and we do go the route of outsourcing, we have the option of picking which services stay and which go. To ease some of your concerns about the transition, in the case of transportation, usually about 90% of the existing bus drivers will be rehired by the outsource vendor. I also believe most of the other service vendors will rehire a majority of existing staff, so this should minimize transition issues. I'm sure there will be a few bumps along the way but nothing fatal.

RVN6869 said...

I have been on the sidelines for awhile and it appears to me that the Genie is out of the bottle. There is a 30 million dollar savings being thought about. It will be hard for the support staff to show that much of a savings.

Last year, they had a chance to settle the contract. It is a year later and no contract. The school board looked at other ways to save money. Now jobs are on the line. If it comes to cutting school programs or jobs, I feel the jobs are the ones that are going first.

But, as mentioned in the thread. The teachers pension and insurance have to be addressed. I'm sure it will take a long time to change the pension, but it really needs to be fixed. The Medical has to and can be addressed now.

Until this change happens, we will be doing the same thing years on end. Even if the School board is able to make cuts and no increase this year. We will have to dig deeper into our pockets in the future due to their pension and how it reacts from year to year.

I would like to know one thing. Now that my tax dollars pay for their pension funds that are based on the stocks and bonds, etc. Do we get the benefits when it does well. Do we get some interest for our investments? It would only seem fair, seeing that we have to bail them out.

srodos said...

I believe that it is somewhat disingenuous to create a list of over 30 ways to cut the projected deficit without attaching an approximate dollar value to each item. In my opinion you did not go far enough in your effort to preserve the educational value of the district.
Middle School IOP should be retained along with all reading specialists,librarians and Special Ed Instructional Assistants.
Closing the Alternative School is a slap in the face to all students and parents who look to this facility to preserve and enhance education. Throwing these students out of Neshaminy and into what I would consider no more than a school which will hold their place until our student is of age to leave that school is a disservice to our students and our residents.
The loss of pride in our district will be matched by the loss of value of our homes.
The proposed elimination of pre-first,Kindergarten and Kindergarten specials flies in the face of all known studies and is in direct opposition to the front page story in yesterday's Courier-Times.

acs said...

Don't waste your time worrying about home values worry outrageous taxes for union labor.....$32M extra over 5 years.

jls08 said...

Many of the items currently on 'the list' are unacceptable to me because any short-term savings is far out-weighed by long-term negative effects on the quality of education. The items on the list that would be acceptable to me:

#4 - charge for extra use of pools. This raises revenue without impacting quality of education.

#10 - Activity fees. I hate that we even have to consider this and I understand all of the arguments about this hitting lower income students the most, but if it comes down to activity fees or cutting programs, I would pick the lesser of these 2 evils and say go with the fees.

#13 - share middle school librarians in complex. Unless I am missing something, this only impacts 1 building so it only eliminates 1 position, right? It's something!

#14, #16 - increase facility usage and aquatic program fees. Again, raises revenue and doesn't cut education. That has to be the priority.

#22 - increase class sizes in high school. Depending on how much they would increase.

#24 - Change middle school to junior high concept. Not sure about this one; how does it save money? And, didn't we switch TO middle school FROM junior high a few years back because that was going to save money?

#30 - Increase parking fees. Good way to raise revenue.

#31 - Charge for sending transcripts. I would only support this option if a certain number were sent for each student at no charge. If there was a charge beyond the free allotment, that could be acceptable.

Ones that are absolutely unacceptable to me are #1, 2, 5, 9, 17, 21, 25, 26.

Regardless of whatever combination of listed items have to be done to close the gap, we do have to start with labor costs. And, we can't ignore $30M over 5 years - outsourcing has to be part of this solution.

Newbie said...

That's a good list jls. First cut back on labor costs by outsourcing, then if necessary start working on the less offensive areas of the cut list but under no circumstances do we cut programs. If outsourcing and a few extra fees gets us down to a zero budget that's fine. But if the board does these things and there is still a small deficit then tax payers should be willing to pay for a small tax increase. That's what erring on the side of the kids should be all about.

acs said...

Agree. Outsourcing is a requirement now with such a huge gap between private and district in house cost. Hard to see how NESPA can get a contract now without a lot of severe pain they could have avoided up front.
I think the board will methodically go through all the right legal motions to avoid challenges and then bring outsourcing to a vote and it will pass. Hard to see any support on the board for making deep cuts to education after laying off 65 last year.
I think outsourcing will give the board and taxpayers a few years of breathing room with potentially a balanced busget and maybe get the NFT to finally understand they will need to take the boards offer or work without a contract indefinately with no step increases.

Jake said...

Right on ACS. The deal is already done and the board is just manuevering to avoid lawsuits. I think even nespa knows that. How can the board turn its back on all these savings? If any board member, ANY, dares to vote against outsourcing, the public outcry would force them to resign.
The nft probably thinks the board will use outsourcing savings to negotiate with them but that isn't happening. This board has guts and ain't backing down.
Just imagine, a budget at or near zero and no education programs cut. That's the way it oughta be!

C said...

Lets start over! On July 1, 2010 NESPA is gone and there is no need to cut programs for the children. Now, let the NFT go rehire on your terms. If they don't want to teach at a lower salary then hire some of the young adults with education degrees and certifications that are working in banks and waiting tables because they cannot break the union strangle hold on school boards. Many of our young adults have gone out of county and state for teaching positions, we are losing some brillant minds that could enrich our school district. With the reduced salary and pension cost for teachers we may be able to increase educational programs for students in the district (elememtary computer classes etc.). There are private school teachers out of work also (because of school closings and cut backs) that would jump at the opportunity to teach for this district. Now is the time for the board to take back the district from the NFT for the sake of the children.

Neo Con said...

ACS, I tend to side with you on the cost savings of outsourcing, but from reading the latest posts I find myself puzzled by the fact that almost no one (aside from the occasional post from C) is considering outsourcing the teachers. More and more I read that school districts across the country are getting rid of their salary, benefit, and pension bloated faculty and either re hiring them at an acceptable rate or just bagging them all together and starting over. I am hopefull that this mess will all be straightened out soon because no matter how much money sacking the support staff will save I cant help but think that this budget problem should rest almost entirely on the shoulders of the teachers union that has to this date never given up any contractual concessions in the name of frugality. To me, it seems as of now, that the teachers union is the one holding all the cards because if they do nothing, they lose nothing. They dont have to come to the table and talk contract because if they do they will lose, lose benefits, lose some pension, lose some steps...but in the end who really ends up the loser? WE DO! John Q. Taxpayer.

acs said...

Neo, I believe for the first time the NFT is almost powerless. Boyd like Anderson totally misplayed her hand. She should have opened with 2% HC contribution and negotiated salary and retirement. Now she is totally helpless.
She has no cards to play and the board simply needs to hold out and wait one more year for the community to get hit with the PSERS tax and they will start literally hating teachers. At least now they still get some respectregardless of Boyd's greed and lackof concern for NSD.
Once PSERS tax increases hits, Boyd will be in the same postion Anderson finds herself in now. She will have zero support from community.
Have you ever heard anyone say don't outsource and after PSERS tax increases Teachers will be public enemy #1.
Frankly Charter schools and outsourcing teachers is something I have promoted for years. With tenure and union control of education every PS district has intitutionalized mediocrity. Unfortunately NSD may have perfected it.

KClarinet said...

"...the board simply needs to hold out and wait one more year for the community to get hit with the PSERS tax and they will start literally hating teachers. "

I trust this is more a prediction than a hope.

ACS, you may be right that the NFT is in a basically powerless position - nearly anything it does is going to further inflame the public. But keep in mind that the board, regardless of having paid no salary increases, is still dealing with increasing insurance costs, and AFAIK, the old retirement benefits. It seems to me that any settlement falling between 15-16-17% and 0% for teacher contributions to the insurance premiums would be a saving to the district over the status quo.

acs said...

KC, Sure a settlement of the contract on the board's terms would save lots of money(never happen until years from now when there is a weak board or the young teachers finally get sick of no raises after 3 years or more). However outsourcing in 2010-11 will save enough to offset the cost of teacher healthcare as I said for at least a few years. Retirement is in the budget already so that is neutral and has no additional adverse impact. However the fact that no one is getting raises, and there is no retroactivity, helps taxpayers since it will never go into the pension calculation.

FeasterVillain said...

Overlooked during last year's teachers protest at back to school nights was several board members who showed they would not be intimidated as they stood toe to toe with the picketers. These board members were outnumbered by 20 or 30 to 1 but they wouldn't flinch. That should have told the teachers and the support staff back then that this board was different, that this board would not back down.
The union hopes to exploit and intimidate the posers on the board, like the one whose legacy is to have negotiated the last horrid contract and driven out a popular superintendent while getting his campaign managers daughter a promotion. In my own area the unions are putting pressure on the board members down here and it looks like it might be working on some of them. But it won't do any good because the strong will survive. Those who stood up against the union pressure will not allow the others to back down.
Don't be scared of the horrid list. Most of those ideas will never leave the paper they are written on because this board will not put union wealth ahead of the students. The final whistle may not blow for years to come but this game is already over.

finance-101 said...

Great Guest Opinion today in the Courier, 7/12, by a resident from Pennsbury. It is titled, "Pennsbury's hallowed reputation is on the chopping block". Everyone should read it because it relates to our problem here at Neshaminy. He concludes that it takes years and years to build a reputation (strong school district). Once lost, it is hard to regain.

I see us as being in a similar situation as Pennsbury. Do we want to become Morrisville and Bristol, or do we want to remain a close second to Council Rock and Central Bucks ?

KClarinet said...

ACS,

As they relate to the pension plan, the salaries paid in Neshaminy aren't even a drop in the bucket of all the pensions being paid statewide. I hardly think they'd significantly affect pension costs. If you feel otherwise, I'd be interested to see the calculation.

Whether or not retirement incentives are already built into the budget, those costs could be reduced if a contract were agreed to that reduced or eliminated them - immediately, if a contract were signed tomorrow.

A contract settled even somewhere between the board's current terms and continued free medical insurance would likewise save money over what the board is now paying - immediately if a contract were signed tomorrow.

You're so hell-bent on beating the NFT into the ground that you seem willing to ride the escalating insurance cost indefinitely into the sunset to ensure ultimate "victory" for taxpayers and destruction of NFT.

Your antipathy for Neshaminy's incompetent, greedy teachers and your unwillingness to pay increased school taxes aside, wouldn't a contract with NFT on almost any compromise terms at this point save money over continuing the status quo?

acs said...

KC,
The board put a very reasonable FINAL offer on the table to the NFT. I oppose it as too rich but OK.
The NFT rejected out of hand and has never returned to the table still insisting on free continuing Cadillac healthcare, full retiree benefits and 6% increases (no compromise). So be it.
The Answer is no, the NFT deserves nothing more than the board's offer if we must. They are overpaid by any standard of performance in PA. Especially when compared to CR CB and PB.
KC, You must be of the let's "compromise with the poor teachers"group. I am not as there is no money left to compromise.
Public Unions can be destructive to communities and American PS education. In case you may have missed it we have huge deficits we have rung up over the past 2 years and this mean no money and no way to raise taxes enough to cover it with Act1.
Most do not want the NFT to get anything more above the board's last offer and really most I talk to begrudge them that in this economy. This should be a lesson to them and by the way it is happening ALL over America. Just wait til PSERS taxes hits....all bets are off then for the NFT. It will not matter for NESPA as by then they will all be in some private worker union discovering how the real world works.
I think for the time being after we outsource we will have balanced budgets with no deficit even with Teacher Healthcare and who cares if the NFT gets a contract. As I said before the NFT has no cards to play anymore ...just a strike and wow that would go over big with the community LOL!!
Taxpayers who have none of these Public Worker benefits that they used to have in the good old days, are funding everything for themselves (retirement and Healthcare)now and still must provide Public workers what we always have (free HC and Free Retirement)?
NO WAY as those days are ending but the Fat Lady hasn't sung yet. The NFT will fight to the bitter end in the name of absolute greed.

KClarinet said...

ACS, I wish you would stop trying to put me in a "group" - you keep trying to categorize me.

Here's the sum total of what I'm saying: the district is currently paying the entire insurance premium for its non-administrative employees and will continue to have to do so as long as no contract is signed. Health insurance premiums are, by all reports, increasing far more quickly than the cost of living. With no settlement, the cost escalates indefinitely out of the board's control. With any kind of settlement, the district's cost is lower.

Keep in mind, the NFT has made no public statement of a position at all since the initial positions were published, by now literally years ago. We have only Mr. Webb's word that their position is nonnegotiable, since the NFT leadership has never, AFAIK, said so publicly. Since the board's position has been declared nonnegotiable in the Courier, a very public forum, also by Mr. Webb, there has been no question of asking the NFT leadership for flexibility or reasonableness, only capitulation. Maybe, even given the opportunity to actually negotiate, the NFT would continue to be as intransigent as the board. Or maybe not. We'll never know if things continue as they are.

I'm not planning to respond again to this topic because I've said all I have to say and I'm simply repeating myself. I don't want to monopolize the discussion. So, until there's something new for me to consider, I'm out of the conversation - for at least awhile.

JS said...

To show I am not entirely about picking on our Business Manager, why is it that an elementary Principals make $123+k/year? We have 8 elementary schools. That means we are spending almost $1 million dollars for elementary principals. Given that an average class is 725 students and the elementary schools have 6 grades (K-5) that would mean there is an average of 543 students per elementary school. That's less than 1 total grade size yet they are the highest paid of any of the principals (including the High School). Now why is it that combining the three Middle/Elementary school Principals at the three connected locations would be a bad thing?


Now on to hopefully answering why it currently stands as more beneficial for the district to not have the contract settled. Currently there appear to be close to 300+ certified teaching staff who have 12 years or less of teaching. Disregarding those teachers who are new to the District this school year there are 300 teachers who have not gotten any step raises (700 teachers haven't had any year to year raise) and countless others who have moved laterally due to completed credits. That means that all those teachers will be expecting minimally a 12% jump in pay when they sign this new contract between steps and COL (even at 1%).

We've talked about the mandatory credits for teachers to keep their certification, so those teachers who were a step 4 back in '07 (the last raise) would be exptecting 16-17%+.

That means those 300+ teachers are minimally making an average of $56k per year (Master's degrees and credits earned prior to year 6 would make that average even higher). Given that even the minimum step raises would amount to a %12 percent raise, just those 300 teachers would amount to $2,016,000 in increased salary over the current paychecks (8% of that would be another $161,000 in pension contributions). This doesn't even account for the other 400 teachers who are above the last step even with getting only a 1% pay bump. (Somewhere in the $600+k range minimum, again credits and degrees would make that higher, and another $48k in pension contributions)

$3 million in salary/pension increases that would almost automatically kick in if the contract is signed I believe is less than medical premiums increase year to year. So that is where ACS comes up with the idea it's better for the District to not settle at this point.

But now the meaty stuff....

Which now begs the question (and I will reference a point the teachers I talk to always bring up), if you are saving $3 million plus in salary from the teachers alone (let alone the percentage now being paid by the administrators) where are the savings going? The Budget shows a actual increase for Regular Education group insurance between 08/09 and 09/10 as a 6% increase. The budgeted amount for 10/11 has a 36% increase with a new category "expired contract group insurance calculation".

Since the expired contract is costing us 100% of the premiums how would that amount to a 30% budgeted increase for this coming year if the NFT takes the offer? Did BCBS up the rates by 36%? Maybe Mr. O can answer that.

Actually I might have found where the saved money might have gone. In 08/09 we paid $55k in unemployment benefits for Administration. In 09/10 we paid $1.5 MILLION!!! Since we haven't fired anyone (Kadri left and took a new position) and the only other administrators that left retired, where did this extra $1.45 million dollars go? Did we buy someone out that we didn't announce in public? Total salaries are only down about $100k so it's not like we laid off a ton of people.

I really wonder if someone will have to request an official legal audit of Neshaminy's books to find out where all this money seems to be going. $1.5 million is a lot of expenditures to pop up out of no where.

LetsBePractical said...

I am concerned about the idea of cutting the Co-op Program. If this program gets cut, those students will remain in the building for the full day as opposed the the 1/2 day school and 1/2 work schedule they are currently on. That means that these students would need to be added to class lists for the remainder of the day. I understand that once the numbers for these classes (especially the special education classes by LAW) hits the max, then new classes will need to be opened up. Wouldn't this potentially require hiring more teachers? In addition, lets not forget that these co-op students are earning credits while they are out at work and not in the building, and that the Co-op Program actually probably INCREASES likelihood that many of these students WILL graduate. IF we force these students back in to classes for the full day, I suspect that many will fail and/or drop out. How is this going to save money in the long run, let alone keep our graduation rate high and drop-out rate low? Maybe a compromise could be that the Board consider whether we really need a Co-op Teacher AND a FT Job Coach at the High School. I am not sure what the responsibiity of the Job Coach is, but I believe that this is NOT a certified staff position, therefore, not responsible for ensuring credits for the students. In addition, I am told that the position is NOT a part of the NFT. I know it may not amount to a huge savings, but we are speaking about cutting positions and programs that I believe are necessary for our children to develop and be successful students and citizens in this day and age (i.e., Guidance Counselors, technology/librarians, and the Co-op Program in it's entirety). I suspect that cutting the Co-op program in it's entirety this year, will have and more detrimental fiscal impact on the community in years to come.