June 18 may seem like a long way off. But between now and then, a lot of important decisions will be made that will impact the next school year in Rochester.
Rochester Community Schools is facing yet another round of cuts. After restructuring that adds up to $31 million since 2001, the district is facing a shortfall of $10.8 million for the next school year. At a Jan. 27 workshop, the board of education instructed administration to find budget reductions in the range of $3.5-$6.1 million and take the rest from the district’s fund balance.
Already, the district has cut staff, everything from clerks to paraprofessionals to administrators. It has increased fees to students and others who use district services. It has deferred maintenance, cut supplies, outsourced food service and security, and won concessions from its remaining staff.
With contracts expiring this year, transportation and custodial employees are once again facing the ax. On Feb. 29, the district is scheduled to open bids solicited in an effort to bring down those costs. More outsourcing or employee concessions could occur. (A spokesman for AFSCME, which represents these employees, could not be reached for comment.)
Daniel Romzek, the district’s new Assistant Superintendent for Business, said budget numbers are still pretty fluid at this time, as the state legislature hasn’t yet acted on Governor Rick Snyder’s budget proposal.
“Either we find new revenue, which we are very limited in doing, or we reduce expenditures,” Romzek told the board of education Monday. “And that is what you will see us doing over the next few months. … If the board does nothing, next year we could anticipate an ending fund balance of around 8.8 percent.”
The district is planning to go to a full-day kindergarten schedule in the fall, a change that will add an estimated $3 million to the expense side. The district’s share of retirement expenses is also expected to rise again, this time by 3 percent. On the plus side, the district expects to save $3 million on health care, now that employees are required to pay 20 percent of their health-insurance premium.
Since 2009, the district has stayed solvent through a combination of cuts, one-time funds such as the federal stimulus, and the use of the fund balance (savings). Even so, “We’ll spend about a third of our fund equity this budget year,” Romzek said. “We cut $3 million in expenditures but we still anticipate we will be spending down the fund equity by about $9.3M.”
If the district were to preserve its savings and eliminate next year’s shortfall entirely through cuts, “That would be very significant budget reductions,” Romzek said. “It would affect many services offered. … We spent quite a bit of time talking about these options, and the board of ed. supported a combination approach.”
Several residents who attended Monday’s meeting questioned some of the assumptions being used at this time.
“The numbers seem to have changed a little bit” since the board workshop, said Jim Cassaza. He questioned the assumption that the district will qualify for $1.5 million in incentives proposed by Snyder for an as-yet undefined category called “student growth.”
“I don’t know how comfortable the board really is in including the $1.5M for student growth,” Cassaza said, asking for more discussion.
Juliann DiTommaso asked why expenses are projected to show what she called “tremendous growth.” Romzek replied that the district’s mandatory retirement contribution has doubled, while state funding will be back at the 2006 level next year as some one-time funding disappears.
“This is just the first of many discussions we’re going to have on the budget,” said board President Jennifer Berwick. “We will be talking about this in much more depth as the weeks go on.”
Public input
The public will have a couple of opportunities to weigh in on the budget in the coming months. On March 26, the administration will present the board with a non-prioritized list of potential cuts. The list will show simply “what kind of budget reductions would it take to get to that $6.1M reduction,” Romzek said. On April 16, the board is expected to make a decision on the custodial and transportation bids.
On April 30, the board will discuss and take public comment on potential budget cuts. On May 7, the administration is planning to present its preliminary recommendation. Final recommendation is scheduled for May 21, with a public hearing on June 18, followed by adoption of the budget.
For detailed information on the district’s financials, including past budgets, reductions, audits and more, visit the business services page at www.rochester.k12.mi.us.
