Budget Reduction 2011 - 2012
In the past several years, the District has experienced a shortfall of revenue compared with its operating needs. This trend has been exacerbated by the downturn in the economy. Specifically, our revenues have been adversely affected due to delayed state payments, tax objections, delays in property tax collections, unfunded state mandates, and low interest rates.
Over the past several years, the District has taken measured steps to close the gap between our revenue and expenditures. Support and operational positions have been eliminated, fees have been increased, salaries have been frozen, material budget reductions have been implemented, and more. [For a summary of the three previous Budget Deficit Reductions (BDR 2004-05, 2006-07, and 2007-08), see the attached amendment.) However, the current situation is much more challenging to address. Since a majority of any school district’s expenses are labor related, the only way that the District can make significant inroads in closing the gap is to reduce staff members. (Last year 10 non-certified positions were eliminated, all instructional assistants, deeply affecting the students and teachers in the classroom).
Our projections tell us that by June 2014, the District’s fund balances will be reduced to less than the 30% Board target. Given the economic conditions in our state, it is even possible that further unfunded mandates may come with pension reform.
In our recent Satisfaction Survey, we received feedback from the school and wider community on our finances. In short, there is support for increasing activity fees but not necessarily class size. Moreover, seeking a referendum is not a direction that is preferred by our community. In this time of economic pressure, this response is very understandable.
As mentioned, the District’s fund balances will be reduced to critical levels in the next few years if further and deeper cost-containment measures are not taken. November 2010 budget projections indicate the District dropping to a zero operating balance during the 2015-2016 school year. We need to take proactive steps to close the gap between our revenues and expenditures. While parents were supportive of increasing fees for extra activities and we will implement those increases (To view 2011-2012 Student Fees, go to www.d57.org/documents/student-fees/student-fees-2011-12-school-year), it is important to know that this step will not address the fundamental financial deficit. We will need to reduce our staff which means that we will need to increase class size and eliminate and/or restructure highly valued programs beginning in the 2011 – 2012 school year. The Board of Education has directed the Administration to develop a staffing plan and cost containment measures that will close the financial gap.
Finally, I would like to mention that the last successful referendum to increase the tax rate to the Education Fund was March 1988 in the amount of 78 cents. Recent referenda attempts failed. Had they been successful they would have put the District in a solvent financial position. While there may have been a number of reasons for this result, it seems clear the District was unable to make a compelling argument to the community about the need for increased financial support. As we move into the next school year, it is our hope that we can do a more effective job of telling the story of our need. Our desire is to have District 57 continue to be a high performing, quality district. We will need our community’s support to continue to maintain that goal.
To that end, the following budget reduction measures will be incorporated into the development of District 57’s 2011-2012 Budget. ESTIMATED savings amounts appear in red. (The budget is approved annually by the Board of Education at its second meeting in September):
Non-personnel Items
- Reduce non-personnel costs 2-3% (i.e. purchased services, supplies, equipment)
- Defer Master Facilities Plan work for summer 2011 ($700,000 assuming no emergency work is necessary)
- Eliminate transportation option for Circle of Friends typical peers and ECDEC students ($50,000-$100,000)
- Suspend and re-evaluate Space Challenger field trip ($4000)
- Reduce curriculum field trips and charge fee to make cost neutral ($10,000)
- Suspend and re-evaluate SummerQuest. Investigate maintaining summer band camp, if cost neutral
- Reduce summer temporary custodial assistance from 5 to 1 ($15,000)
- Restructure Outdoor Ed
- Eliminate Activity Buses ($24,000)
Personnel Cost Reductions
- Administrator salary freeze 2010-11 and 2011-2012
- Certified staff reduction
- Restructure LRC delivery model ($78,000)
- Restructure Gifted Program at elementary for 2011-2012 ($32,000)
- Restructure 4th/5th Grade Band and Orchestra ($78,000)
- Eliminate one team at Lincoln ($411,000)
- Reduce sections in Grades K – 5 ($102,000 - $459,000) Resectioning could increase class sizes up to 30-31 students per class.
These measures could result in cost savings between $880,000 and $1,500,000. This wide range is a result of two factors: (1) How aggressively we strive to balance the budget in one year and (2) Union negotiations regarding any salary increases. Final staff reduction numbers, grade sections, and class sizes will not be determined until these two factors are concluded.
Thank you,
Dr. Elaine Aumiller
Superintendent
