Economics Driving TESD’s Budget Woes . . . EIT to Be Explored

Ray Clarke attended the TESD Budget Workshop last night and provides the following commentary.  I am fascinated that the school district is bringing EIT out of hiding.   There is much misunderstanding about Earned Income Tax – we need an open and thorough airing of EIT.  I would suggest that the TESD and township partner for the discussion, have an outside expert give a presentation (like Easttown Twp did for its residents).  The presentation should be taped and then shown repeatedly on both the school district and township cable networks.  Some people hear ‘tax’ in the Earned Income and then simply shut-down. 

Whether it is the township or the school district we are talking about — we are currently facing tremendous economic hardship and all revenue sources must be explored.  Personally, I don’t want to pay more taxes and my personal household will suffer with EIT (my husband works for Unisys) however, . . .  there is also a reality to the situation.  I applaud the School Board for recognizing the need to explore Earned Income Tax and would hope that the Tredyffrin’s supervisors would be likewise motivatedit’s called exploring options.  Both the township and the school district have been faced with major deficits in their budgets that have required cuts in personnel, services, programming in an attempt to close the gap.  But to what end can we continue to make these cuts?  At what point do we weigh the quality of life that all enjoy in this community vs. increase in taxes?  I do not see how continuing to say, no new taxes  is a long-term solution to the problem.  Comments?

A quick report from the Budget workshop. Only 25 or so residents tonight, probably reflecting that there was little discussion of program changes. The occasion was used mostly to lay out a framework, stake out some board member positions, and set up the important April 12 Finance Committee meeting where the next level of expense reductions will be discussed.

However there were some really significant outcomes, worthy of full attention.

The basic parameters being positioned to balance the budget are:
– Implement the $4 million of expense reductions already discussed
– Tax to the full 2.9% cap
– Use $2 million of fund balance
– Find at least $0.7 million of 2010/11 reductions from $1.5 million of mostly non-educational strategies
Round numbers, subject to tweaking up or down.

The principal dissent came from Dr Brake, who is not thrilled with the proposed changes to the Middle School program. He seems to be the only one on the other side of this.

Dan Waters and Kevin Mahoney lost few opportunities to highlight the fact that these 2010/11 actions leave the structural problem untouched (shades of Tredyffrin’s “structural deficit”!). And they are right: 50% of the $4 million is one year only, and of course the fund balance use can’t continue for ever. The deficit for 2011/12 after the above programs would still be $7.5 million (8.2 – 0.7).

So, the administration is going to do the following:
– Deepen the study of the $2.6 million of class size, CHS period changes, etc. that – practically – can not be implemented until 2011/12. (Strategies 47-56, approximately.) If all were implemented, the deficit would be down to $4.9 million.
– Study the implementation of an income tax. Taxing to a likely 2% Act 1 property tax cap next year would still leave the district $3 million short, so this – to me – seems inescapable.

Some EIT information that’s new to me, and definitely has a major impact on the revenues for TESD: Kevin Mahoney stated that there is the potential to reclaim not only taxes paid to neighboring municipalities, but also to Philadelphia (which would apparently get reimbursed from gaming revenues).

Kevin Grewell has posted a lot of helpful EIT information here. Important features confirmed tonight appear to be that this would be implemented under Act 511, which is coordinated with the Townships. Resident tax is split between School District and the townships, non-resident money is collected by the Township (which turns out to be looking at fire department funding).

Debbie Bookstaber (from the last TSC) asked that the study include a comparison of an EIT and a PIT.

The Board took pains to emphasize that program changes must be fully vetted, particularly in the Education Committee, and subject to public input. Back to that April 12th meeting. Also, decisions will need to be made soon on the health insurance funding and bond issuance as part of the $4 million 2010/11 programs – the former in particular being highly susceptible to assumptions. I’d like to be convinced that all aspects of utilization risk have been thought through

Further School Budget Discussion . . . How will the District fund the gap?

Tonight is an important TESD Budget Workshop — 7:30 PM, auditorium at Conestoga High School.  Yesterday, I posted the agenda and materials for review.  This is our school district and our taxpayer dollars . . . how do you want your dollars spent and how do we fund the district deficit?

There have been many budget-related comments today on Community Matters — several of which were focused on EIT.  For further discussion, below is a commentary received from Ray Clarke.  In the past, Ray has offered his opinion on EIT but has updated his remarks based on TESD’s  current 2010-11 budget information.  Here are Ray’s comments — let’s use this as a starting point for discussion:

I’d like to get away from history (except as a guide to the future) and ponder what needs to be done to secure our kids’ education going forward. I think much of the evidence supports John’s advocacy of an EIT. I’ve posted it here before but here goes again, starting with updated budget numbers:

1. After one round of proposed program changes that have been vehemently opposed by many in the community, plus a 2.9% property tax increase, the school district will still be in the hole by $3 million in 2010/11, $8 million in 2011/12. (Note that it is relatively easy to squeeze expenses for just one year…..). No official word from Tredyffrin yet, but the township will need to fund contracted compensation increases next year, too.

2. A 1% EIT would raise $9 million for both Tredyffrin township and school district, of which $2.7 million is already paid by residents and $2 million would be paid by non-residents. (Easttown would also have to implement the tax.)

3. Perhaps a 2010 Tax Study Commission would ask a question like: “Would you prefer that property taxes increase 15% for all, or that the township residents not now paying a 1% EIT do so and the township gets a 1 for 1 match, worth $4.7 million a year now and increasing with inflation?” Might there be a different answer than to 2007’s question, which referenced only shifting taxes from property to income?

4. There will be in 2011 a county-wide mechanism to collect an EIT at low cost for all the other townships with this tax.

5. An EIT diversifies the tax base among all income earners and wealth holders.

6. The TSC stated that: “Had we been presented with compelling funding needs by the school board that could not be satisfied by the present system we may well have endorsed a change in the manner in which our schools are funded.”

So, given that …

 – There is no willingness by the TEEA to consider deferring accelerating teacher salary increases (6.9% in 2009/10 over 2008/9, and more contracted each year until 2011/12) and sharing health benefit cost increases

 – We need to fund $4 million a year in replacement capital and the capital fund is running dry

– There is no willingness to unlock capital tied up in unproductive properties (note: enrollment is projected to decline in the short and medium term)

 – $2 million of the $4 million proposed expense savings have only a one time impact

 …it seems to me that the need is indeed compelling. Whatever views one might have of past School Boards, it seems to me that the current one has to operate in a very different economic environment and that their actions should reflect that.

TESD Facilities Committee Update

To update . . . I attended the Facilities Committee meeting on Friday morning.  The meeting started at 7:30 AM and lasted until 11 AM!  Dr. Pete Motel is the chairman of the Facilities Committee; school board members Karen Cruickshank and Anne Crowley serve on the committee and attended.  Also in attendance for the meeting was Superintendent Dr. Waters, Business Manager  Art McDonnell, Controller Jeff Curtis, Construction Manager Bob Plyler, and Architect Tom Daley.  School board president Betsy Fadem was in attendance for some of the meeting.  Ray Clarke, Julia Hanson and 2 other residents also attended the meeting.  The agenda included complete updates on all current and planned district construction projects.

I had never attended a Facilities Committee meeting so I was not sure what to expect . . . Pete Motel could not have been more welcoming to me, and much to my surprise, seemed to appreciate my many questions.  There was not a question that seemed to be off-limits; they could not have been kinder or more patient in their responses.  There will be minutes from the Facilities Committee and I will post them when they become available.  Here are some of the meeting highlights. Ray, feel free to add your comments from the meeting.

I asked about the use of Teamer Field, whether it was available to rent.  Teamer Field is not available and the reason is that there is an agreement with local residents to be mindful of the community with lights, noise, etc.  Aside from specific district school usage, they are respectful of the community and the immediate neighbors by not allowing non-district usage.

The 4 houses on Lancaster Avenue will be demolished in June, after school gets out.  The demolition is being coordinated in conjunction with the township sidewalk project.  It is the intention that the work will be Monday-Friday (during daytime hours) and all neighbors are to be notified of the demolition schedule.  Originally slated for additional parking, this land will be seeded and the parking lot project has now moved to the 2011/12 budget.  When pressed, Dr. Motel does not think that the parking lot will ever be constructed, period.  It does not appear that there continues to be a parking need. This will be savings of $1million+ in the 2011/12 budget.   There was a question about whether the Old Lancaster property could be sold — it’s not so much whether or not it could be sold.  Dr. Motel was absolute that the District will hold on to the property; it will not be sold.  The ESC building (next to Easttown Library) is slated for demolition in the fall.  That building has major asbestos issues and its demolition will remove a yearly maintenance cost to the district.

I asked how the land on Old Lancaster Ave and the 1st Avenue (ESC site) would be used in the immediate future. Future usage had not been decided — I made the suggestion that perhaps the space(s) could be used as a community garden or perhaps middle or high school student garden projects.  Just thought that this could create an opportunity for a partnership between the District and the community — maybe even a ‘feed the hungry’ type of garden.  Not sure where I should take those suggestions . . . maybe there is a local nonprofit that would like to get involved.

At the end of the meeting, I thanked all those in attendance at the meeting for their indulgence with my questions.  I can not stress enough — Pete Motel and all in attendence offered complete access and transparency.  I was most impressed!

 

TESD Finance Committee Meeting . . . Notes from Ray Clarke

I was unable to attend the Finance Committee meeting as it was the monthly Board Meeting for DuPortail House, www.duportailhouse.com and as the Board Secretary it would create a problem if I did not attend.

All I can say is that I am really lucky to have my friend Ray Clarke!  Not only does Ray attend school district meetings, he stays up late so that he can provide detailed meeting notes for Community Matters. When Ray sent his notes he cautioned that the information contained a lot of  ‘numbers’ and the subject matter is complicated.   As Ray explains, two topics that received the most attention last night was the insurance and bond options.  I don’t know about you, but I have always found the subject of  bonds, a complicated and often misunderstood issue.  Maybe through dialogue on Community Matters, we can delve in to the subject matter and get a better understanding.

The majority of last night’s Finance Committee was devoted to two presentations by Board advisors: on self-funding the health insurance plan and on bond issuance options.  These were sufficiently persuasive that the Board was comfortable in agreeing to include the assumptions in a preliminary budget to form the basis of discussion at next Monday’s Budget Workshop.  This budget will also include the strategies discussed at the February meeting and the 2.9% Act 1 maximum tax increase.  The cost savings (including #12, see below) total $4 million ($2 million “one time”), the tax increase would raise $2.4 million, leaving a $2.8 million deficit to be funded from fund balance or further expense reductions.  (Note that the cost savings mentioned at the meeting was $3.7 million – maybe not including #12?).

That fully half of the savings are “one time” shows how important it is to consider a longer term perspective, and Committee Chair Mahoney has been consistent in asking for this to be done.  Those one time reductions will come back in 2011/12 and be compounded by the next round of contracted compensation increases.

Below are key features of the financial strategies, which seem to me to be quite complex and with many assumptions and consequences not fully spelled out.  If your eyes glaze over, sorry! – but take heed of the important role of the Facilities Committee – as discussed here on Community Matters and spelled out below!
 
The $300,000 health insurance savings depend on the actual claims experience being less than the premiums proposed by Blue Cross.  The district is relying on estimates provided by the consultants, who stand to get a fee if the plan goes through.  The basis for the estimates was not convincing, and depends entirely on the trajectory of per person claims costs, which increased 23% (excluding large cases now closed) for the latest available 12 months.  Since there seems to be no understanding of why claims increased so much (it’s not single/family mix, for example – just “an increase in claims of $40,000 to $60,000” – why?), how are we to gauge the future costs?  The assumed savings is entirely speculative: could be more, could be less, or negative.  Do we in fact know more about the health of our insured population than Blue Cross?  Maybe we do.  It seems that most other school districts in the region are also considering a move to self insurance.  Smart schools or convincing consultants?

The bond strategies discussed were also interesting and perhaps with ramifications that deserve more discussion.   There is one straightforward opportunity – to refinance one bond issue at a lower rate, which would save $40,000 a year over each of 13 years, or $170,000, $100,000, $100,000 if front-loaded to the next three years.  Secondly, we were told that the market would be very receptive to a new $20 million issue, which could be issued at historically low interest rates.  Even so, those interest costs would total $700,000 a year for the next ten years (this was not emphasized).

So, why issue the bonds?  That brings us back to the Facilities Committee.  We were told that there is a three year capital budget in the Infrastructure Plan of $14 million, essentially to maintain the status quo.  There was mention of another $1.5 million a year of routine capital – bringing the three year total to $18.5 million – almost all the new bond issue.  Doubtless the Facilities Committee has discussed the Plan, but I did not find it on a quick look on the TESD web site.  Perhaps the details of the capital needs and any opportunities to offset them with capital sales could be provided in Friday’s meeting.

(Note that having bond proceeds floating around could help capitalize the risk of self-insuring the medical plan).

Budget strategy #12 lists a saving of $300,000, based apparently on not expensing certain items of capital expenditure.  I don’t understand enough to know if there are any old bond proceeds left to fund this, or if the new issue is required.  Just as interest rates to borrow are low, so interest rates on our fund balances are even lower.  And, there are accounting rules that let you capitalize interest during construction.  How could capital needs be funded without a bond issue?  All in all there seems to me to be an opportunity for a clear exposition to taxpayers of the actual P&L impact of all the maneuverings – a chance for the Administration to show its worth?

So, on to the Facilities Committee and next week’s workshop.  It’s noteworthy that current year expenses will have to be cut by $1.5 million versus budget to balance expected revenues.  I don’t know how that will roll forward into 2010/11 – hopefully the workshop materials will have a detailed line item comparison of 2009/10 actual forecast with the 2010/11 preliminary budget (and with out years, too), including all the strategies discussed so far.  Then it will be time to take a look at all those other strategies #15 – 60 – and other ideas that all stakeholders might bring to the table.

TESD Budget Process Continues at Finance Committee Meeting on Monday, March 8, 7:30 PM

The TESD 2010-11 budget process will continue with further discussion at the Finance Committee Meeting on Monday, March 8.  Due to the expected turnout, the meeting has been moved to Conestoga High School and will begin at 7:30 PM.  Here is the Agenda for tomorrow’s meeting.  The agenda includes goals for the Finance Committee.

Finance Committee Goals:

1. Review and update the 5 year plan incorporating the new known factors (i.e. new contracts, PSERS, determine level and use of fund balance) impacting the plan.  

2.  Formulate the 2009-2010 budget identifying expense cut opportunities with an eye toward protecting the education program.  

3. Continue to explore opportunities for co-op with other local districts for non-public school transportation.    

4.  Study implications and impact of converting TE school district to a charter school district.    

In attempt to make it easier for the public to understand the process, the TESD Finance Committee has put together background materials for the March 8 Finance Committee Meeting.  The document details the proposed budget strategies and includes lists of those strategies that were reviewed and recommended as well as ideas that were reviewed and rejected.  

The School Board will adopt the 2010-11 Preliminary Budget at the May 10 TESD Meeting and the final adoption of the 2010-11 Budget occurs at the June TESD Meeting.  I’d like to applaud whichever school board member(s) responsible for making these details available online for the public.  The information is well-organized, color-coded and easy to follow.  For planning purposes, the future dates of the Finance Committee are: March 8, April 12, May 3, and June 7.  There is a Budget Workshop scheduled for March 15.    

We understand that the school district is facing a looming deficit in the 2010-11 budget. There are miles to go between now and when the preliminary budget gets approval in May.  I encourage parents, teachers and residents to attend tomorrow’s Finance Committee.  This is an opportunity to voice your support and/or concern about programs that may be headed for the cutting block.  Discussion and exchange of information can be useful to the school board as they may critical decisions for the school district.  There will be discussion on the update of the 5-year plan which includes contracts.  I know that Dr. Waters, the district superintendent, recently renewed his current contract for 5 additional years (at his current salary).  When do the district teacher contracts expire?

Views from the High School, Part I: Conestoga Students Support Their Teachers During TESD Budget Discussion

Members of Conestoga High School editorial staff weighed in on the District’s 2010-11 budget deficit in a recent issue of The Spoke. There were a couple of editorials that I found of particular interest and will post them separately.  This Op/Ed piece indicates student support for their teachers; attributing their educational successes to the faculty.  Based on past TESD budget and teacher union commentary on this site, views from our high school students present another interesting angle.  Do you think that the views of these specific students are representative of the student body?  Do you think that the teachers influence the students; in hopes that the students will help influence their parents (the taxpayers)?  Comments, anyone?

With early dismissal of school today, maybe local teachers and students can offer their opinions.  I will provide Views from the High School, Part II in a separate post.

Printed originally on p. 7 of The Spoke’s Feb. 23, 2010 edition.

Unsigned editorials represent the views of The Spoke editorial board, and not necessarily those of the administration, student body, community or advertisers.

      Defining our education

The recent economic downturn is affecting all corners of the country, causing numerous financial problems and leading to the loss of millions of dollars and jobs, both at the national and the local level.

As evidenced by the Tredyffrin/Easttown School District’s budget proposal for next year, the school board is also experiencing economic pressures as it tries to overcome a $9.25 million deficit without sacrificing the quality of the district’s educational program.

Nevertheless, to the consternation of many students and parents, the school board is making an age-old mistake. When tackling budget issues, all businesses naturally target areas with large expenditures. For schools, this leads to the reduction of some very important individuals: the teachers.

In a draft of budget reduction proposals discussed on Feb. 8, the school board’s finance committee acknowledged that “change is particularly challenging in schools where success has become the norm.” While this may be true, the board must also recognize that any success of the students is directly attributable to the high caliber teaching staff we have in the district today.

Still, several proposals in the budget draft will undoubtedly affect some of the most commendable employees in the field. Part of the proposal states that 19 teachers, including those who plan to retire or resign, will no longer be part of the school district next year. An increase in the number of instructional periods for Conestoga teachers is also recommended in the draft.

If this latter suggestion becomes a mandate, high school teachers will have to bear the brunt of extra pressure. An integral part of the school community, teachers serve as accomplished role models for students both inside and outside the classroom. Always available during school, teachers nurture individual student growth and help create learned citizens of the world—all this in a day’s work.

In fairness to the board, we in T/E are facing trying times, and difficult decisions must be made. However, teachers are invaluable resources that cannot be removed simply to alleviate economic woes. They are the most important and influential members of the school community and sacrificing them—though it may offer temporary economic relief—will only have a detrimental effect on the overall growth of students.

The suggestions made in the budget draft are not set in stone, though, and any ideas presented in the proposal can be changed. We, the Conestoga student body, need to step up. If you don’t like certain aspects of the proposal, then make your voice heard. Instead of showing your displeasure through Facebook posts, go to a school board meeting and directly address those who are involved in the decision-making process. It is, after all, your education. It’s your future.

T/E School Board Meeting, 2/22/10 . . . Meeting Highlights from Malvern Resident Ray Clarke

In addition to the Board of Supervisors Meeting last night, at the same time there was a T/E School Board Meeting at Conestoga HS.  As usual, my friend Ray Clarke kindly attended the School Board meeting and took notes.  Here are the notes . . . thank you Ray!

Selected highlights from the School Board meeting, chaired last night with a light hand by Jim Bruce:

1.  The extension of Dr Waters’ contract for a further 5 years.  The last item on the Agenda, but given ample discussion.  Strong support from the Board, led by Kevin Mahoney, and from community members.  There is no salary increase for the full term, and it was emphasized that there are no “side deals” and that effort was made to ensure that this is a “clean contract”  It will be available on the district web site soon.

This support seems to me well-deserved (taking the administration’s response ot the budget deficit elimination challenge as one recent example) and it says much about the Board’s commitment to transparency (a word much used last night) and to fiscal restraint, with its benchmark for future contracts of all types.  One downside to leadership longevity (Dr Waters will have been the Superintendent for 16 years in 2015) is that you might miss the fresh ideas that an outsider can bring.  That perspective can come in part from the Board, and it’s encouraging that we continue to see probing questions from Rich Brake. 

2.  Bill DeHaven reminded us of the times he climbed the fence at Teamer Field to play football, but more significantly spoke of the Citizen Soldier project that has compiled into a book the names of all T/E residents who served in all the nation’s conflicts up to World War II.  The book, available at the CHS and township libraries, is dedicated to its prime mover and my good friend and open space visionary, the late Neil McAloon.

3.  Nothing new on the budget, except that – per the Finance Committee discussion – the strategies are being regrouped to link related items, and this list will be available on the web site likely late this week.  I had hoped we might hear about substantive discussions of the TEEA offers alluded to at the Finance Committee meeting, but it seems there is nothing to report.  Kevin Mahoney emphasized that the Board is taking a 3-5 year perspective on the finances – clearly critical when one element of the near term solution is to use the fund balance, which can only go so far.  The Board has recently met with local legislators about the PSERS problem

4.  Three items related to our district going digital:  a) On line course options will be increased for 2010/11 to 25 courses not currently offered at CHS; b) acknowledgment of the role of blogs like Community Matters as well as all community input (a long list of correspondence to the Board); and c) next year CHS will submit its part of the college application materials electronically – should be a big time-saver, quality improvement and stress-reducer!

Teacher Layoffs: Should Seniority Rule?

A Community Matters reader sent in a link to a recent Wall Street Journal article, Teacher Seniority Rules Challenged.  (The full article is below).  I wonder if the majority of educators favor or disfavor seniority-based layoff protections. I wonder how the majority of citizens feel as well. If I had to guess, I’d venture that most citizens are against teacher seniority serving as the primary determinant of job protection. I’m not sure about public school educators. What do you think?

I know that the challenging of teacher layoffs based on seniority is not a favorable teacher union approach.  But if school administration did not use seniority to make the necessary budget cuts, what credible evaluation system could be properly used? Isn’t the major issue with “merit” based decisions on either pay or layoffs and even staffing is who is deciding?  In the case of the TESD 2010-11 budget, it is understood that the District will not use teacher layoffs as a means to correct the budgetary gap . However, there will be programming cuts which will cause the furlough of teachers.  Within the programming cuts, is it a correction assumption that teacher seniority will determine which teachers stay (or go) correct?  This is an interesting topic; I’d like to hear from teachers, parents, administrators, residents.  But do read the following article, think you will find it of interest:

Teacher Seniority Rules Challenge

With Tens of  Thousands of Layoffs Looming, Government Officials and Parents Want to Change the ‘Last in, First out’ System

By Barbara Martinez 

Teacher seniority rules are meeting resistance from government officials and parents as a wave of layoffs is hitting public schools and driving newer teachers out of classrooms.

In a majority of the country’s school districts, teacher layoffs are handled on a “last in, first out” basis. Critics of seniority rules worry that many effective and talented teachers who have been hired in recent years will lose their jobs.

Unions say that seniority rules are the only objective way to carry out layoffs, and that they protect teachers from the whims and bias of managers, who might fire effective teachers they don’t like.

This year, because of cuts in state aid to New York City, the city could be facing a loss of about 8,500 teacher jobs out of a total of 80,000. The last time the nation’s largest school system laid off a teacher was 1976.If New York City is forced to lay off some of the more than 30,000 new teachers it has hired in the past five years, it is “going to be catastrophic,” said Joel Klein, chancellor of the city’s school system. “We’re going to be losing a lot of great new teachers that we hired” in recent years, the chancellor said.

Mr. Klein added that another problem with “last in, first out” was that because newer teachers earn less than veterans, more teachers will end up losing their jobs.

First-grader Victoria Bernade copies a sentence as teacher Lori Peck goes over sentence structure at Grace L. Patterson Elementary school in Vallejo, Calif., on Feb. 12.

What Mr. Klein “is really trying to say is, ‘I would like to churn the work force by keeping cheaper teachers on the payroll,’ ” said Michael Mulgrew, president of the United Federation of Teachers, the teachers union in New York. “If we can do our work in a constructive and collaborative way, we can avoid the layoffs. That’s where we should be focusing our energy.” Mr. Klein has requested a number of times that the state legislature ban the sole use of seniority in layoff decisions. California’s governor made the same request last month. While politicians in these states are unlikely to enact such bans, the movement is gaining traction elsewhere.

Last year, Arizona passed a ban, and schools Chancellor Michelle Rhee in Washington, D.C., in addition to letting go some new teachers, laid off some who would otherwise have been protected by union seniority rules. Teachers unions in Arizona and Washington sued over the moves, but they lost their court challenges.

“It is a pent-up issue that has been pushed off and pushed off, and now we have to deal with it,” said Tim Daly, president of the New Teacher Project, a nonprofit that helps recruit teachers in mostly urban school districts and opposes seniority-based layoffs.

“It’s not just that you will lose teachers that you invested a lot in,” he said, “these cuts are being made in a quality-blind way.” Mr. Daly said some school districts were forced to lay off teacher-of-the-year nominees last year.

About 60,000 school workers were laid off across the country last year, according to the Bureau of Labor Statistics, double the number laid off in 2008 and three times the level in 2007. The total number of public education jobs fell in 2009 for the first time since 1984, according to the BLS. Declining state revenues, which result from the country’s economic turmoil and high unemployment, only increase the probability of more large-scale teacher layoffs ahead, said Marguerite Roza, a professor at the University of Washington’s College of Education.

“We would expect that education jobs will be hit harder in 2010,” Ms. Roza said. “Given last year’s layoff trends, we should expect even more layoffs this year.”

Parents in some school districts are beginning to organize over the issue. In Seattle last year, parents started asking, “Why is my great teacher being laid off while this teacher, who everybody knows is not a good teacher, doesn’t get laid off?” said Venus Velazquez, a parent who said she is one of dozens attempting to remove the seniority protection from the next teacher contract. “We don’t want to go back to the ’50s or ’60s, when people were laid off because of the color of their skin or because a woman was pregnant,” said Glenn Bafia, executive director of the Seattle Education Association, a teachers union.

Mr. Bafia said poor-performing Seattle teachers need to be encouraged to leave teaching through an administrative process. “That’s the principal’s responsibility. If the principal refuses to do their job, that’s an issue,” he said. When it comes to layoffs, “seniority is the only objective criteria there is out there.”

For the unions, the pushback is in some cases coming from people who consider themselves liberal and pro-union. “I consider myself a union supporter, but I don’t support the seniority system,” said Lynnell Mickelsen of Minneapolis, who is organizing a community group to oppose the main use of seniority in layoffs. In a shrinking school system, which has resulted in the loss of 1,300 teacher jobs since 2001, “terrific teachers have been laid off, and [some of those remaining] are depressingly, relentlessly mediocre,” Ms. Mickelsen said. “People are so frustrated about this.”

Lynn Nordgren, president of the Minneapolis teachers union, said the union and the system already work together to remove ineffective teachers, pushing out between 400 and 500 teachers in the past 10 years. With poorly performing teachers already being addressed, “seniority gives us a fair way of saying how do we lay people off in a way that’s equitable,” she explained.

 Ms. Mickelsen isn’t buying it: “When it comes to key contract clauses like seniority, the needs of teachers and kids are not the same.”

West Chester Area School District Superintendent is Suggesting 19 Staff Cuts to Help Budget Deficit

Tredyffrin Easttown School District taxpayers should not feel that they are alone with challenging school budget problems.  One of the purposes of looking at other districts (such as Great Valley and now West Chester) is to see if can learn anything new or examine other ways to handle similar problems. Dan Kristie is reporting in today’s Daily Local that West Chester Area School District Superintendent Jim Scanlon announced that he is recommending that the school board cut 19 district jobs.  The cuts will be carried out by attrition – when current staff members retire, their jobs will not be replaced.  Cutting of these 19 jobs (which include 3 assistant principal jobs) will save the district $1.4 million annually.  The suggested cuts were developed by the administration and the Community Budget Task Force, a group of more than 150 stakeholders who met last year to help the district identify cuts.  Here’s one West Chester Area taxpayer’s take on the announcement:

Attrition means forced retirement or risk termination for some folks. As a former Educator that is the one field that you never thought would be impacted by economic downturns but they are quietly finding that they have stood behind their union protection for far too long almost to the point of holding the very people whose children you educate are paying to keep you there hostage.

They are no more entitled to job security than anyone else. If you can do more with less people then by all means do more with less.

To those who will lose jobs in all of this…WELCOME TO THE REAL WORLD.

Mr. Scanlon . . . I know it’s tough to tell your people tough times call for tough decisions but then again that’s a part of your job too. “

Continuing to Discuss TSED Teacher Pension Plan

Following up on my last post about the Great Valley School District, I think that I am beginning to understand their resident involvement. One of the best parts of Community Matters is that readers bring new information to the discussion.  I received a comment from ‘Berwyn Reader’ that offered interesting insight on the Great Valley School District (GVSD) residents and their ability ‘to hold the line’ on school tax increases. A few years ago, Brian O’Neill of O’Neill Properties (Worthington project) asked GVSD to be a lender on his Worthington project.  In the end, GVSD choose not to lend money to O’Neill.  However, because of residents concerns, Great Valley Stakeholders was formed about 18 months ago and has become a sort of watchdog organization for the Great Valley residents.  The purpose of the Great Valley Stakeholders is to provide information to the public and School Board to ensure fiscal responsibility, transparency and better communication between school board and taxpayers. 

Here’s hoping that Community Matters will be able to provide similar information to taxpayers and Tredyffrin Easttown School District school board members.  Many of our residents who have provided commentary to this site on the school district topic have helped us better understand our own budgetary process.

Beyond the current 2010-11 school budget discussion, I remain concerned that many of our taxpayers do not understand the PSERS (Public School Employees Retirement System) teacher pension plan and how our taxes are going to be affected as a result.  I found an interesting statement from the Commonwealth Foundation on pensions. The Commonwealth Foundation is an independent, non-profit research and educational institute that develops and advances public policies based on the nation’s founding principles of limited government, economic freedom, and personal responsibility.

Public Pensions: Beginning in 2012-13, taxpayers will see a dramatic increase in their contributions to pension plans for state and school district employees. This scenario is due in large part to misguided policy decisions-including substantial increases in pension benefits in 2001 and 2002, and deferring increased payments following fund losses-as well as the recent downturn in the stock market. Pension contributions are estimated to rise by $1,360 per homeowner/household, resulting in higher property and state taxes. Additionally, local pension plans are facing major deficits. . .

 A few weeks ago a opinion article written by Thomas Gentzel, Executive Director of the Pennsylvania School Boards Association appeared in the Philadelphia Inquirer. This commentary titled, Change Pennsylvania Pension System or Prepare for Catastrophe should be a  must-read for all taxpayers!  Here’s the link:

http://www.philly.com/inquirer/opinion/80562927.html

Comments anyone?

Should TESD Follow Downingtown School Board ‘s Lead and Urge Teacher Pension Reform?

One of our neighbors, the Downingtown School Board recently approved a resolution that calls for the state to change Pennsylvania Public School Employees Retirement System (PSERS). Driving their decision is the predicted dramatic increase in PSERS contribution from school districts. Looking ahead to the upcoming years, the teacher’s pension increase will greatly affect the school district’s budget and then the taxpayers.

According to one of the Downingtown School Board members, their PSERS contribution is going from a little over 4% to about 31% in 2012! School Board member Robert Yorcyk, who introduced the resolution to the other board members explained, “Considering that salary and benefits make up about 70 percent of the budget, the increase to 31 percent would represent about 15 percent of the budget or half of what we have left to support education.”  The Downingtown School District pays about $4 million in teacher pension contributions – that number will rise to $7 million in 2011 and by 2014-15 retirement contributions are expected to hit $36 million! The school district estimates that in just 5 years, PSERS contributions will increase nine-fold.

If I understand the PSERS plan correctly, employees and employers alike contribute and that money is then invested, . . . the pension payout is guaranteed (regardless of the market economics). The real problem is that due to the volatility of the market, school districts are being forced to pay larger pension contributions because the pension investments have not kept pace with what is guaranteed in the payouts of the pensions.

The state House of Representatives is reviewing changes in the PSER bill. The new plan would actually put a cap on the school district contributions. If the pension payout required additional funds, the bill would require the state to be responsible for the difference. The Downingtown School Board signed their recent resolution to urge the state to lessen the burden on taxpayers and the school district (understanding that the teacher benefits will remain the same).

Should the Tredyffrin Easttown School District take a similar stand? Should our school board members be encouraged to follow Downingtown’s lead?

Is the Teachers Union Aiding in the Fact vs. Fiction Component of the TESD Budget Crisis

Reading comments from teachers, school board members and taxpayers, it would seem that the teachers union, Pennsylvania State Education Association (PSEA) is adding to the element of confusion and misunderstanding.  I am struggling to figure out if the misinformation is ‘by design’ from the PSEA to confuse the teachers (and therefore confuse the taxpayers).  It is well understood that this school district like so many in this country is facing a financial crisis.  It would appear that this is the time for all of us to work together instead of against each other.  As a good first step, I would propose that the information disseminated be supported.  Unfortunately when situations reach a crisis level within an organization (whether it is the school district, local government, corporations, etc) rumor mills explode and before you know it, things are out of control. 

I certainly do not claim to be an expert on the school district or its budget by any stretch.  Our daughter was not in the public school system so I admit to not being as involved as I should have been as a taxpayer.  So I am coming at this subject at a distinct disadvantage with minimal background of experience.  However, I am beginning to think that the teachers union is coloring the picture to its membership slightly different from reality.  Or am I just reading the situation wrong?  What is your opinion of the teacher unions . . . are they helping the case for the teachers or are they a contributing factor to the current budget crisis (and unrest) in the community?  Is it unthinkable that teachers unions may re-open their teacher contracts for additional negotiations in light of the economic crisis?  Or is that simply pie in the sky thinking?

View from Someone who is Both Taxpayer and Teacher in the Tredyffrin Easttown School District

There have been 2 comments that I have been aware of from Tredyffrin Easttown School District teachers – however, there was no indication whether they were also local taxpayers.  However, I just received the following comment from an individual who is both teacher and taxpayer in our district.  I thank him (or her) for weighing in from the perspective of both teacher and taxpayer.  I thought the comment deserved front page attention.  Do you agree/disagree with the teacher/taxpayer assessment of TESD’s current economic situation?

T/E Teacher and T/E Taxpayer:

As both a teacher and taxpayer in T/E, I am very concerned with the future of the quality of our school district and hence, the values of our property. We enjoy one of the finest school districts in the country which makes the values of our homes exponentially more than neighboring districts. We must remember, we enjoy the 2nd lowest school tax rate in the state. NO district is making the agressive cuts that are proposed. Internally, we have heard from the union that 30-35 teaching jobs in addition to all of the teachers hired this year as long term subs will be gone!!! Why??? The reality is that neighbor districts DO PAY THEIR teachers more, offer retirement healthcare and bonus, have much more technology, newer facilities (schools) and personal laptops for each student and teacher!!!

UNDERSTAND PLEASE…I am not complaining as a teacher! This past contract closed the gap between T/E teacher’s pay and other districts. For example, before this contract, Upper Darby teachers were making more than me as a T/E teacher. We do pay into our benefits which is also forgotten. This whole debate and situation raises the question of why is our district in so much trouble and laying off teachers when other districts have more and are not??? The answer is that we as taxpayers have been undertaxed in comparison to the districts around us (yes, I said it and mean it) and therefore, the district relied to heavily on transfer taxes. Now no transfer tax, we are sitting hear screaming about taxes!!!

As a T/E taxpayer, I want to know why we are not tapping our reserves-the piggy bank of nearly $30 million???? The proposed budget is adding another 1million into the piggy bank, why??? Why does no one hear ask about the reserves? What about the 2.9% tax and then tap the reserve?

How Can the Residents of Great Valley School District be so Different from the Residents of Tredyffrin Easttown School District?

How many residents typically attend our school board meetings vs. how many residents attend township meetings? There is quite an imbalance in attendees; does low school board attendance equate to apathy, lack of interest, . . . ? The school district is facing a $9.3 million deficit and what undoubtedly could be the highest tax increase to the residents in years. I just do not understand.

OK, now I hear that Great Valley School District held their budget meeting tonight and unlike TESD meetings of late, there was not a free seat in the house. Great Valley is facing a $3.2 million deficit in their 2010-11 budget of $78.8 million budget. Three main options discussed – (1) 2.9% in accordance with the Act 1 index, (2) 4.7% increase if the district gets two exceptions and (3) no tax increase. If the GVSD board applies for an exception, 4.7% is the maximum for a tax increase. However, if they take that route the preliminary budget must be approved by February 16. Last year, GVSD imposed a 1.7% tax increase. The current property tax rate in the district is 18.22 mills and the owner of a house assessed at $234,900 now pays school taxes of $4,279.

It would seem to me that neighboring Great Valley and Tredyffrin Easttown school districts are of similar quality, teacher and staff qualifications, economics of taxpayers, etc. so why is there is such a disparity in the interest of between both sets taxpayers? Why don’t we have standing room only at school board budget meetings? Keene Hall at the Township Building was full to overflowing for the township budget meeting yet only a handful of residents are at the school board meetings? And our school tax increase is going to be enormous! What am I missing here?

PA Gives Final Nod to High School Exam Requirements

Pennsylvania has given its final nod to high school graduation exam requirements.  A couple of weeks ago Attorney General Tom Corbett signed off on the paperwork to create Keystone Exams.  I knew that this subject had been bantered about over the last couple of years with much back-and-forth over the merits of graduation test requirements for all high school students – didn’t know that it had received final approval.  Keystone Exams had received the support of the Senate education committee, the state Board of Education and the Department of Education and the Pennsylvania School Boards Association and was just waiting on final approval from the Attorney General.  The Keystone Exam plan will be a series of 10 end-of-course exams in a variety of subjects.  I guess the thought is to create an insurance policy for the school districts and a way to gauge all the students.  The Keystone Exams could replace the 11th grade School Assessment test, and would count for at least 1/3 of a student’s final grade in that particular subject.  With Corbett’s signature, the only remaining hurdle is getting the new regulation published in the Pennsylvania Bulletin.  The tests would be introduced for the class of 2015.  Some of the exams will be available for district review in the 2010-11 school year.

Looking at the cost of the Keystone Exams which is estimated at to be $160 million overall, spread over seven years, how does this affect our local school district budget  Pennsylvania is grappling with budgets, how does this hefty price tag effect local budgeting requirements?  Or does it?  It would seem that the Keystone Exam is a done deal, so we live with the spending of the money; I’m just wondering how we pay for it.  I have some doubts on the overall effectiveness of this exam; I would like further validation that speaks to that topic.  But regardless of my thoughts on the effectiveness of the exam, this new legislature appears to now be in place.