Lindbergh panels eye cuts while protecting student success

Budget-reduction target of $3.9 million set by district, chief financial officer says


Roughly 80 participants in Lindbergh Schools’ budget-reduction process met last week and were given their marching orders: Protecting student achievement is paramount.

Members of eight committees charged with reducing the school district’s expenditures by more than $3.9 million assembled Jan. 14 in the Anne Morrow Lindbergh Room on the high school campus.

Superintendent Jim Simpson said while millions of dollars in cuts need to be made, the district’s ability to provide an outstanding education to its students must remain intact.

“… I think of it like a bearing wall in a house. You don’t want to knock your bearing walls out because your house will fall down around you. You can knock out a wall that’s not bearing and your house still stays,” he said. “So that’s the basic premise of remodeling schools or anything else.

“Don’t touch the bearing walls. And so this committee will see that somehow we’ve got to downsize by millions of dollars and we’ve got to keep those bearing walls in place. And those bearing walls are defined as those things that make sure that our achievement and our success continue. We don’t want to do anything that hurts that and yet, that’s a delicate ballet. And I know that it seems like it doesn’t go together. Well, downsizing and quality student achievement and programs, that seems like it doesn’t go together. It doesn’t. It doesn’t. But we don’t have any choice. We’re burning through our reserves very quickly — over $5 million by June …,” Simpson said.

Chief Financial Officer Pat Lanane said a budget-reduction target of $3,914,526 has been established. That amount includes an increase in employee health insurance premiums, mandated increases in two employee retirement programs — the Public School Retirement System, or PSRS, and the Public Education Employee Retirement System, or PEERS — and a possible employee salary hike.

Of that target, Lanane said, “… What is in that number is the amount we’re over for this year. It’s the amount we know we have coming in increases in PSRS and PEERS for next year — retirement system. There’s no — we have to do that. We have the amount in there for the increased premium for health insurance next year and we have an amount in there — we haven’t committed to this — we have an amount we’re trying to see if we can get for compensation for staff. I don’t know if we’ll be able to do it or not. But we thought we needed to at least have that number in there to take a run at it, to see where we can go with it. That’s what makes up that target.”

Eight committees have been formed — elementary school, middle school, high school, central office, special programs, facilities operations, self-sustaining programs and extra duty. Each 10-member committee includes roughly four teachers, two administrators, three parents and one classified employee.

“… Each of you on each of your committees must confine your scope to your area, and the way that is actually defined in the very end is account codes,” Lanane said. “Your committee chairman will have the account codes for your committee. You can’t go to somebody else’s account code, unfortunately … You are confined to your account codes, your scope, your box, and we must stay within that.

“That’s a cardinal rule of this process. Otherwise it just becomes bedlam …”

The chairs and co-chairs of the eight committees will comprise a general task force that will provide oversight in making final recommendations to the school board. As proposed, the committees will complete their work in about one month when the general task force will convene with the goal of providing final recommendations to the school board in early March.

“… This is the board’s process. This started with the board. This will end with the board,” Lanane said. “So we’re the piece in the middle at this point. So it isn’t really the committee’s process. It’s the Board of Education’s process because they represent all the people in the school district.”

Cognizant of the financial difficulty residents and businesses are experiencing, district officials pledged in late 2008 not to seek a tax-rate increase for at least 24 months.

Though Lindbergh also faces financial challenges as a result of the current economic recession, the district’s re-serves of roughly $24.6 million are the reason why the situation is not a crisis at this point.

The district’s long-range financial plan calls for a planned spend down of those reserves with a deficit-spending cap of $3 million per year. In June, the school board adopted a 2009-2010 operating budget that projected a deficit of $3 million. But a further decline in the assessed value of commercial real estate — including successful appeals by commercial property owners to the county Board of Equalization — increased the district’s projected budget deficit for the current school year to roughly $5.1 million, according to a revised budget adopted in December.

Officials plan to further utilize district reserves to cover the increased deficit, and projections indicate those reserves will drop to roughly $19.5 million at the end of the current school year. If reserves fall below roughly $13 million, the district would have to borrow money to operate.

“… We used $3 million last year and the plan was to use $3 million, $3 million, $3 million, $3 million and hopefully by the time we get out of this downward spiral, we’re still above $13 million … because that is a bottom point, below which we start borrowing money to make it through the school year. We basically get paid one time a year,” Lanane said, noting the district receives the majority of its revenue in January after property-tax bills are paid. “… So that money that we get has to make it all the way to the next January so we don’t have to borrow money. At $13 million, we will be borrowing money. Thirteen million (dollars) sounds like a lot of money. That’ll run the district for two months …”

In considering cuts to be made, he reiterated that protecting student achievement is the top priority.

“… Student academic protection is needed, not turf protection …,” Lanane said. “That’s going to be the hardest single piece probably for everyone, administrators included. Remember we have to look at that big picture — what is going to be best for our students? And the reason we have to do this now … we have to make these balances last. We can’t come to the point where we get to the cliff and now we’ve spent everything and now we have to jump off … We don’t want to ever get there.”

To guide committee members, the Board of Education has established eight parameters for cuts.

“Most of it is just common sense,” Lanane said. “You can’t violate federal, state laws or local codes … That seems obvious, but some of you won’t know. Some of you don’t live in the world of building codes or DESE (Department of Elementary and Secondary Education) regulations and so it’s OK to give us an idea that violates it. It’s just not OK that we do it. And so we’ll be the ones able to adjudicate those and look and see if there’s some violation …”

Furthermore, the board has set cost-saving objectives and weighted values for those savings, he said.

“… The other thing the board did for us was to give us kind of their value set. What is it that we really value and not all suggestions are equal, neither in size nor in value. And some of the things we want you to really try to do are 10s,” Lanane said.” If something’s a 10, wow, we love those because we don’t get into the classroom with those. It’s the furthest piece away … We have to protect academic achievement. (That’s) the goal in all of this and you can see ‘minimize reductions in student achievement’ gets a 1. We want that to happen. So those ideas will be weighted to give them more value, and, of course, minimize increases in elementary class size. That’s the last thing we want to do. I’m not saying we won’t get to those things.

“What this process does is it makes sure as we weight items that we get them in the right order — that all the less-important things go first, even if they’re kind of minor. It may be a $150 item, but we should not be doing the $150 item if we’re doing something that’s really starting to hit at the heart of our classrooms. That has to go first — even if it’s only kind of symbolic. Believe me, symbolism in this kind of process is extremely important. So we want that to happen and we want to be able to look people in the eye and say: We did some things we hated, but we did reduce everything else ahead of that that was less important to us. So that will be very important at the end of the day.”