School finances: Surgical knife being sharpenedNext school year the River Falls School District will have to cut about a million dollars out of a general fund budget of roughly $30 million.
By: Phil Pfuehler, River Falls Journal
Next school year the River Falls School District will have to cut about a million dollars out of a general fund budget of roughly $30 million.
Superintendent Tom Westerhaus discusses what he calls a “very serious situation” in his personal column that accompanies this story.
Part of the solution could potentially result in eliminating 15 or more school district employees for the 2012-13 school year.
“That’s why it’s serious because we don’t have a declining enrollment, but we would have to figure out how to get along with 15 fewer people,” Westerhaus said.
Class sizes may also have to increase. Block scheduling at the high school will be reviewed. Electives and some programs might end.
The painful budget reduction process is about to get underway.
Teachers will have input. In early spring public hearings will be held to gauge reaction to various budget-cutting plans.
The school board will vote on a final plan by April.
Westerhaus and board members met with three of the area state lawmakers -- Sheila Harsdorf, John Murtha and Dean Knudson -- last week Monday night in River Falls.
Westerhaus said the meeting generated a frank exchange of views and information. The lawmakers made no offer that state aid for schools would increase anytime soon.
“It was a good working session, they were definitely listening to us, but we didn’t come away with any new hope for financial assistance,” Westerhaus said.
The superintendent said Knudson told those at the meeting that until Wisconsin gets control of Medicaid costs; there will be “no new dollars for K-12 or post-secondary education.”
Westerhaus said Harsdorf mentioned that the Legislature is right now focused on “job creation.”
Under Gov. Scott Walker and the Republican-controlled Legislature, state per pupil spending has tightened.
At the same time, school districts like River Falls were able to slash spending on teachers who were asked to pay much more for their pensions and 12.6% of their health insurance premiums.
Westerhaus said that River Falls didn’t gain as much under this new formula as some school districts.
The reason: River Falls teachers were already paying a portion of their health-care costs.
Some school districts, however, that were still covering their teachers 100%, picked up a much greater savings when their teachers were suddenly forced by the state to pay set amounts for health insurance and retirement.
New employee contract talks later this year could result in River Falls teachers paying an even higher percentage for their benefits.
Under the new state-imposed collective bargaining law, teachers can only negotiate for their wages, and even that is tied to the consumer price index.
Westerhaus said that no matter the political reality, the school district “needs to balance its budget and live with what we’re given.”
Westerhaus said budget belt-tightening has already begun this school year. Any savings now will mean less to cut later.
Luckily, the mild winter so far has meant utility (fuel) costs are down from what was budgeted. If the trend continues, that’s one savings that could carry over.
Westerhaus said the school board could also conceivably tap into its “fund balance,” or money it keeps in reserve.
The district’s aim is to keep a fund balance of at least 25% of its operating budget. This allows the district to cover its bills and meet payroll obligations without short-term borrowing that would result in paying interest.
A solid fund balance also keeps the school district’s credit rating high. This allows the district to pay a lower interest rate when it borrows for big projects -- like building a new high school, or repairs and renovations that were approved in last November’s levy referendum.
Westerhaus urged school district residents to follow the budget-cutting process and get involved.
“No cuts have been determined yet,” he said.