Berkley schools passes budget without layoffs, program cuts
June 20, 2012
BERKLEY — School officials are happy that they were able to balance the 2012-13 budget without making any major sacrifices, but concerns still linger about the stability of state revenue sharing.
The $44.9 million general operating budget was approved unanimously by the Berkley School District Board of Education at its June 11 meeting. While the budget required the elimination of a projected $2.3 million shortfall, it features no employee layoffs or cuts to programs.
Larry Gallagher, deputy superintendent of finance, facilities and operations, concluded his presentation to the board with an optimistic message: “This budget provides for the high-quality, fundamental, solid programming that supports the outstanding teaching and learning for which Berkley Schools is known, despite ongoing difficult and challenging economic times,” he wrote.
In a subsequent email interview, Gallagher noted that while the 2012-13 budget was no walk in the park, it was not nearly as difficult as the one that the board passed last year, when all Michigan school districts were facing cuts of $470 per pupil from the state.
“Overall, we feel pretty good about the budget,” he said. “It’s balanced, and all of our programs are intact. I think the budget is conservative, and we will meet the numbers that we need to balance (it).”
Although some public school districts may receive a $120 per-student funding increase this year, Gallagher anticipated that Berkley schools’ funding will remain flat at $7,727 per student. Gov. Rick Snyder may also soon be implementing an incentive-based program requiring school districts to meet a number of “best practices” in order to earn additional state funding, similar to the Economic Vitality Incentive Program that he put in place last year for Michigan municipalities.
School Board President Paul Ellison pointed out that the unpredictability of state revenue sharing continues to be the greatest challenge for Berkley Schools and other districts.
“Maintaining stable funding has been school districts’ biggest concern for at least 20 years,” he said. “We’ve been very fortunate that our administrators have done a great job of coming up with additional revenue for our district, and so we were able to erase the $2.3 million deficit that we were facing. There were no cuts (from the state) this year, but it could be very difficult to plan for next year since we don’t know exactly what the governor’s new requirements will be.”
The district will be adding 8.5 full-time equivalents to its teaching staff in 2012-13, although seven current teacher retirements are also expected, and some paraeducators’ hours will be reduced. Meanwhile, its special education program will be expanding, with 3.2 full-time teaching equivalents being added; its kindergarten program is moving almost exclusively to an all-day option; and its elementary school media specialists will transition from full time to part time. In addition, Berkley High School’s new Chinese student exchange program will be launched this year, and its BHS Scholars accelerated learning program will widen its reach to include students from outside the district.
“This is fairly significant overall program growth with flat revenues coming in,” Gallagher said.
For Ellison, another positive development this year was the successful negotiations between the school administration and the teaching staff. “Our teachers’ union overwhelmingly approved their new contract, and that doesn’t happen unless you have tremendous respect between both sides,” he said. “They obviously understand the financial situation that the district is facing. We really want to thank them for the sacrifices that they’ve made.”
Berkley Schools was also able to save a great deal of money by switching to a “hard cap” health care policy for all new employee contracts. According to communications supervisor Jessica Stilger, this change will result in savings of about $1.4 million for the district.
The district opted to use a small portion of its fund balance this year, which now stands at a little over $1.8 million, or about 4.1 percent of its 2012-13 budget expenditures. However, Stilger noted that school officials strive to keep that percentage between 4 and 7 percent, so the district remains within its target range.
Looking forward, Gallagher believes that the most pressing issues for Berkley schools will be maximizing its revenue in an era of declining state funding and navigating through looming pension reform and required contributions to the Michigan Public School Employees Retirement System. In addition, he said, the district is focused on wrapping up all of its outstanding collective bargaining agreements and advocating in Lansing and Washington, D.C., in order to protect the best interests of public education.
Ellison is assured that in the face of all these challenges, the district has the right leadership in place to guide it through the changing educational landscape. Although Superintendent Michael Simeck is leaving at the end of the month to take a new superintendent job in Illinois, Ellison anticipates a smooth transition when current Director of Schools and Human Resources Dennis McDavid takes the reins. The school board unanimously appointed McDavid as Berkley’s next superintendent back in March.
“We have such a talented group of administrators in our district,” Ellison said, “and that’s why we chose to hire from within instead of looking for an outside candidate. We’re very confident moving forward with this team in place. We will continue to take a conservative approach to budgeting, and hopefully, we can get some help from the state, too.”
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