‘Need to be prepared’ from the Jan 25th Lapeer County Press

[William Gavette]

                     LCS braces for shared sacrifices to meet $5.6 million deficit

BY JEFF HOGAN

810-452-2640 • [e-mail]

LCS Superintendent Matt Wandrie: “There will have to be shared sacrifices among all groups (academic programs, sports, arts, etc.). We will have to re-evaluate the current program from top to bottom...” Photo by Jeff Hogan LAPEER — Members of the Lapeer Community Schools Board of Education are fed up with the state Legislature and Gov. Rick Snyder whom they claim aren’t hearing their concerns about the state of public school funding in Michigan — particularly as it relates to the cost school districts are forced to incur when they need to borrow money to get by until they receive state aid reimbursement.

At nearly every meeting of the LCS board it’s not uncommon to hear board members lamenting about the financial bind they find themselves in owing to declining birth rates, declining student body population and declining per pupil funding from the State of Michigan.

Last week in a workshop session of the LCS, the board heard from Superintendent Matt Wandrie in a review of the forthcoming 2012-2013 budget adoption process that the district will likely dip below 6,000 students in the district in the next year and may face a deficit of as much as $5.6 million.

Last year the district dipped into its fund balance by $2.2 million, leaving it with a balance of approximately $3.1 million. The district has always tried to maintain a fund balance of at least 10 percent of the overall operating budget which is approximately $49 million. “I have no intent to go into fund equity this year,” said Wandrie. “There’s going to have to be structural changes, and every single group will be included.”

“We need to be prepared for what could happen,” said Wandrie. Toward that end, he suggested the district embark on a long-term vision and plan to bring the district and its residents up to speed on the reality that the district will likely need to undergo significant changes. “There will have to be shared sacrifices among all groups (academic programs, sports, arts, etc.). We will have to re-evaluate the current program from top to bottom... We will have to stop nickeland diming because we’re not going to find the savings there alone. This will require a unique budget process,” added Wandrie who said he plans to hold townhall meetings across the district to present the budget process and share the same information the board has with the general public regarding the district’s real-time budget situation. He has been meeting with local civic organizations such as Rotary, Kiwanis and the Optimist club to introduce himself and educate the community on the budget.

Due to shrinking enrollment and escalating costs the board will likely talk about further school building reductions and consolidations, including the discussion that the district may no longer be able to sustain two high schools (East and West).

While the district will look inward and adjust to its own local economy, the school board also plans to keep up the pressure on Lansing to do more to support public education. The board is expected to take up for discussion, and possibly adopt a resolution at the next meeting on February 2 to pass a resolution drafted by school board vice president Gary Oyster.

In particular, said Oyster, one area of reform that has received no attention from the current legislature or executive branch regards the timeline for state school aid payments to local districts that forces districts like LCS to borrow money to meet their obligations for the first four months of their fiscal year which begins July 1. Typically, school districts don’t receive their first school paid payment until October 20. Oyster and the proposed resolution states that as a result of an unfunded mandate for school districts to borrow against school aid funds that was created in the 1997-1998 fiscal year caused school districts statewide to borrow more than $690 million at the beginning of the 2011-2012 school fiscal year to meet their obligations at an interest cost of more than $15 million, or roughly $10 per pupil attending public schools in Michigan.

For LCS, said Kevin Rose, assistant superintendent for business and finance, the interest payment paid for this year’s borrowing was $102,000. The resolution further asks the Legislature and governor to sign legislation that calls for school districts to be reimbursed for the cost of borrowing money. According to Oyster and the resolution, there was an estimated surplus in the state’s School Aid fund at the end of fiscal year 2011-2012 of more than $700 million.

“This is unthinkable. The state now has a surplus, partially because the Legislature diverted School Aid fund money to post-secondary schools and we have to pay interest on money we’re forced to borrow. This has to stop. This resolution is a message that this cannot go on like this,” Oyster said.

Copies of the resolution will be sent to the offices of state Rep. Kevin Daley, state Sen. Phil Pavlov and to the office of Gov. Snyder.