Bentley Community Schools

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Bentley Community Schools

• Re-Imagining Our Future
• February 26, 2006

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Global Economic Meltdown

• The US - led global recession
• Started as a single industry recession
• Automotive industry
• 414,000 jobs lost in Michigan from 2000 2007
• An additional 173,000 payroll jobs lost in 2008
• Loss of 587,000 Michigan jobs

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Major Issues Facing Schools

• School Aid Fund Shortfall
• Funding Inequity
• Declining Enrollment
• Rising Healthcare Costs

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Future Issues

• Rising Retirement Costs
• Infrastructure Costs
• Decreasing Local Property Values

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School Aid Fund Shortfall

• 2008-09 Fiscal Year
• 32.8 million shortfall
• 2009-10 Fiscal Year
• 234.3 million shortfall
• Proposed per pupil cut of 59
• Funding restored with stimulus money

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Funding Inequity

• Minimum Per Pupil Foundation Allowance - 7316
• Maximum Per Pupil Foundation Allowance - 12,443

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Declining Enrollment

• 80 of all traditional districts face declining
  enrollment
• The States K-12 student population has decreased
  by more than 90,000 students in the last 5 years.
• Its estimated that we will lose 29,500 more
  students in 2009-10

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Rising Healthcare Costs

• In the last 6 years, Bentleys insurance costs
  per employee has increased by 66

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Rising Retirement Costs

• Retirement costs are paid by each school
  district. The current retirement cost is
  approximately 1000 per student.
• The rate for 2008-09 is 16.5
• The rate for 2009-10 is 16.9

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Bentleys Financial Outlook

• Shrinking Fund Equity
• Declining enrollment
• State aid does not keep pace with inflation
• Rising health care costs
• Rising retirement costs
• No ability to increase local tax revenue for
  operating expenses

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Bentleys Fund Balance
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Declining Enrollment
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Foundation Allowance

• Over the last 7 years, the per pupil foundation
  allowance has increased by an average of 1.3
  annually.
• Inflation has been much higher than that,
  especially in the area of health care.

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Rising Retirement Costs

• Our retirement costs continue to rise, in 1998
  the rate was 11.1 of wages, for 2009 it is
  16.5.
• Based on our current payroll costs, this is an
  increase of 200,000.
• An increase of 1 in the retirement rate is
  approximately 40,000 for Bentley

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Proposal A 1994

• With the passage of Proposal A, School districts
  lost the ability to ask voters to approve mills
  for operating the school.
• Our funding is determined by the legislature in
  Lansing

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Current Budget 2008-09

• Our initial budget was revenue neutral
• Student enrollment dropped by 42 students this
  fall
• Represents a loss of revenue of approximately
  320,000
• Our projected final budget, revenues under
  expenditures by 250,000

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2009-10 Projected Budget

• Budget based on the following assumptions
• 5 loss of students
• 8 increase in healthcare costs
• 0.5 increase in retirement costs
• Meeting contract obligations

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2009-10 Projected Budget

• The result a budget with revenues under
  expenditures by approximately 600,000
• A 600,000 shortfall

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Bottom Line for 2008-09

• Our current fund balance is 561,650
• Our current budget shortfall is 250,000
• Our projected end of year fund balance is 311,650

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Bottom Line for 2009-10

• Starting fund balance for 2009-10 is projected to
  be 311,650
• Projected budget shortfall of 600,000
• Result A negative fund balance of 288,350
• What are our options?

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Our Goal

• To balance the budget without cutting programs
  and services that our educational community
  values.

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Previous Reductions

• Deans of Students
• NCA Chairs
• Media Specialist
• Technology Technician
• Transportation Supervisor
• Maintenance Personnel
• Custodians
• Business Manager

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Previous Reductions

• Payroll Clerk
• Para-Professionals
• Teachers
• Bus Mechanic
• Bus Drivers
• Food Service Workers
• Concessions in Healthcare

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Other Cost Saving Measures

• Overtime and Summertime Work
• Shared Services
• Bus Mechanic
• Technology Support
• Skills Center Transportation
• Business Services
• Human Resources
• Special Services Director and Secretary

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What Else Can We Cut?

• To maintain the same configuration of our
  facilities, we will be forced to cut programs and
  services to balance the budget.
• However, our buildings are not running at full
  capacity, due to declining enrollment.

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Changing Our Configuration

• Because of declining enrollment, it is possible
  to create a K 6, 7 12 educational system.
• Consolidating resources into two buildings will
  provide opportunities for greater efficiencies.
• Estimated reduction in staffing levels between 9
  and 11 positions

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Changing Our Configuration

• Estimated savings from personnel costs 500,000
  - 600,000

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Benefits For Reconfiguring

• The major driving force is cost savings. We need
  to balance the budget.

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Additional Benefits

• Increased instructional time in a self-contained
  classroom
• Curriculum alignment K through 6 and 7 through 12
  aligns with elementary and secondary
  certification
• 5th and 6th grade students will not be on the bus
  with high school students or in the same building

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Additional Benefits

• 7th and 8th grade students will have greater
  access to after school clubs and activities where
  appropriate
• 5th and 9th grade transitional challenges are
  minimized
• 7th and 8th grade students would have access to
  speakers and assemblies yet retain their identity
  as middle school students

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Additional Benefits

• 5th and 6th grade students would help facilitate
  peer mediation at the elementary
• Greater opportunities for peer mediation at the
  7th and 8th grade levels

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Disadvantages

• Paradigm shift
• 7th grade students in same building as 12th grade
  students
• Will 7th and 8th grade students have equitable
  access to educational programs?
• Will 7th and 8th grade students have leadership
  opportunities and retain their social identity?

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What If We Dont Do This?