Thinking "outside the box": discuss Orr's proposals

In last Sunday and Monday’s Ann Arbor News, former Board of Education trustee Brad Orr made a number of what he called “outside the box” suggestions for bringing the AAPS’s budget deficit under control. His first article focused on short-term proposals: 1) Don’t open the new high school; 2) eliminate busing; 3) have elementary principals supervise two buildings; 4) freeze administration pay and eliminate Board of Education compensation. His second article proposed longer-term structural changes: 1) open contract negotiations to the public and start from scratch with a new agreement, 2) outsource custodial, food service and administrative functions, and 3) move toward “building-based budgeting.”

No matter what you think of the proposals, they should be prompting what I believe is a healthy discussion about what we can do in Ann Arbor to stop the bleeding and get our schools on a sound footing. We need to do this in a spirit of goodwill, and without pointing fingers. But we do need to do it.

Let’s talk about this!

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One Parent's Opinion

Here are my ideas about what should be done to save money in the district. I regret that I have no hard financial data to back up these proposals, but I am working on it. I welcome any thoughts or suggestions.

1. Close both the buildings that currently house Community High School and Ann Arbor Open.

2. Use the new high school building to house both the K- 8 (or 9) Open School and Community High School.

3. Change the current grade configuration, and have grades K-6 in the elementary schools, grades 7-9 in the junior high schools, and grades 10-12 in the two current high schools.

By using this plan, there would most likely be no need to redistrict. Increased enrollment opportunities at Ann Arbor Open and Community High Schools would reduce or remove the waiting lists at both schools, and decrease enrollment at the other Ann Arbor schools. Since most elementary schools are suffering from low enrollment, adding the sixth grade to these schools could make up for any additional losses. Removing the ninth grade from the current high schools would further alleviate the overcrowding there. Middle schools would still have three grades, but may still have lower enrollment due to a larger enrollment at Ann Arbor Open.

Students attending the Ann Arbor Open School could be guaranteed placement at Community High School, something that has been an issue for many families over the years.

Any additional expense to convert the new high school into two separate schools could be offset by not needing to do the planned renovations to the buildings that currently house Ann Arbor Open and Community High School.

Since Lou Young has announced his retirement, Sulura Jackson could be made principal of Pioneer as an alternative to being principal of the new high school.

Since the City of Ann Arbor owns Mack Pool and the city is often short on office space, perhaps they would lease the Mack building. The building could also be used for the Rec & Ed offices, which are currently renting their office space.

The building that currently houses Community High School could be sold or leased. This is undoubtedly a valuable piece of property with a desirable location and parking lot.

 
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One MS Teacher's thoughts

1) Don’t open the new high school
Agreed. However, I don’t think that is politically expediant right now and it would be a shame to waste a new facility. Another option would be to adjust the way we are organized as a district. We could send all 8th graders and 9th graders to that building, making the middle schools 5-7 and eliminate some elementary schools OR we could make the middle schools 6-7 (eliminating a middle school or two).

2) eliminate busing
Yes IF we make arrangements with AATA to provide extra buses in the morning and student bus passes.

3) have elementary principals supervise two buildings;
NO. There are too many times in my building where both of our administrators are gone and it is very difficult. Elementary schools need their leaders.

4) freeze administration pay and eliminate Board of Education compensation.
The Board gets paid? Outrageous! That should be the first to go.

2) outsource custodial, food service and administrative functions
This one really bothers me. Our cafeteria workers interact with our students daily as do our custodians. They are an important part of our school. Even worse, the quality of the food served in the cafeterias is TERRIBLE and the district is considering outsourcing workers to the firm that is providing that terrible food!

 
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Response to MS Teacher's Comments

I agree for the most part with all the comments made by the MS Teacher in response to Mr. Orr’s essay with one exception: According to their bylaws, BOE Members only get paid $130 a month. While I think it is hard to ask others to take cuts while not taking them yourself, I hardly think their compensation is worth cutting. What this compensation means is that someone without a high outside income could be on the BOE without having to worry about the added costs of childcare and transportation keeping them from attending a meeting. My guess is that most BOE members who can afford it donate far more than this back into our schools through donations of time and money, and fundraising purchases.

 
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Correcting Orr's description of the budget background

Aside from the content of Orr’s proposals, I wanted to kick this off by suggesting that his description of the financial environment the district faces is far too rosy. In his first article, Orr says:

Just what has happened over these past six years to change the fiscally sound situation to the one we face now?

First, enrollment in the district stopped increasing. The demographic studies of the mid- to late 1990s predicted this and it has come to pass. Enrollment in lower elementary grades has been dropping steadily over the past decade. The state-allocated increase in per-pupil funding has increased 11 percent over the past three years. Although not a substantial increase, this is hardly a disaster….

Revenue increasing at 11 percent and expenses increasing at 14 percent has led to what is termed a “structural deficit’‘ of more than $26 million for this past year and the projected three years ahead. There is nothing magical about a “structural deficit’‘ – it simply means that AAPS is committed to spending more then it anticipates receiving, and that this situation is ongoing.

Last June I spoke before the Board of Education and pointed out that the district’s fiscal situation was their responsibility and that there had been no financial surprises over the past six years.

First off, I’m at a loss to understand where Orr got his numbers, particularly the “11% increase in state per-pupil funding over the last three years.” The state’s foundation allowance for AAPS has increased only 4.2% from fiscal 2004 to fiscal 2007 (rising from $9234 to $9619), and that’s not including mid-year cuts of $74 per pupil in fiscal 2004 and perhaps as much as $125 per pupil which may yet be lost this year. Once adjusted for inflation, the foundation allowance (not including “prorations”) has fallen 3.2% since fiscal 2004.

Added to that, required contributions to the state’s Public School Employee Retirement System started mounting as the retirement system’s asset calculation absorbed the stock market collapse of the early part of this decade. The percentage of payroll that districts were required to pay in to the system rose from just over 12% in fiscal 2001 to 17.74% for the current fiscal year. For just the period FY01-FY05, the MPSERS contribution per pupil in Ann Arbor rose from about $760 per pupil to over $1000 per pupil.

Similarly, the cost of health care has been increasing faster than inflation, let alone state school aid. Health care costs shouldered by the district increased over 10% per year, on average, from FY01 to FY05 – rising from $12.5 million to $17.8 million.

This is not to say that more cannot be done to economize, or that innovative solutions aren’t needed in these difficult times. But I think it is unfair to pin the blame for the current budget mess purely on the district; many of the costs faced by the AAPS are not under it’s sole control, and revenue changes are determined at the state level. Any real solution will require both local and state-wide fixes.

 
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Data details

Let me explain where I got my figures:
Foundation allowance data comes from Senate Fiscal Agency publications that show foundation allowance history for each district in the state. Inflation-adjusted figures are calculated using a deflator based on the Detroit/Ann Arbor/Flint metro consumer price index data published by the US Dept. of Labor. Half-year figures were used to approximate fiscal-year rather than calendar year periods. The base year is fiscal 1995. The estimated deflator for fiscal 2007 comes from the state’s recent consensus revenue estimate.

MPSERS contribution rates come from historical summaries published by the Senate Fiscal Agency. Per-pupil cost figures come from the AAPS budget documents, as do the overall health care cost figures.

If anyone would like links to these documents, just let me know.