January 25, 2011

Making the impossible possible: cutting more than $6 million from the Redmond School District budget

Leslie Pugmire Hole/Spokesman staff

When preparing the 2009- 10 school budget two years ago, the Redmond School District (RSD) faced what seemed then unimaginable losses: The drop in state funding was forcing more than $5 million in cuts.

Yet this winter the district is contemplating a best-case scenario of more than $6 million in cuts and a worst-case vision of slashing more than $10 million from the 2010- 11 spending levels.

“When people first get a real sense of the size of the deficit, there’s an awestruck feeling of 'How can we possibly do this?’” says Mike McIntosh, RSD director of operations and fiscal services for the district.

When RSD faced its first huge deficit in 2009, it responded by laying off more than 50 teachers, condensing the school week to four days and myriad other smaller cost concessions.

The district will be forced to take multiple fiscal hits in the 2011-12 school year, beyond the decline in state funding. It expects continued declining enrollment, which could mean as much as $1.3 million less funding. A rise in PERS rates for employee retirement accounts will cost an estimated $1.5 million beyond what is already budgeted and a real estate payment that must come from general funds is expected at $741,000.

In addition, current employee union contracts contain provisions that will add another $2.4 million in deficits, including adding back deferred cost-of-living raises, cut school days, as well as pay increases for length of service and increased education.

This year the district got a jump on budget discussions, convening a task force of principals, departmental managers and other district staff, beginning in November.

“In the past we usually don’t start budget discussions until the March state forecast,” says McIntosh. “But this year we knew would be crazy enough that we had better start early.”

Another big change this year has been the involvement of local representatives from the two labor unions for district employees, Redmond Education Association and S.E.I.U., in early budget talks.

“With change in administration there’s been a change in how we deal with our stakeholders,” says McIntosh. “There’s no question that discussions with the labor groups will be key. There are only so many places to come up with those kinds of dollars.”

Although technically the district does not need to notify staff of potential layoffs until late spring, McIntosh says every effort will be made to make that announcement sooner, so employees can plan.

The 2010 school year began with a flat staffing level from the 2009 reduction in force and some teaching positions were funded through federal stimulus grants; those monies will not be available next year.

“I’ve been pleased with the team’s receptiveness and willingness to listen,” says Dru Carpenter, president of the Redmond S.E.I.U. chapter, which represents the non-licensed employees. “There’s been a lot of honest transparency right up front.”

The current three-year contract for the licensed staff will expire in June; negotiations are beginning next week.

“I expect our next contracts will be a one-year agreement,” says McIntosh. “It’s too difficult to predict how things might change in this current economy with three-year contracts.”

The S.E.I.U. classified contract is midway through its cycle but this year will revisit compensation discussions.

“It’s frustrating to me,” says Judy Newman, president of the Redmond Education Association, the union for teachers and other certified staff. “We cut so much already, I don’t know where we’re going to go with that. I’m hoping we’re all on the same page.”

According to McIntosh some staff reductions are likely but it’s impossible to know what effect that will have on actual layoffs. Retirements and resignations often reduce the need for layoffs, instead resulting in cut positions, not people. The district is looking at the possibility of early retirement incentives but less as a cost-savings than a position-saver; when more staff retire, others can step into that position in lieu of being laid off.

“We’re walking in unprecedented times,” says McIntosh “We appreciate participation from the union reps; we’re not going to get there any other way.”

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