Schools prepare for possible financial shortfall
Cuts could be ‘devastating’
MARQUETTE — Talk about a moving target.
With the COVID-19 crisis resulting in many fiscal shortfalls in Michigan, schools face massive cuts, so local school districts are trying to plan for the financial unknown.
Superintendents from the NICE, Ishpeming, Negaunee, Gwinn and Marquette school districts expressed their concerns via email over the situation.
“We are hearing many different projections regarding cuts,” said Bryan DeAugustine, superintendent of NICE Community Schools. “The speculation has ranged from around $400 up to $1,000 per pupil.
“I believe our legislators will realize that many schools will not survive a 25% reduction in funding. At that level, schools around our state will be forced to close and those that remain open will be drastically altered in negative ways.”
DeAugustine acknowledged the district is worried about the cuts, but expressed some optimism.
“We are also hopeful that our federal legislators will support a stimulus package to assist our state and the others around our country until we get our economy up and running again,” DeAugustine said. “Schools have been very frugal since the last recession. Districts like ours here at NICE Community Schools try to maximize every dollar we receive to give our students a well-rounded education. Even for a district like ours with a responsible fund balance, if the projected cuts come to pass, the effects will be devastating. We are preparing for the worst, while also being hopeful that our federal representatives and senators around our nation will do the right thing by sending federal assistance.”
According to an Associated Press story, the state is facing a nearly $6.3 billion revenue hole over this fiscal year and the next one.
Marquette Area Public Schools Superintendent Bill Saunders said the district has heard “numbers all over the board” as far as a cut or proration.
“After the revenue estimating conference in May, it sounded like we would be prorated $600 to $700 in current year — $2 million-plus to MAPS — and would receive a cut to the foundation in the upcoming year of $600 or more — another $2 million,” Saunders said.
MAPS has trimmed back all aspects of its budget moving forward, he said. “We are working on minimizing any personnel cuts by not filling retiree/resignation positions,” Saunders said. “For any deeper cuts, we are waiting until we know more about the actual cut number and also what our fall configuration may look like.”
Ishpeming Public Schools already has been proactive, particuarly at a recent board of education meeting where the board approved a voluntary severance plan.
“What we are hearing is that our state aid is going to be reduced for possibly this school year, and next school year,” IPS Superintendent Carrie Meyer said. “We are being told that the result could be devastating to all public school systems. As a result, the Ishpeming public school district is looking at various options to try and balance the budget.”
The voluntary severance plan, she said, offers $20,000 to be paid over two years if three Ishpeming Education Association members apply, or $25,000 to be paid over two years if at least five IEA members apply. For a teacher to qualify for the plan, the IEA member must have taught for IPS for at least 15 years.
“This plan would allow the district to either hire a lower paid teacher or absorb the position by passing the classes to existing staff members, depending who decides to leave the district,” Meyer said.
Negaunee Public Schools Superintendent Dan Skewis has been keeping track of the situation too.
“We have a few different plans in place, depending on the severity of the reduction,” Skewis said. “It’s difficult because we haven’t been given a firm dollar amount to center our budget around. With this in mind, all options are being analyzed.
“Whatever the case, our adjustments will be made with our students’ needs in mind. We don’t anticipate adjusting our game plan in a way that would direct us away from quality learning opportunities both in and out of the classroom.”
Gwinn Area Community Schools Superintendent Sandy Petrovich acknowledged that although no formal cuts have been made yet, the district is preparing for the worst-case scenario.
“This worst case scenario of a $700 per student proration this year came from statewide meetings with state personnel,” Petrovich said. “Making the move to budget from this standpoint allows us to plan for what we think will be the worst situation and make plans accordingly.
“If this probation does not occur yet this fiscal year for the state or it is not to that magnitude, then we will be ahead in our budget and have more in-house funds with which to work. Our CARES (Coronavirus Aid, Relief and Economic Security) Act funding helps us considerably in softening this blow as does some savings throughout the district this past quarter.”
Petrovich pointed out that although the state required the district to pay all employees, it saw savings in transportation, substitute teaching costs and many other areas. However, no retirees are being replaced.
“We are hopeful that we will not see a proration this year nor a deep cut in funding such as what we are preparing to see,” Petrovich said. “We hope we do see additional aid next year through the potential HEROES (Health and Economic Recovery Omnibus Emergency Solutions) Act to keep us from making deep in-district cuts to balance our budget at amendment time in January 2021.”