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5 Money Saving Ideas for RCS

cost cuttingA local resident emailed me yesterday to ask me to attend a meeting last night where the 2008-2009 budget would be discussed. I chose not to attend for two reasons.

First, the union-backed majority of elected board members (Hier, Wilson, Wreford, and Murray) don’t really want to hear the publics ideas as they’ve already got a solution worked out. Even if I voiced my opinion I’d simply be smiled at and not answered.

Second, my family is more important to me than attending a 4 hour long meeting where the public is repeatedly ignored and slapped in the face.

But that doesn’t mean I don’t have ideas. Here are 5 ideas to shave off some fat from the Romeo Community Schools budget. (All of which will be ignored completely!)

A quick review

+ RSC has a budget of roughly $48 million.

+ Roughly 90% of that budget is dedicated to employee costs, about $43 million. 

+ With 653 employees, they spend roughly $66,000 per employee annually.

+ They need to cut $1.3 million from the budget.

+ The remaining $5 million pays for all instructional materials, classroom supplies and equipment, and a billion other miscellaneous things.

+ Most of the 653 employees of the district are union employees, and the largest group– teachers– are working without a contract. Meaning, this contract is open to negotiation.

+ A 5% reduction in overall staffing costs would save the district $2.1 million dollars. 

+ To date, the board has only talked about cutting $1.3 million from the $5 million outside of staffing costs. (With some minor variations.)

+ Note: I don’t have exact numbers because RCS choses to keep their budgets from the people. 

With those facts, let’s examine 5 money saving ideas that will save the district $1.3 million for the next school year… maybe more.
  1. Adjust the health care package of all employees. The health care industry has gone through dramatic changes in the last 3-4 years. The “fat cat municipal” accounts are always increasing their benefits and rarely decrease them. By changing something minor like a co-pay or deductible, there are a few percentage points of savings that no employee would even notice.
  2. Freeze all increases for 2008-2009. Let’s translate what “without a contract” means. It means that the union employees contract continues as is. In other words, they are going to continue getting their annual increases for the next school year if they don’t sign a contract. It means they haven’t gotten a signing bonus the district can’t afford. I don’t know the details, but in general not having a contract is good for the teachers in this situation. (Because even a union-backed board would be committing political suicide to approve increases in a year that the budget will decrease.) By freezing employee increases for 2008-2009, you’ve solved a big chunk of your budget crisis right there. Play out the “what-ifs.” Are you worried about teachers quitting? With unemployment high and every district cutting budgets… teachers have no where to go. Compare the teachers to what happened at American Axel. Union employees just reached an agreement where line workers went from $28/hour to $18/hour in order to save their jobs. I’m not talking about pay decreases, I’m talking about freezing increases!
  3. Contract out some non-instructional labor. I know that this is controversial but lets face it, a major problem in our state is a general denial that our economy cannot support fat union contracts for every employee. In many cases, contracting out the labor for non-instructional labor would save millions of dollars in just 2-3 years. When you include government incentives for hiring minority or female owned businesses, the district could save even more money and the same people would likely be employed by these non-union contractors that are working in our schools today.
  4. Hire local contractors only. I’m rather tired of going to a board meeting and meeting lawyers, builders, architects, planners, and other contract employees of the district who don’t live in the district. Why are we hiring contractors from Rochester, Troy, Sterling Heights, Bloomfield Hills, and Warren and passing up local contractors who could charge less simply based on the mileage? It’s time to keep local dollars local and save some money!
  5. Sweeten the pot for buying out the top. The reality is that for every 30+ year teacher you could likely hire or keep 2-3 teachers with less than 5 years of experience. There are several teachers at each school who could retire in a couple of weeks and save the district some money. Just sweeten the pot a little and you’ve saved yourself some serious cash.
Of course, none of this happened at the meeting. I live in a fantasy world that makes logical sense. Instead the board approved a measure to borrow from a rainy day equity fund. You know, the money they’d need if one of a friendly contractors “accidentally” makes a mistake and a building has to be shut down because they find black mold. Yes, that money. In other words… instead of fixing the problem by making some simple, yet unpopular choices, the board chose by a margin of 5-2 to do nothing. It’s irresponsibility on display for all to see.
 
Why did they do this? Because in a union community a budget shortfall means nothing. (Just ask Ford, GM, and Chrysler!) Bankrupting the state or businesses and passing on the burden to responsible taxpayers is the “right thing to do.” It’s a sad day when 1960s union scare tactics work in 2008. But amazingly, the fog of “union is good for our community” continues to destroy the fabric of Romeo. At least for another year.
Sadly, this just prolongs the pain for another year. Next year, as people continue to leave Michigan the budget cuts will be even worse. And the board will be even less prepared, look more foolish, and make another decision to make matters worse for students and better for staff.
But closing day is coming. There will be a day when reality hits and the district pulls a Donald Trump on the union. They’ll look across the board table and say, “You’re fired.” Instead of preventing that today… the actions of this board, all of it, just march towards that reality in order to avoid a little pain today.
 
My only hope that is in November the people of Romeo tire of these 1960s games and vote to remove the 2 union-backed board members on the ballot. But my hopes aren’t too high.
As always, comments are open. You can even comment anonymously. If you want me to post your comment for you, email it to mclanea@gmail.com. Maybe this is the only place in our community you can discuss this publicly? If it is, let’s hear it!

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4 Responses to 5 Money Saving Ideas for RCS

  1. adam mclane May 28, 2008 at 1:55 pm #

    For those who think I’m a total nutcase. This appeared in today’s Wall Street Journal.

    http://online.wsj.com/article/SB121184546652121307.html?mod=djemEditorialPage

  2. Al Block May 30, 2008 at 8:44 pm #

    Wow, you have some very valid points. It makes too much sense so most likely none of your ideas will seem logical to the school board. :-)

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