I can scarcely begin today’s post because I don’t know which item to tackle first. For those who don’ t have the paper or haven’t seen it yet — here are my choices:
- Documents in Right-to-Know case released – page 1
- Tredyffrin Republicans will have a new look – page 1
- Editorial: “We Need to do things a little different around here” page 2
- Chester County employees put on notice that pay raises may be eliminated – page 23
I think what I would like to tackle today (in light of the fact that tonight is TE’s Finance Committee meeting) is the 4th one — which is sort of back there in the paper and might not get noticed. It’s online from the Feb 15th Daily Local. http://www.dailylocal.com/articles/2009/02/15/news/srv0000004699694.txt
The purpose of the article is to outline budget planning for 2010 — “Chester County finance officials have told department heads and elected officials they should plan to reduce their operating budgets 2 to 4 percent for next year.” (Note: The Chester County Finance Director is Denny Bolton, who was a long-time business manager for Owen J Roberts School District — so he knows the ins and outs of school spending as well as government spending). It is unlikely that any school district would plan for a spending decrease (which is where the editorial about doing things different (sic) comes in),
Key comments from article:
…the department heads and elected officials were urged to prepare two sets of preliminary budgets. One option should be for a 2 percent reduction, another for a 4 percent reduction …”This may be accomplished by eliminating nonmandated programs that do not align with the strategic goals or identifying operational savings…In either case, (2 or 4% decrease) officials may need to eliminate any annual salary increase for employees in 2010.
As the article continues, some speculate that they do this worrying often and don’t believe anything will come of it. There are some sounds of indignation that county employees would not get the 3.75% raises that (apparently) some feel they are entitled to. But there is also the comment by County Controller DiGiorgio
“The vast majority of the over 2,500 county employees who work for our government do a great job,” DiGiorgio said at that meeting. “They deserve to be treated with respect. However, we need to consider whether it is prudent to provide them with a raise of 3.75 percent while recession-hit Chester County taxpayers will be seeing very little in the way of salary increases in 2009 and, in some cases, may lose their jobs in these hard economic times.”
Citizens of our community need to engage in the budget process. T-E (and many districts across the state) see the state-mandated “cap” as the floor to their tax plans — not the ceiling. A 4.1% increase does not have to be voted on by the public (beyond that increase, there are only specific reasons to increase taxes without triggering a referendum–so the “secret” is to stay at or below the cap line). So instead of worrying about what to spend, boards are more concerned with how much they can increase without scrutiny. How about a rebate?
Many school districts (and TE is certainly a leader in this) have significant “fund balances” — reserve money that has accumulated in the good times of real estate transfer tax growth and investment interest. T-E’s fund balance exceeds $50 million. So with a budget of $100+ million, and no plans to reduce spending, they are planning a 4.1% tax increase AND to use approximately $4 M from the fund balance to offset spending increases.
Taxes are a funny thing — people don’t talk about the tax bill — only the increase. Hey — you pay the whole thing. Has anyone thought about using fund balance to pay half the taxes? Give today’s residents our own school tax holiday? Sure that means next year (or maybe not until the year after) taxes would “double”, but it’s our money they are sitting on and not spending on these increases or costs. Future residents are not stuck with our debt — they are spending our savings.
There are lots of reasons this would be complicated — and would require some serious “out of the box” thinking. ( I live by the notion that if I have an idea — it can happen. It just takes effort.) But as our teachers sit in negotiations and see our reserves piling up, why would they ever step up and participate in the real economy — the one that doesn’t have annual raises OR tenure OR lucrative employee benefit plans OR pensions OR collective bargaining with the right to strike and shut down a community education program? (That sounds like a knock at OUR teachers, but as I have stated previously, and will talk about again — our local organization (TEEA) is strongly encouraged [read: pressured] by the state organization PSEA….you know — the one whose goal is a starting salary statewide for BRAND NEW TEACHERS right out of college, no experience — of $50,000 — accumulating 2.5% a year toward a pension with 10 years to the top salary).
More later. Tonight (Thursday) is the TE Finance Meeting. Maybe some of us should plan to be there? Check out the TESD.net website for time and place. In the meantime, please share your thoughts about these topics and any you want to talk about.