Ahmed Ismail's Points about the Pointes

GP School Board Candidates Accepting Union Money??

  As many of you know, I just authored a blog posting about my concerns over union involvement with Grosse Pointe's upcoming School Board election and the potential conflict of interest it creates for any candidate who accepts union donations of manpower and/or cash for their campaign.

  Not 10 minutes after sending my e-newsletter, I received an e-mail from a concerned citizen who subscribes to my newsletter with a link to a campaign report filed with the State of Michigan.  According to this report, Mr. Roeske and Mrs. Valente have received $500 each from the Michigan Education Association (MEA) Local 1.  This report is only for a few month's time and is only for this particular one of about 20 PACs that the MEA uses to funnel campaign donations.  It also does not include any donations made by our local union, the Grosse Pointe Education Association (GPEA).

  Should they be elected (and at least one of them will), how can Mr. Roeske and Mrs. Valente possibly vote on the school system union pay and benefit contracts without having a conflict of interest, even under the broadest of interpretations?

  Even if they were to give the money back right now, the use of it and the union connection will have served its purpose.  It's a sad day in Grosse Pointe for yours truly to see this happen in our community.

 

 

The Upcoming School Board Election and Union Endorsements--How Close is Too Close?

  Next week's School Board election will be an interesting one.  Board President John Steininger and Board Trustee Fred Minturn have decided to not seek re-election.  This leaves two four year terms open for three candidates--Dan Roeske, Lois Valente and Diane Karabetsos.

  Dozens of readers of this blog have called to ask my advice on who to vote for in next week's election.  I'd like to share my thoughts and research with you on this issue, especially in light of a letter which the MEA (the State teachers union organization) sent out on behalf of the GPEA (the Grosse Pointe teachers union).

  First, I don't know Mr. Roeske.  Mrs. Valente was kind enough to get together with me a few months ago to discuss our schools, as did Mrs. Karabetsos.  Both women seem to be honest and sincere people, wanting to do what is best for our kids, as I am sure Mr. Roeske does.  All three seem to be intelligent people. 

  Other than that, I don't know much more about the candidates than we all have read online and in the local newspapers (which hasn't been much of any substance).  The media has artfully danced around the toughest question that faces our school system and these new Board members, namely what are each of the candidates going to do to deal with rising costs and declining income (other than pray for grant money or the GP Foundation raising money)?

  Since 85% of our budget goes to salaries, the discussion on rising costs and declining income has to lead to our labor contracts.  We have spent down our fund equity (our savings account for rainy days) from close to $20 million down to under $10 million in the span of only three years.  Our bond rating with Moody's is sure to be adjusted downward as a result, and hence the interest rate we pay when we borrow is sure to increase.  Under our labor contracts (which all expire in 1-1/2 years), the staff in the 2012-13 school year will be taking pay cuts to equal 85% of any shortfall below the a $10 million fund equity (10% of our gross revenues).  We are below this 10% threshold now, and many of the School Board members don't seem to be too concerned about letting it drop further.

  According to some senior school system administrators, this pay reduction for 2012-13 will be somewhere in the neighborhood of 5%-8% of EVERY staff member's paycheck.  With pay cuts to continue under the contracts on the one side and Governor Snyder in Lansing pushing from the other side to control public employee health care and retirement costs and institute merit pay instead of seniority pay, the Grosse Pointe Education Association (GPEA) and the Michigan Education Association (MEA) don't need a crystal ball to see that they need all the friends they can get, both locally and in Lansing.

  Enter the political endorsement process.  Being a "public education junkie", I have been following school board elections all across the nation.  For some interesting reading on what's going on, click here, here and here to read three of these articles.  Another great article on the subject appeared in Education Report.

  The bottom line is that the education-related unions are getting organized and using their clout to support candidates (both with manpower and funding) who they feel might be friendly to their challenges in upcoming contract negotiations, which are sure to be contentious at best.  For a year old list of just some of the school board election donations the Michigan union PACs have made, click here.  Unfortunately, we won't know if any Grosse Pointe candidates will be added to this monetary donation list until after next week's election.  

  Our local GPEA has endorsed school board candidates in some of the past few years.  A retired teacher brought in the letter from the GPEA to its members to show me this past Saturday.  The letter is urging all GPEA members to support Dan Roeske and Lois Valente for our school board.  Please take the time to read this letter.  The envelope it came in had the return address of the MEA in Clinton Township on it, so now we know that the State offices of the teachers' union are very interested in what happens in the Grosse Pointe's school board election.

   The question that came ot my mind when I read the GPEA letter was whether or not accepting the endorsement of the staff unions will unknowingly put Mr. Roeske and Mrs. Valente in a conflict of interest should they be elected when it comes to voting on any labor contracts.  Will Mr. Roeske and Mrs. Valente have to recuse themselves from any votes on these contracts?

  The jury is out on this question.  Our School Board policies address conflict of interests, but only in the broadest of terms.  The way I see it, there are two kinds of conflicts of interest in play here--a legal one and an ethical one.  Based on what I have been able to find in my research, there is no legal conflict of interest created for Mr. Roeske or Mrs. Valente by accepting a general endorsement in their election efforts.  The gray area in the law (and in our Board policy) starts when any kind of monetary aid (in the form of in-kind or real donations) occurs.  A number of experts around the country do believe that accepting an endorsement from a staff member groups on which a prospective Board member will vote on labor contracts is surely an ethical one, especially when either in-kind (manpower) or actual cash donations are involved. 

    Mike Reno, a friend and former Rochester School Board trustee covered the topic in a very easy to understand Op-Ed piece in the Detroit News.  Mike has had first hand experience dealing with the power of the union machine in Rochester, where some Board members received thousands of dollars in support from teacher-related unions for their election campaigns.  He has the same ethical conerns that I have regarding a Board member voting on the pay and benefits of someone from whom he has accepted a donation.  It just doesn't pass the "smell" test for either one of us.

  The bottom line for us as a community is what level of ethical integrity do we want from our School Board members?  Accepting an endorsement and its accompanying manpower and/or funding carries an unwritten obligation for a possible quid pro quo at some time in the future.  Our candidates have to stay above reproach on this issue.  We can't put ourselves in the position of having elected officials whose elections have been funded and manpowered by the very people on whose salaries and benefits they will be voting.

  Take the time to absorb the letter from the GPEA and what they feel each candidate stands for and why they are endorsing them.  It will be very hard for Mrs. Karabetsos to compete against the union machine that has kicked in to get Mr. Roeske and Mrs. Valente elected.  The only hope she has is to make her case clear that she does not believe it is ethical for a school board member to take any monies from a political PAC group like the MEA or the GPEA and to pledge to NEVER take funds from any labor group with which the school does business, and that the voters listen and agree.

  Will Grosse Pointe voters realize the danger of electing the union slate in next week's school board election?  With only three candidates running for two seats, one of the union's candidates is a shoe-in.  We'll know in just five days if our unions are successful in getting both of their candidates on our school board.  I hope you'll play it safe for our kids and our community and cast one of your votes for Diane Karabetsos, for whom there is no potential union endorsement conflict of interest.  If you know the other two candidates, for the community's sake, please encourage them to stay above reproach by refusing any manpower or monetary donations from any of our labor unions or their related PACs, as there is nothing I would like more than for them to prove my conflict of interest concerns to be unfounded.

Best wishes,

 

 Editor's Note:  Read my next post--my fears seem to be true.  :(

It's Time for the Grosse Pointe Schools 2010-11 Budget Cuts

It's that time of year again--time for the School Board to put together the budget for the 2010-11 school year.  The same forces will drive the budget as they did when I was on the School Board, and the low hanging fruit to cut without impacting the classroom has been picked pretty well in prior years.

For those of you who aren't up on how our schools are funded and what drives our need to make cuts, here goes Ahmed's five minute "School Economics 101" lesson.

The school system's total income per year is about $102 million.  Our income comes to us from the State of Michigan, and is based on an allotment of about $11,000 per student per school year.  Our enrollment is declining year after year at the rate of about 130 students, which in rough numbers means our funds to spend decline about $1.5 million per year ASSUMING that the State doesn't cut our per student allotment.

Unfortunately, the State did cut our per student allotment this past year, and they did it MID YEAR in October 2009 after we had completed our budget back in July 2009.  This unanticipated cut forced us to use our "rainy day" account (Fund Equity) to the tune of about $2.5 million to make it through the end of the 2009-10 school year without having to cut class offerings and staff mid-year.  Many school systems were more aggressive than we have been, and made mid year cuts.  Troy, for instance, cut $1 million mid year by eliminating two contracted assistant principals at their high schools and other cost cutting moves that would not impact the students mid year. 

In contrast to declining income, our costs are going UP, UP, UP by virtue of the cost of our most important asset, our staff.  You see, about 85% of our expenses every year are payroll related.  With that high a percentage of our costs being payroll, increases in the cost of health care, union contract longevity pay increases and State mandated retirement cost increases are burning a hole in our wallet.  Add these increased costs to the declining income outlined above, and that hole in our wallet will be about $7.3 million wide for the 2010-11 school year.  With 85% of our budget going to human resources, guess where the vast majority of cuts need to come from?

That is the challenge facing the administration and the School Board.  A first stab at a budget was presented to the School Board by Brendan Walsh at the February Board meeting in a 34 page PowerPoint entitled, "2010-11 Budget Draft #1".  Brendan followed up this draft budget with a 38 page PowerPoint entitled, "2010-11 Budget Draft #2" at the March Board meeting.  Individual Board members and the public will have an opportunity for input on these proposals at the Monday, April 12th Board meeting, which will be held in Grosse Pointe North's Library at 8PM.  This meeting is especially important, as the Board must provide layoff notices to teachers for the 2010-11 school year by the end of this month.

Being a bit of a spreadsheet addict, I took apart the Draft 2 proposal and created a one page budget cut spreadsheet which outlines (as best I could extract) the staffing cuts proposed in Draft 2.  I have to thank Chris Fenton and Isha Smith at the Board Office for answering my questions on Draft 2.  Their help in putting together this spreadsheet was invaluable.

As you can see from my spreadsheet, about $6.3 million in staffing cuts have been proposed.  That leaves $1 million to be found elsewhere, either in additional cuts to staff and operating costs and/or the use of Fund Equity.  With fund equity being chipped away at to the tune of $2.5 million so far this year, I don't think another $1 million use of Fund Equity is going to be a palatable solution to the School Board.

Over the past few weeks, I have been asked more times than I can count what I think the School Board and the administration should do.  Frankly, it's the reason I did the budget cut spreadsheet referenced above--I wanted to see the entire picture on one page.  After looking at it, I would recommend the following to the School Board:

1.  Start Making Cuts in Building Level Management.  In all the years I have been watching and/or served on the Board, the building level management has never felt the budget axe.  We have wonderful people in these positions, some of whom I consider true friends.  Unfortunately, like in every other company in the State, middle management positions need to be reduced along with the other staff and the remaining middle management job desriptions need to be redefined.  The Board should be looking at the sharing of principals at our under-populated elementary schools, and the sharing of assistant principals in the middle schools.  While sharing Athletic Directors is not feasible at the high school level, creative concepts being used elsewhere like having assistant principals teach a .2 or .4 FTE in their subject area would lighten the middle management budget load.  Sharing an assistant principal by making them a Dean of Students should also be explored along with these other options if we truly want to keep cost cutting away from classroom programs.  Conservatively, thinking outside of the box in this area alone could generate $600,000 in savings.

2.  Redefine the High School Department Chair Job Descriptions.  In each of our high schools, we pay about $5,000 per year extra to a teacher who serves as the department chair for that subject area. Under Budget Draft #2 referenced above, the high school department chair positions are being eliminated to save $220,094.  In my mind, it is foolish to think that the work the Science Department or any other department chair can be taken over by administrative staff, some of who have never taught in a classroom in the last decade, or for that matter, ever.  This cut can be restored by redefining the job descriptions of the department chairs to include some of the duties of the Central Office Curriculum Department (like selecting textbooks) and the elimination or reduction of the contracted staff we utilize in the Curriculum Department, thus saving the $220,094.

3.  Raise Class Size in the High Schools.  According to the schools system's financial manager, Chris Fenton, for every ONE student we raise class size at the high school level, we save 5 teachers which (at the average cost per teacher being used by the Board in its budgeting) is about $600,000 in teacher salaries.  That is a staggering number.  I wouldn't think twice about raising our class size at the high schools by an average of one student, thus garnering $600,000 in much needed savings.

If the Board were to take even a conservative approach to adopting the three suggestions above, it would solve its shortfall for the 2010-11 school year.  It doesn't solve the long term problem we are facing, which will be the subject of my next article, so stay tuned!

The Boll Foundation Technology Grant

The Grosse Pointe Foundation for Public Education (GPFPE) is a foundation formed by a group of very dedicated Pointers who were conerned about maintaining excellence in our schools.  Its purpose is to raise money to fund initiatives in the Grosse Pointe schools. 

The Foundation has gained some incredible momentum in its work the past few years, thanks to the hard work of the founding members and too many other Pointers to name in this posting.  The icing on the cake for the Foundation has been the incredible generosity of John and Marlene Boll of the Shores.  Two years ago, John and Marlene donated $500,000 towards the completion of the GP South Natatorium and Health Center (now the Boll Center).

The Foundation had their first Gala fundraiser on March 27th, which was an incredible success on all counts.  The event was held at the home of Jim and Carol Schebil.  Close to 200 guests attended.  All told, the live auction and the sold out ticket sales raised around $40,000 for the foundation.  One of the fun things for me was seeing an old, old friend, Bruce Hubbard, who was the photographer for the evening.  Bruce captured the rare picture of Mary Ann and I (we are usually taking the pictures) to the right.

In a surprise announcement, John and Marlene Boll again stepped up to the plate and announced the $500,000 Boll Technology Challenge Grant.  The grant is to be used to update the technology in our schools with items like SmartBoards.  Under the terms of the grant, every $1 raised by the GPFPE earmarked towards technology will be matched with $2 by The Boll Foundation.  As of the day after the Gala, the GPFPE had raised $110,000 which is earmarked to match John and Marlene's generosity.

To the left is a great picture that Bruce Hubbard took of (left to right) Marlene and John Boll and Mary Ann and Bob Bury. 

For more information on the Boll Challenge Grant, please click here or visit the Grosse Pointe Foundation for Public Education web site at www.gpfpe.org. 

Grosse Pointe Schools Election Results Are In!

Well, the results are in for the various elections around town, most notably the election of three members of our Grosse Pointe School Board and two school tax millages which were up for renewal.  A complete tally of the votes by municipality are available on the Grosse Pointe Park web site or by clicking here.

The winners of the two four year seats on the School Board are Joan Dindoffer and Tom Jakubiec.

The winner of the neck-and-neck race for the three year seat is Cindy Pangborn.

The Operating millage renewal passed with about a 2 to 1 "YES" vote.  The Sinking Fund millage passed with about the same margin.

This is really a great day for our schools.  We have brought back someone with an incredible institutional history of the school system and the School Board and a great knowledge of curriculum in re-electing Joan Dindoffer.  We have brought on a young man with a passion for our community and our kids in Tom Jakubiec, and we have returned a veteran Board member, Cindy Pangborn, with a real knowledge of the real estate market and what we need to be offering in our schools to compete with Troy, Novi, Bloomfield Hills and Birmingham for new residents.

In addition, the entire community overwhelmingly affirmed the value it places on our schools by passing the millage renewals with such incredible margins.  I am confident our three newly elected School Board members will work diligently to make sure that these millage funds are spent wisely and with caution.

I want to extend my sincere thanks to all of my subscribers who followed my recommendations in the voting booth today.  You have done our entire community a tremendous service.  I look forward to seeing Joan, Tom and Cindy bring more public discourse and independent thinking to our School Board at a time when it is needed most.

Thank you,

 

Reality Check Quote from Lansing

I thought you would all enjoy this quote from Bob Kolt, a political strategist, on our State Budget:

" . . . I don't think we should even call it a budget anymore; it's more like a wish list. Here is a document we wish was true but know is not.  Here is a list of programs we wish could be funded but know can't be, because we wish we had the money but know we don't."

My Take on the Grosse Pointe Public School System's Hold Harmless and Sinking Fund Millages

On November 3rd, in addition to selecting three School Board members, you are also going to be asked to approve what are basically renewals of the Hold Harmless and Sinking Fund millages that serve very important roles in the funding of our schools.  In order that you be able to vote intelligently on these issues, I thought it best to dedicate an article to explaining what these millages are, what part they play in the funding of our schools and (naturally) my recommendation on how you should vote on these two important millages.

The Hold Harmless Millage

First, I am going to give you a nutshell view of the Hold Harmless millage and how it came about.  If you are a numbers addict and into heavy reading and lots of pie charts and spreadsheets, the State of Michigan prepared an excellent analysis back in 1994 when it came into being, which you can read by clicking here.  A much more digestible history of the Hold Harmless millage was prepared by The Mackinac Center.  It can be accessed here.  A great summary of the problem and the solutions Troy Schools is considering is available here.

The bottom line is that the Hold Harmless millage allows us to keep a portion of our school taxes local.  Grosse Pointe's hold harmless at stake is a staggering $22,910,000 of school funding in the first year. To help put this in perspective for you in a purely theoretical example, if we don't get the $22,910,000, the only expense we have large enough to cover this loss is our staff expense.  Based on a third of our year being gone, if we had the cover the amount through staff reductions, it would mean IMMEDIATE lay offs of  381 teachers effective November 1st would have to be made.  Assuming we had a teacher contract that allowed this magnitude of layoffs, what would we do with all of the kids that were in the laid off teacher's classrooms?

The magnitude of the cuts necessary to make up for the loss of these Hold Harmless funds would be the most devastating loss in the history of our school system.  Imagine having to cut 23% of all of your offerings.  The school system as we know it today would be gone.  This is why my recommendation for your vote on the Hold Harmless millage is an unqualified YES.  We just don't have a choice.

The Sinking Fund Millage

The Sinking Fund millage is quite a different item.  It came about as a State approved way to pay for repairs of buildings and parking lots.  A great source of information on the purpose of sinking funds was prepared by The Mackinac Center and is available here.  Although the school system presents the public with a list of projects they anticipating doing with the funds, they are not bound (other than ethically) to spend the money on specific repair projects.  This was done so that the school system would have the flexibility to use these funds for emergency projects like water main breaks.

The funds cannot be used for personnel or office expense.  The Sinking Funds can only be used for repairs and maintenance of our aging buildings.  The funds from this millage will provide the school system with about $2.9 million in funds for these repairs each year.

Our school system has prepared a "proposed" list of projects which are anticipated to be completed with the Sinking Fund receipts each year.  For a copy of it, click here.  I am familiar with the list of projects, as I served as the Board Construction Liaison for many years, overseeing the administration's construction budgets and priorities.  The listed projects are ones that need to be done.  The order in which they are slated to be completed also makes sense.  Although I am uncomfortable with not having a definitive list of projects with a contingency budget for emergencies, there is nothing unorthodox about how the administration is structuring the management of the sue of these funds.

The alternative to not passing the Sinking Fund is that the cost of all of these repairs would have to come out of the General Fund, which (especially after this week) is severely strapped.  The General Fund doesn't have the funds necessary to pay for the ongoing maintenance that our old buildings need.  It is for these reason that I reservedly make a YES recommendation on your vote on the Sinking Fund millage.  I will be looking to the administration to follow the project list to the "T" and will be reporting to you if I see that they are straying from their commitment.

My Picks for the November School Board Election

On November 3rd, one of the items you will be voting on is three seats on our Grosse Pointe School Board.  Many of you have called and e-mailed me to ask who to vote for and to get information on the other issues on the November ballot.  I hope this e-newsletter answers many of your questions.

Two of the seats are for four year terms and one of the spots is for a three year term.  The candidates for the two fours year seats are Joan Dindoffer (an incumbent), Tom Jakubiec, George McMullen, Michelle Peabody and Anthony Ambrogio.  The candidates for the three year seat are Cindy Pangborn and Karl Kratz.

Two of the things I feel is so important on any board is having Board members with diversity of opinion and having Board members who are willing to listen to other opinions, digest the information presented and make intelligent decisions for the good of the community and not just a particular special interest group.  The last thing our School Board needs is three new Board members who all "go with the flow" and don't question everything we are doing now with the desire to do it better in the future.

With that in mind, here are my recommendations to you for the three School Board positions:

Joan Dindoffer
Joan is really a no brainer for one of the four year spots.  Joan has served on the School Board since 1997.  She has served in every office of the School Board and is the "historian" of sorts for the School Board.  Her background on school related issues is an invaluable asset to the Board, as is her knowledge of curriculum issues.  During my tenure on the Board, I would always turn to Joan for guidance on issues that had been brought up prior to my joining the Board in 2004.  With my departure from the Board, the longest serving member other than Joan has been on the Board for only four years. 

In terms of formal education in school board governance and operation, with my departure from the Board, Joan was left as the only member of the School to receive any awards from the Michigan Association of School Boards (MASB) above the most basic level.  Her formal education through MASB has served the Board well and would continue to be an asset should she be re-elected.  This education will be especially important as our central office administrators reach retirement age (three out of four could retire tomorrow if they chose) and a national search is undertaken for their successors.

I could fill this whole newsletter with Joan's qualifications.  If you'd like to read all of them and some of her history with the school system prior to her serving on the school board, click here.

Joan's full time occupation is as an attorney with Comerica.  She resides in the Park with her husband, Fred, and has three sons who followed the Defer-Pierce-Grosse Pointe South track through our schools.  Her home phone number is 313-881-6750 and her e-mail address is fdindoffer@aol.com.  Donations to her campaign can be sent to: The Committee to Re-Elect Joan Dindoffer, 1375 Three Mile Drive, Grosse Pointe Park, MI 48230.

Tom Jakubiec
One of the things that irks me about our annual school board elections is the sudden interest that new candidates have in the school system, showing up for Board meetings out of the blue, never saying anything, but just "being there", sometimes just so they can say they attended Board meetings at the League of Women Voters forum prior to the elections.  This is NOT Tom Jakubiec.  I first met Tom last year at one of the Board meetings where a heated discussion was taking placing about a residency issue.  He went to the microphone and expressed serious reservations about the issue and reminded the Board that it is there to listen to and serve the community and not the other way around.  When he said that, I said "HALLELUJAH" to myself--someone else gets the picture.

Since that time, Tom has attended just about every Board meeting and has never been afraid to let his opinion be known, whether it is on residency issues or making structural changes to how our school dollars are spent.  He impresses me as an independent thinker who does his research, is willing to genuinely listen to other opinions with courtesy and respect, then calls it the way he sees it.  I think Tom will be a good listener to the residents and will be an advocate for what is best for the ENTIRE community.

Residency enforcement and safety in and security of our school buildings are two concerns I share with Tom.  I am confident he will make these priorities if he is elected to the School Board.

Tom is an industrial engineer who understands process control and cost control.  I think his knowledge of analyzing work and production flows can help the School Board as the inevitable restructuring of how we educate our children due to State funding cuts takes place.  If you'd like to read Tom's own thoughts on our school system, please click here.

He and his wife, Billi, are Woods residents.  Their two sons attend Ferry Elementary.  Tom can be reached at 313-308-7020 or at vote_for_tom@yahoo.com.  Donations to help Tom with his campaign can be sent to: Tom Jakubiec for School Board Committee, 1361 Yorktown, Grosse Pointe Woods, MI 48236.

Cindy Pangborn
With 85% of our homeowners not having students in our schools, someone has to have a focus on the value of our schools to those residents---their property values.  That's where Cindy Pangborn, a long time Grosse Pointe Realtor with Johnstone and Johnstone, comes in.  After all, who is going to be more in tune with property values than one of our local realtors?

Cindy comes to the election with a lot more than just being a local realtor.  She is a past School Board member, serving four years through 2000.  Like me, she is maniacal about our Board meetings being run with respect for the residents attending in mind.  During her prior term on he School Board, she instituted the filming of and televising of our School Board meetings.  Cindy does her research on issues and is passionate about our schools and our community.

Cindy has gone "high tech" for her campaign and has set up a blog with more information on her views.  Please take the time to visit it by clicking here.

Cindy is a home grown Pointer, having graduated from Grosse Pointe High School in 1964.  All of Cindy's children attended our schools.  She lives in the Woods with her husband, Jim, and can be reached at cindypangborn@gmail.comor at 313-885-9046.  Donations to her campaign can be sent to:  Committee to Elect Cindy Pangborn, 19976 Holiday Road, Grosse Pointe Woods, MI 48236.


What Can You Do to Help These Candidates?
If you're as concerned as I am about the direction in which our schools are headed, you need to help make sure these three candidates are elected to our School Board.  You can help do this in these five ways:

1.  Put up a Lawn Sign.  The single most effective advertising these candidates can do is in your hands.  They need a sign up on your lawn.  Let your neighbors know you support a diverse School Board.  If you'd like their signs, you can e-mail them or call them directly using the information I provided above or just e-mail me with your address and I'll make sure you get their signs.  If you want to stop by my house at 799 Lochmoor (on the corner of Wedgewood), signs are also available for pick-up next to my garage.

2.  Forward a Link to this Blog Article to a Friend.  Please, forward this e-mail to a friend or, better yet, your entire e-mail list.  Get the word out!

3.  Send a Small Donation.  Running a School Board campaign isn't cheap.  They all need your financial support by way of a small donation to help pay for signs and other advertising.  A small donation of $10 helps cover the cost of three signs, so please help Joan, Tom and Cindy out as much as you can.

4.  Volunteer to Help at the Polls.  There are a lot of people who come to the polls on election day without a clue as to the issues at hand or about the backgrounds of the candidates.  Even if you have only an hour to spare on election day, all three of these candidates could use your help passing out flyers.

5.  Vote, Vote, Vote!  If you don't vote, all of the above mean nothing.  Your vote can be the deciding one, especially this year.  Please take the time to vote, either in person or by absentee ballot.

Please question these candidates with your concerns, and let them know your thoughts.  I know you will find them willing to listen to and learn from you.
 
In closing, I cannot tell you how important it is that these three candidates are ALL elected to our School Board.  Our property values and the preparation our students have for the new global workplace depends on having independent thinking School Board members who are not locked into business as usual.  I am confident that Joan, Tom and Cindy are up to the challenge, so please support them on November 3rd!

Lansing Cuts Grosse Pointe School Funding a Whopping $4.1 Million!

This past week has borne the worst financial news I have ever seen in all the years I have been studying and working with the Grosse Pointe Public School System.  The source of the angst can be summed up in one word--LANSING!  It happened in three stabs from the Lansing budget cut knife.  They are (in a nutshell):

Stab No. 1--the Foundation Allowance Cut
It all started out on Monday night when Governor Granholm finally got around to reviewing and ultimately approving the School Aid Fund (SAF).  This fund which is the source of the majority of the funding Lansing sends every public school system in Michigan.  It is about $7,300 per student per year.

Even though we put our Grosse Pointe school budget to bed July 1 based on the revenue promised from Lansing, the legislature submitted a budget to Granholm which called for a reduction of $165 per student due to a decline in State income primarily from sales tax.  For Grosse Pointe, with our 8,400 students, this meant a mid year loss of $1.4 million.  To put this amount in perspective, our average cost per teacher is about $90,000 with benefits.  In order to make up this loss of income prior to our July 2010 year end so that we end up with a balanced budget, we would have to lay off 23 teachers by November 1!

Stab No. 2--the 20j Funding Cut
So, here we are in the hole $1.4 million, announced just hours before the State Treasury was to electronically deposit our School Aid money on Tuesday, October 20th.  In the process of signing the School Aid Fund bill, Governor Granholm decided to deal with $54 million of the budget deficit.  She did this by vetoing the distribution of an extra allowance call the "20j" funds.  A great summary of the history of the 20j funding was prepared by the State Fiscal Agency.  If you'd like to learn about it, click here.

Basically, Grosse Pointe and 50 or so other school districts have received this additional since the passing of Proposal A back in 1994.  Typically, the school systems that received this extra allowance were districts who spent a higher than average amount on educating their students when Proposal A was passed.  A great spreadsheet showing the school systems who received this funding and the totals by school system of this week's cuts was prepared by Birmingham School Board member Rob Lawrence.  If you'd like to see Rob's list, click here.

So again, here we are midway through our budget year, and just hours before the state Treasury was scheduled to electronically deposit money into our checking account, and Granholm decides to add to our midyear funding loss to the tune of $198 per student, or $1.63 million.  Putting the loss in perspective as I did for Stab No. 1, we would have to lay off an ADDITIONAL 27 teachers to balance our budget for the 2009-2010 school year!

After signing the bill with the $165 cut and the 20j veto, she issued a letter saying that the School Aid fund is "seriously underfunded" and the cuts to the 20j schools "will not fully resolve the shortfall." She ended her letter with, "While my approval of this budget will allow public schools to keep operating and school districts to continue making scheduled bond payments, the legislature has much more work to do to complete a balanced funding plan for our schools," she wrote. "There is no time to waste. The time to complete work on this School Aid Budget is now."

It was anticipated by the school funding and revenue pundits that sales tax income (the primary source of our school funding) will show a decline from the income budgeted, and that an additional cut of up to $165 may be issued in the form of a proration letter before the end of the year.

It turns out we didn't have to wait that long for the bad news--on to Stab No. 3 and Granholm's Thursday bombshell.

Stab No. 3--The Mid Year Proration
So there we were, just three days into the week and $3 million in the hole from the prior Thursday, and Governor Granholm dropped another bomb this past Thursday--a proration adjustment letter. A memo from Lansing explaining the reasons for the proration letter is available here.

In her proration adjustment letter, Granholm announced that she had received a letter from State Treasurer Robert Kleine advising her that due to declining revenues, there was a hole in the School Aid Fund budget just signed in the amount of $212 million.  In order to cure this deficit, she was advising schools systems around the State of an additional cut beyond the ones she has inflicted on Monday.  This shortfall is being vehemently denied by the Republican big wigs in Lansing.  Even so, she denied that the timing was politically motivated to squeeze more revenue out of the Legislature.

In her proration letter, she explained that the proration amount of $127 per student had to be announced now instead of waiting for a new revenue estimating conference in January because the "Legislature didn't send me a balanced budget." She also said the fiscal picture is just getting worse.

"We've never seen times like this in Michigan," Granholm said.  She added that the further we get into the school year, the harder and deeper the cuts have to be.  "The only thing worse than getting bad news is getting it when it's too late to correct it," Granholm said.

So what does this mean to Grosse Pointe?  New revenue must be appropriated by the Legislature and signed into law within 30 days or the proration letter will go into effect for our Dec. 20 School Aid Fund payment.

Back to my lay off analogy, $127 per student equates to an income loss for Grosse Pointe of $1.1 million, or an ADDITIONAL 18 teachers to balance our 2009-2010 budget.  Ouch!

The Bottom Line
The bottom line is that in one short week we have potentially lost $4.1 million in State funding, or about 4% of our total operating budget. 

Are we going to lay off 68 teachers tomorrow?  No.  We have programs in place, and students sitting in what some would say are already over crowded classrooms for the teaching methods we use today.  In addition, some of our classrooms aren't physically large enough to accommodate 40 students.  Even more basic, we have labor contracts in place that we can't change with the same speed that our funding was taken away from us this past week.

Where is the money going to come from to run our classrooms for the balance of the school year as they are staffed today?  There are only two places it can come from.  The first (and hopeful) solution is that the Legislature and the Governor both take a "time out", make up, agree that the future of our State rests in our schools and restore the cut funding.  In my opinion, there may be compromise, but we aren't getting all of it back.  That leads us to our second source of salvation--our fund equity.

Our school system fund equity is basically our savings account.  When I was on the School Board, it was pretty much agreed that our savings account would only be used for one time emergencies and not for ongoing funding of programs.  The unexpected hits we took this week certainly fall into the category of "one time emergency".  I believe the School Board will have no option but to fund a portion of this devastating blow from Lansing out of fund equity in order to get us through the 2009-2010 school year.

The budget for the 2010-2011 will surely have to reflect this loss of income, as we can't tap fund equity forever.  At $4.1 million per year, it would be gone in less than four years and the school system would be bankrupt.  With 85% of our costs coming from staffing, we don't have many places to cut the kind of overhead we will need to cut other than staffing costs and changing the way we teach our children to make more efficient use of our labor resources. 

This leaves the Board with the challenge of structuring the union contracts that are presently under negotiation and the methods in which we teach our children to reflect this loss of income.  We have to have the ability to deal with HUGE funding cuts in the future without draining our fund equity.  We have to adapt to these kind of structural funding changes from Lansing (which are only going to get worse) in the years to come without bankrupting our school system.  They will be tough options to swallow, but in my humble opinion, they are the only options we have.

Karl Kratz Appointed to GP School Board

Mr. Karl Kratz, a resident of the Shores, was appointed by the School Board in a 6-1 vote to serve as my replacement through December 31, 2009.  School board member John Steininger cast the dissenting vote.

Mr. Kratz formerly served on the Grosse Pointe Shores Village Council with school board member Fred Minturn.  He is also seeking the three year balance of my term in this November's election.  Mr. Kratz's only opponent for this board seat is long time GP realtor Cindy Pangborn of Grosse Pointe Woods.