In two weeks, Hamilton County's public school administrators will present a plan for digging out of the system's $20.2 million hole, which could include cutting jobs, freezing salaries, changing health insurance and closing schools.
Although the specifics will be outlined Feb. 17 at a Hamilton County Board of Education Finance Committee meeting, administrators on Tuesday gave several options they are considering to members of a citizen advisory panel.
"We'll come back with a recommendation, and we'd like to look beyond next year," Superintendent Jim Scales said. "Every year we go through this process, our staff is on pins and needles."
To add context to the school finance discussion Tuesday evening, David Eichenthal from the Ochs Center for Metropolitan Studies presented a report comparing per-pupil spending in Hamilton County to state and national figures. It also examined Hamilton County's lagging state and federal funding.
Mr. Eichenthal said both were "significant contributors to the overall problem" of the Hamilton County Schools' budget.
INSIDE THE CHANGES
The last thing Dr. Scales and Chief Financial Officer Tommy Kranz say they want to do is cut jobs, so the first part of the administrators' plan will include a $2 million reduction to central office operations and changes in salaries. Subject to negotiation with the Hamilton County Education Association, Mr. Kranz said he is considering freezing the yearly STEP salary increase, which would save $2.5 million.
Another option would be to make a 5 percent pay cut to all employees above the level of principal, saving the district about $750,000, Mr. Kranz said.
The district's biggest expense increase is the $5.2 million in projected health care costs, which Mr. Kranz said needed to be addressed. The school district might ask employees to start paying more than the 16.75 percent of their health care costs they pay now, or the system may join forces with the county or the state health care plans if Mr. Kranz determines that would be a savings. He also is working with Erlanger hospital to negotiate a discount for school system employees who are treated there, he said.
But some of the most-appealing aspects of the employee health care plan were offered to personnel in the 1980s in lieu of a raise, Mr. Kranz acknowledged. Still, as the district's employees age and health care costs continue to rise, the school system must address the expense, he said.
"Health care is the one area we've got to get under control. It's getting scary as to what it's costing us," he said.
School board member Rhonda Thurman said she doubted whether the salary or health care changes ever would be approved by education association members. More than 90 percent of school administrators are members of the union, which she suggested has more power than it should.
"That's why some of those things are on the table, but they're off the table. It's under the table," she said.
Changes to the current health care model likely would save the district no more than $3.5 million, so Mr. Kranz said it was inevitable that administrators would be forced to cut some jobs and potentially close schools.
Area superintendents now are working with principals around the county to determine what positions are necessary to each school's operation - information that will be factored into staffing models presented at the next meeting, Dr. Scales said.
CLOSINGS WOULD BE 'TOUGH'
As for school closings, administrators considered 19 schools for consolidation, five of which might be closed, saving the district $2.5 million.
Seven of the schools are being considered for consolidation into three new schools, and the remaining seven were "recommended for no action," Mr. Kranz said.
With more than half of the school board seats up for election in two years, Dr. Scales acknowledged that closing schools in certain districts could put some board members in a bind politically.
"It's gonna get tough. It becomes very emotional when you're talking about closing schools," he said. "This will get to be political."
Near the end of Tuesday's two-hour meeting, citizen advisory panel member Irvin Overton said he'd had enough talk, and that it was time to begin actually making decisions.
"I can do a lot of talking and 'blue sky-ing' here, but I find it difficult to do any more discussion without a model," he said. "You all gotta make up you all's minds."
Mr. Kranz said he would present a three-to-five-year plan at the next meeting that would consider the possibility of cutting more than the $20 million required merely to balance the budget. The school system's operational model must be changed, he said, to avoid a painful budget process every year.
"It ain't fair to our employees to go through this exercise every year. And without them, our children don't get educated," he said.