Hamilton County: School system considers pay cuts to balance budget

Hamilton County: School system considers pay cuts to balance budget

January 7th, 2009 by Kelli Gauthier in Local Regional News

Public school employees may have to take a pay cut to help balance the district's budget, administrators told a citizen committee Tuesday.

All cost-saving measures are still on the table, said the school system's Chief Financial Officer Tommy Kranz, including across-the-board salary freezes and cuts.

"If we did a 5 percent across-the-board salary cut, it would save $10 million," he said. "And we're going to look at everything."

The $10 million potential savings would cut in half the school system's projected $20.2 million deficit.

Superintendent Jim Scales said he would be willing to freeze his salary or take a cut if it helped the school system stay afloat, but a decrease in his $200,000 salary wouldn't make much of a dent.

Decreasing all school system employees' salaries by 5 percent also is unlikely, he said, because of the significant negative impact it would have on employees at the lower end of the pay scale.

Salary changes were just one option presented Tuesday to about 30 community members selected by the school board to weigh in on the Hamilton County Schools' budget.

The "blue ribbon committee" has no voting power, but each board member and Dr. Scales selected two people to join the group, which serves as an extension of the board's Finance Committee.

At the meeting, Mr. Kranz gave the same budget presentation he has shown to the Hamilton County Commission and other elected officials, explaining how the district came to be $20.2 million in debt. With no revenue increase, the school system's expenses continue to grow, thanks in part to a large number of personnel, medical insurance costs and transportation increases.

One thing Mr. Kranz made clear was that the district no longer can afford to operate small schools, which surprised some committee members.

"The community does not understand that," said Irvin Overton, a member of the community committee.

Larry Buie, manager of Chattanooga Gas, said he sees his role on the committee as an ambassador to the rest of the community, explaining to others the severity of the budget deficit.

"It opened my eyes as far as the magnitude of the debt," he said. "I didn't have any idea how much."

Having the citizen group spread the word about the budget crisis might help take the heat off administrators when they must make tough decisions such as closing schools, laying off employees or cutting salaries, Dr. Scales said.

"These people are representative of the community, these are the people who are involved," he said. "When we make these decisions at least we'll have people who understand why we're making them."