More decisions on jobs, programs loom at Keystone
Closing Dickey Elementary School.
A voter referendum to raise taxes beyond a state limit.
Those are three of the many unfavorable choices the Keystone Central School Board proposed to the public at Thursday night’s meetings in order to balance its burgeoning budget for 2018-2019.
Even with a board-approved preliminary $75 million budget, the district still faces a $7 million deficit, mostly because of skyrocketing pension costs.
That leaves few options other than making cuts, “if the district wants to avoid bankruptcy,” new board member Bo Miller said before a crowd of about 150 people in the Central Mountain High School auditorium.
On the table are perhaps 30 job cuts, not to mention program reductions.
“This budget is going to provide a lot of pain, and we better recognize that fact. Which side will bear the pain: The taxpayers or the students? Either way, there’s going to be a lot of pain,” said board member Wayne Koch, who participated in the meetings via phone.
Board members presented what community members consider an unpleasant choice: Close Dickey Elementary or take a two-year pay freeze.
“If we say we’re not gonna close Dickey, one of the things we’re looking at is a two-year pay freeze for all staff members in the district,” said board member Roger Elling. “Our costs are rising, but our income is not on a level plane … if we were to get a two-year pay freeze … it will get us to the point where bond issues will be resolved.”
The district’s yearly loan or bond payments on past building improvements are about $4.5 million.
John Compton, a certified public accountant with Baker Tilly LLC, which performed a 2016-2017 district audit, confirmed that the bond should be paid off in about four years, leaving the district essentially “debt free.”
Compton and his colleague Joe O’Neill also discussed how district contributions to the Pennsylvania Public School Employees’ Retirement System have negatively affected Keystone Central.
The state, in the past few years, has socked public school districts with increased and mandated pension contribution rates after having been lax about the situation, Compton said.
During the 2016-2017 school year, Keystone Central contributed $9.6 million to PSERS retirement and pensions.
In the next five years, that yearly cost will rise to $11.8 million.
To keep up, the district has been pulling its pension money from its general fund balance, which was, and is, relatively healthy.
But O’Neill said the district can no longer rely on that fund balance as heavily.
“You go two more years and the trend that you’ve been seeing, you will be down to the (fund balance or reserve) low range … and very quickly,” he said.
Business Manager Susan Blesh and Board President Charles Rosamilia confirmed that, with no additional cuts to the 2018-2019 preliminary budget, the district will still be $7 million over budget, thus nearly depleting the fund balance.
Closing Dickey Elementary would save the district $1.6 million, or $300,000 over the next five years, it’s estimated.
Most of the savings would be from cutting teaching positions, said Blesh.
Many audience members were unhappy that the board is considering hiring staff in other departments, like Career and Technical Education, while simultaneously considering putting Dickey on the chopping block.
Some people asked how the district would fit students from Dickey into the other elementary schools, which are nearly at capacity.
Rosamilia said the board would have to come up with a redistricting plan, but did not offer specifics.
Board member Tracy Smith said a plan should have already been presented on how students would be disbursed, considering how much the board has talked about closing Dickey.
“I’m respectfully asking for a plan before we continue with that,” she said to applause from community members sitting in the back of the auditorium.
“In order to put together a feasibility study and a redistricting plan … is there enough time to have that on the table for this particular budget year?” asked Miller.
Rosamilia said the board would have to start the process this month if it wanted to have a plan in place.
He said there would have to be a decision on closing Dickey “within the month.”
Alternatively, a districtwide pay freeze would save the district around $1.2 million.
Rosamilia said the district is still negotiating with three unions–teachers, support staff and secretaries–over the pay freeze, and so did not want to provide more information.
If the three unions accept a pay freeze, instructional and non-instructional administrators also would be included.
He also said the board would consider putting a tax referendum question on the ballot in May for voters to decide.
“We could raise taxes five or six mills,” he offered as an estimate to what kind of revenue would be needed to fill the gap between budget expenses and revenues.
But many community members were unhappy with that.
Heather Haigh said she would not vote for a tax increase because, while it might mean less cuts, she didn’t know if it would help the board spend more wisely.
Over the course of the night, community members raised many concerns over the 23 cuts (and counting) and possible budget additions the board had not included in the preliminary 2018-2019 budget.
None of those items have been formally voted on, but some of the more impassioned discussions centered around the CTE program, athletic department reductions, the curtailment of the library program, the elimination of Pre-K, the curtailment of elementary enrichment and IST and the increase in elementary class sizes, in some cases to form multi-age classrooms.