| Detroit Free Press; 11/20/06 | |
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| Tweet Topic Started: Nov 20 2006, 07:00 AM (108 Views) | |
| NFarquharson | Nov 20 2006, 07:00 AM Post #1 |
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http://www.freep.com/apps/pbcs.dll/article.../611200392/1008 Published: November 20. 2006 3:00AM Michigan Strapped schools give Proposal 5 wistful look November 20, 2006 BY PEGGY WALSH-SARNECKI and LORI HIGGINS FREE PRESS EDUCATION WRITERS What the cure might have cost Proposal 5 sought to lock in inflationary increases for education spending and transfer much of the burden for school employees' retirement to the state. The amount of money the proposal would have added to the $15 billion the state spends on education was the major point under debate. Supporters said the added cost would be $565 million the first year. The Citizens Research Council of Michigan estimated the cost at $565 million to $707 million. The Michigan Chamber of Commerce and the Michigan Association of Realtors, which opposed the proposal, put the first-year cost at $766 million. This year, Utica Community Schools trimmed textbook spending and cut 40 teaching positions. Plymouth-Canton Community Schools added 25 cents to the price of elementary school lunches and students are paying more for field trips. Students in Huron Valley Schools are paying more to play sports. The districts are struggling with the same problems as businesses: spiraling retirement and health care costs. Schools can charge a little more for lunch or create fees for some activities, but they cannot raise prices enough to balance their budgets. They can only cut their expenses. Proposal 5, which guaranteed funding increases tied to the rate of inflation, was the school officials' solution. But voters said no to it overwhelmingly Nov. 7. The question now is whether Lansing lawmakers can come up with any better ideas to help schools. "We go back to the drawing board as we deal with rising health care and retirement costs," Jim Ryan, superintendent in Plymouth-Canton, said Nov. 9. His district cut $7 million from budgets in the last five years. "We're just trying to survive and stay at the same quality of education we have," Ryan said. The fallout from Proposal 5's defeat may be overshadowed by more immediate budget problems. The Senate Fiscal Agency reported state revenues from taxes are down from last year's levels. Tom White, executive director of the association of Michigan School Business Officials, alerted his members -- many of whom are school superintendents and school finance directors -- to brace themselves for a midyear funding cut as high as $150 to $160 per pupil. State officials say belt-tightening could reduce the projected $173-million state deficit, including a $120-million deficit in the school aid fund. But White isn't sold and told his members that the school aid deficit alone could easily grow to $240 million next year -- in large part because initially the state planned to carry money over from this year. "We have a problem. A big one. And we don't have Lansing's attention yet. My concern is we're going to have to have more districts go over that cliff" to get that attention, White said last week. "They need to sit down and address this." School officials are getting parents' attention, however. Amy Drean, mother of two children enrolled in the West Bloomfield School District, is worried the Legislature won't make school funding a priority. One of her school district's cost-saving moves this year was to reduce middle school instruction from seven periods to six. That effectively decreases the number of classes that can be offered throughout the school year. "The schools have cut all they can cut," she said. Carol Summers echoed her thoughts. Summers' 5-year-old grandson attends Detroit Public Schools. "I do believe the state should assist with funding for public education, and I do believe that we have to have a strategic plan in place to look at how money is spent and how costs can be cut," Summers said Thursday. "But do not affect the children." No one in Lansing is talking about a long-term change in school funding. But both parties have their own ideas for how to help schools this year. Ari Adler, spokesman for Sen. Ken Sikkema, R-Wyoming, the Senate majority leader, said Republicans will start by trying to pass a bill during the lame-duck session that would make it easier for school districts to seek bids on health insurance. This would save an estimated $570 million over the first three years, Adler added. The bill passed in the Senate and is awaiting approval in the House. "The foundation grant has been going up every year, but just about every penny of it is going to health insurance and pension costs," he said, referring to the state and local money school districts are allocated for each student. "We can keep raising the per-pupil allowance very year, but if it's not getting into the classroom, it's not doing what it was intended." Though state funding has gone up the last two years, districts received no increase the previous two years. But Democrats will resist any plan that comes up before newly elected legislators are seated, said House Democratic Leader Dianne Byrum, D-Onondaga. "Doing this in a lame-duck session would end up a partisan vote," Byrum said. Recent changes gave schools more choices in health insurance, and made the cost savings of the Republicans' plan doubtful, she said. "It should not be a last-minute, piecemeal approach to a very serious public policy. Any kind of approach dealing with school funding is going to have to be bipartisan," Byrum said. Expect resistance from powerful groups such as the Michigan Education Association, the state's largest teachers union. "We believe that collective bargaining and the market are working," said Bill Fralick, director of communications for the Michigan Education Special Services Association. The MEA affiliate runs the health insurance program of choice for 51% of the school districts in Michigan. "MESSA's rate of increase for the current year is under 5%. That's about half the national average," Fralick said. Iris Salters, president of the MEA, said health care costs are increasing for all state employees, and across the nation. "This is something that needs to be dealt with as a state and as a nation, not just put on any one employee group," she said. While health care is something districts can bargain, they have no control over retirement costs. The state sets the retirement rate, and schools must live with it. Today nearly 18% of school payrolls goes toward retirement. Those increased retirement costs, White said, ate one-third of the $210-per-pupil increase school districts got for the current school year. There have been discussions in Lansing about retirement changes, such as rethinking how new teachers are vested, Byrum said. The issue could come up during the coming session. But exactly what such a bill might say remains to be seen. Educators, for their part, haven't given up on some form of guaranteed increase. The Legislature needs to figure out a way to give schools more money to offset inflation, something Proposal 5 would have guaranteed, said Jackie Johnston, superintendent of Huron Valley Schools. "Unless you want school districts to cut back on what they're doing, the answer is to give us the dollars to cover the inflationary increases," Johnston said. "We have gone through years and years of cuts. We've cut lots of programs. I genuinely believe our community doesn't want to do that any more." Contact PEGGY WALSH-SARNECKI at 586-469-4681 or pwalsh@freepress.com. |
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| NFarquharson | Nov 20 2006, 07:02 AM Post #2 |
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http://www.freep.com/apps/pbcs.dll/article.../611200307/1068 Published: November 20. 2006 3:00AM Local columnists LOCAL COMMENT | SCHOOL FUNDING: A smarter way to budget schools November 20, 2006 BY MIKE RENO Mike Reno The debate over Proposal 06-5 on the Nov. 7 ballot should have helped the public appreciate the fact that schools are not suffering from a lack of money. The real crisis is that not enough of money is reaching the classroom. The defeat of the proposal does not eliminate the crisis. So now, while it's still fresh in the public mind, Gov. Jennifer Granholm has a unique and timely opportunity to work with new House Speaker Andy Dillon and new Senate Majority Leader Mike Bishop to enact meaningful education finance reform. A key component must be health insurance for educators, the costs of which threaten to financially destroy our school systems. The magnitude of the problem can be seen in an annual survey by McGraw-Wentworth, a group benefits consulting firm. The report spotlights efforts to keep health care affordable. It shows that most workers share in the cost of their health care by paying part of the premium, and through co-pays and deductibles. But it also shows new trends, such as incentives for employees to make wise choices about their own health, and to become more informed consumers when seeking medical treatment. Compare this to a plan in which the insured employee -- and members of the employee's family -- pay absolutely nothing for health insurance. The co-pays and deductibles are minimal. Anything and everything is covered, at nearly any doctor's office, as are dental and vision care, and brand name prescription drugs. There's nothing to encourage healthy lifestyles. There's nothing that would discourage a barrage of needless medical tests. The employee has absolutely no reason to make an effort to control costs. This is not some extreme example created for presentation purposes; these are the actual taxpayer-funded benefits offered to many Michigan school employees. In many districts, health insurance costs equal $1,700 per pupil and, statewide, may total $2.9 billion a year. The financial crisis facing schools today, which leads to teacher layoffs and increased class size, is largely caused by these health care costs. Something needs to be done to keep benefits affordable and available, while making sure we keep our valued educators healthy and protected. Some school boards have taken small, token steps to address the problem. A few have tried to make meaningful changes, only to find themselves crushed by the Michigan Education Association, the state's largest teachers union. It's time for the state to intervene, but in a way that will still allow local control, without letting things stay "out of control." State funding at the low end is $7,085 per pupil. This amount could be split into two pieces: an education grant of $5,385 per pupil, and a benefit grant of $1,700. All districts would receive the same benefit grant, but those that currently receive more per pupil would see a proportionately higher education grant. Schools would be required to limit their health care expenses to the amount of the benefit grant, which would be adjusted annually by the Legislature. The adjustment would presumably be somewhere closer to the rate of inflation, rather than the 11% schools have been allowing. This would drive meaningful reform. School boards and unions would have to negotiate benefits within a budget. Together, they could choose to make reasonable changes, or boards could outsource support services to allow more benefit dollars for teachers. This would all be governed by local control. And, most important, the annual increase in the education grant would have a better chance of making its way to the classroom. The public is focused on this topic, the need for reform is clear. There may never be a better opportunity to improve the long-term financial health of our education system. MIKE RENO is an elected trustee of the Rochester Community Schools and president of a software manufacturing firm in Troy. You can write him at reno@rcs-reno.com. |
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