Tuesday, April 22, 2008

Cash Management and Sales

The following dialog took place at the end of a very long string of comments on a prior post. I felt it important enough to highlight as its own post:

Chris said:

I think you need to understand that no one wants to have the children suffer, but the thoughts are that we can just keep throwing money at the problem. Yes, we may need to pass the levy, but is that the only thing we can do? The concern really is that no one trusts the school board here, and I think that stems from the fact that they keep coming to the community with their hand out simply expecting that they're entitled to an increase without due diligence on their part. And maybe that due diligence is truely there, but it's behind closed doors so that we, the very people their asking more money from, aren't privey to these behind doors conversations.

In fact, I spoke with several teachers recently and have been enlightened a little on the situation with their medical and contract negotiations. There's real problems here.

So you pay a $1000 for your son to play football. That's for what 4 years? The alternative is that you pay increased taxes of $800 for the next 20 years or until you decide to move. That's a savings of $12,000. Yes, I'm being a little cavalier here, but what we're saying is that before we decide to give them another chunk of money have we truely trimmed all the fat (and I'm not saying people or insurance is fat) from the expenses?

As the head of a household I constantly have to look at where and how my money is being spent. It's only prudent to do so. It's when I get lazy and coast for awhile that my expenses go to crap and then I look at my check book and say, "Dang, where did I spend all that money?" That's what we're asking the board to do, and here's the critical component, share all the information with us, not just the fact that they think they've got a money situtation.

Did you remember that the school board reported an estimated $15million overage last fall? That rainy day fund is still there just in case, but hasn't been spoken about because the board doesn't want to remind anyone. Get my point?

The teachers are mad because they're working without a contract. The biggest outlay of the budget is related to them, and the point of contention is around the medical insurance. Are you aware that they have been changing insurance companies yearly (just like my company does) all in the interest of seeing which company is cheapest. Yes that's an unforunately, pain-in-the-butt reality of medical insurance, but has anyone considered other options. Currently they're looking at a 27% increase in their medical (I went 32% nearly 5 years ago). How about giving them options such as an HSA. Those that are healthy will migrate towards the HSA because it's a good deal for them. Those that use the insurance heavily will pay higher premiums. That's the way it works in the private sector.

My response:


Thanks for your comment - well said.

On your point about the $15 million overage:

What you are seeing the balance of the General Fund - the amount of money in the bank. It's not a rainly day fund like a savings account, but rather the active checking account where income is deposited and from which checks for expenses are written.

The way levy funding works is that on the first years of a new levy, the tax revenue is greater than the operating expenses, and the balance of the checking account (general fund) increases. Then in subsequent years, the spending catches up with the revenue, and eventually surpasses it. When that happens, the general fund balance starts going down. The trick is to not let the account run dry.

The Income minus Expenses for last year was $5.8 million (seen on line 6.010), meaning the general fund would be increased by that amount. Indeed if you look at the last line of forecast in the column for FY06, you'll see $9.4 million. Adding the $5.8 million surplus for FY07 causes the General Fund to grow to $15.4 million.

But look at FY07. Line 6.010, Excess of Revenue over Expenses is a negative $4.5 million. We have hit that crossover point. The projected balance of the general fund at the end of this year is $10.9 million.

The real problem is next year. Revenue minus Expenses is $14.5 million (nearly 3 times what it will be this year). This spending deficit sucks up all the money in the general fund and still falls $3.6 million short.

That's the reason for the $4.5 million in cuts going on right now.

So while it may be common practice for a School Board to allow spending to go from generating a surplus to running a deficit, that's okay as long they manage the balance of the general fund. But our School Board felt it was more important to be able to say they "stretched the levy for four years" than it was to make sure we had enough money in the checking account (note that it was an election year for Board members...)

And so they have taken us right to the brink of disaster. A school district cannot deficit spend, so when the levy failed, they had to take the $4.5 million out of the budget to keep from bouncing checks.

I've been in business a long time. Protecting your cash is one of the top 2-3 things a business owner must do. Just ask the folks at Skybus. When they ran out of cash - they were done.

While the members of our Board are good people, none of them are business owners or business executives (until Dave Lundregan was elected). They have no experience with the harsh reality of cash management, especially not in a $150 million enterprise. They simply think the money is due them because, after all, it's our school system we're talking about.

That's because they don't understand the 'sales' part of their job (one of the other 2-3 most important things). As long as it is true that the people of the community have a choice in how well to fund our schools, there is a need for the school leadership to build and maintain a relationship of trust with the people who exercise that choice. In my experience, that requires a long and sustained commitment to communicate, educate, and listen.

But our Board doesn't understand the need, nor know how to pull it off. That's the reason they support the Getting It Right For Ohio's Future amendment - because it relieves them of that burden.

And it takes away our choice.


  1. Chris pretty much nailed it!

    I'm torn many days on this issue. Ultimately, I realize we have to pass a levy. If it's now or in 2 years, it's likely going to be the same size. The reality is that costs will go up (perhaps more slowly now that more people are watching and voices are being cast), but in the end we have to pay.

    So, that part of me says "vote for the levy, spare the pain of the kids/parents/teachers, and fix the issue over the next 3 years before the next levy is required".

    The other voice in my head (there are several and it's a scary place - :-)) says that a message needs to be sent and a hard line drawn. BUT.... what is it we really want? When will we know it's been achieved? Better communication? OK, we can agree on that. Spending cuts? How much do we want? What is the threshold that once reached gets the public back to voting for levies? We are all right in that the BOE has to have that conversation with the public to learn what the contributing factors are and to compromise such that common solution can be achieved. But I don't know how to do that. Voting down this levy will make deep and dark cuts. Too severe for this community and school district. However, I see every one's point about not giving a blank check without some level of accountability.

    It's a wicked web. I can argue both sides, really. But in the end, I come down to avoiding disaster by passing the levy and continuing to demand accountability from the district to remedy (as best we can) the problem.

    That's why I come down on the side of PRO levy. But at the same time, I am taking steps to become involved in the process so that I can be a part of the movement to find that common solution. Voting no and walking away won't solve anything. It just makes the schools weaker. But, voting and PARTICIPATING toward a common solution is the only real answer we have.

    So I hope each of us get a little more involved (and not just at voting time, but continuously) and help identify what is "acceptable" to the public AND the schools. In a perfect world, both sides would have a number and work a plan to find that common ground. But when we have a undefined goal (other than "sending a message"), we will never achieve anything positive. We will only dilute this district's capabilities.

    We need to collectively define the goal, identify the challenges, and work together to address those challenges. Right now, we are three different ships rowing in opposite directions. We have to figure out a way to row in the same direction, but in a way that doesn't sink one or more of the ships.

  2. I agree with some of KJs points.

    One thing that would be a HUGE help would be for the district to set up meetings that were not just big levy pep rallys with a 15 minute Q&A session thrown in. I went to one of the informational meetings and was very disappointed. Any questions hinting that the levy was not the "right choice" or that the district may have too much fat were met with a tone of underlying annoyance from the board when they responded. Very unprofessional. Any question in my mind as to how I was going to vote was settled that night. I guess they forgot ultimately I as a taxpayer was their "customer".

    The BOE needs to get on the stick with these meetings if they help to resurrect support for this levy.

    Many I know are LESS likely to support the next levy given what has come out in the last few months (19 psychologists on staff, admin raises, etc.) I would think that given that the BOA would be doubling their efforts to reach out and explain / justify their position. Other than this blog and Paul's articles, I feel there has been little other useful information shared.

  3. A lot of accurate analysis here.

    A point that can't be overstated is that if 80-90% of spending is personnel costs, you have to control personnel costs to reduce levy demands. (I don't think this is an opinion, it is a simple fact.)

    This is done in one of two ways: By reducing personnel OR by reducing the salary and benefit costs for personnel.

    Reducing personnel negatively impact the students (in many cases).

    Reducing salary and benefit costs negatively impacts the adults (staff).

    Observation: 96% of the adults (teachers) recently rejected a compensation pkg that many/most in the community would personally consider VERY generous.

    In my opinion, unless the union and its members agree to become a part of the solution to the rapid cost escalation, this problem will not go away.

    Question: Without the union and its members significantly changing their compensation demands, how will the growth in the budget be reduced to a level the community can support?

    My answer..."I don't know."

  4. KH:

    If it were the growth in salary and benefits costs alone that the community has to deal with, these numbers would not be so extreme and the incremental levies would not have to be so large.

    The problem is the double-whammy created by the increase in the number of employees - a 56% rise in the last decade compared to a 34% increase in student enrollment.

    We've had zero explanation from the school leadership as to why this is the case. I suspect that they don't know, and might not have even realized this before I pointed it out. They're just not folks who have the skills of management - notably financial skills (except Dave Lundregan).

    That's why we need to think more about the folks who get elected to the Board in Nov 09. The Sarbanes-Oxley Act (written in response to the Enron/Worldcom/etc scandals) requires the Boards of public corporations to have at least one person qualified to be called a 'financial expert' so the Board has the capacity to understand both the obvious and less-obvious elements of the company's financial situation.

    Our school district has become a good sized enterprise, with an annual budget headed towards $200 million. We need to have at least a couple of folks on the Board who know how to control organizations of that scope and not get overwhelmed by the numbers.

    That's why I ran for the BOE last time. I have that education, training and experience, including having served on the Board of Directors of public corporations. But I am most certainly not the only person in Hilliard with those qualifications. It would be great if others stepped forward and ran.

    We need to be more deliberate in putting people on the Board who have the right mixture of skills, and financial is only one of them. Yes, it's appropriate to have at least one 'average parent' on the Board, whatever that is in a community as diverse as ours. But there should also be an expert in education, an expert in finance, and a lawyer.

    Perhaps a goal for this grassroots effort we talk about should be to recruit a slate of folks to run next time.


  5. Paul, I will agree that a financial background is important.
    I also think you need someone, and it does not have to be a lawyer
    etc who is willing to stand up and ask tough questions

    The problem with the board in hindsight now, is you have the same tied in group, supported by the same influential groups. Mayor, city council, HEA. etc
    It is nice that people have volunteered and spent significant time in the district volunteering.
    However, because of the friendships
    are they willing to ask the tough question. My opinion is no.

    I think an organized group to run
    would be a good idea, Saves on some costs, can combine flyers etc
    yard signs.

    I think many are torn about new funds, but the issue that is getting worse is that more and more people are starting to find out that with the tough economy they,as noted by previous posts,
    that the staff is enjoying a pretty nice deal, lots of time off

    The note about rejection of the contract is noteable. Was that however based on real feelings of the teachers or the HEA leadership
    basically telling them how to vote or else.

    I believe the current contract being offered continues the 7 + % raises. With some changes to the medical. This is still a good deal

    My new plan costs for an individual
    at work over 200.00 plus co pays
    and a fairly high deductible.
    Our raises for all co. employees
    will be 2% and for managers the extra money earned will not come from merit increases but by having to achieve EVERY goal to make bonus

    The best way to insure the levy passes is for a new contract to be signed with limited increases
    and much less than being offered

    Come November the NO SALE sign will be sent again if compensation
    goes up 4 to 7%

  6. The new HEA contract will have lower raises and will call for a percentage of medical premiums paid by the HEA staff.

    the rejection was not based on the raises or the fact that medical premiums need to be paid. There was language in the contract offer (that never gets talked about) that made this offer less than favorable. Also, it was the blind amount of premiums that was a sticking point. I agree, we all have "blind" premiums so that probably isn't a great argument on the HEA's side, but it should be noted that the rejection of the contract offer had less to do with finances than it did other language.

    Focus then turned to the levy and negotiations were put on hold. If not for the election, I think this would have been settled by now.

    I know as a fact that the teacher's union submitted their counter-offer recently and the board has yet to respond. However, that counter-offer included less than 3% raises and a percentage of premiums to be paid. It also included a no reprisal clause that was initially rejected by the board, and additional language that relates to non-financial points in the contract. It's actually a little less, financially, than the board offered as its last proposal, but includes the language the HEA wants related to reprisals and other non-financial items.

    I just thought some needed to hear that it's not like the HEA are leading blind sheep nor is it like the contract talks have stalled only on money issues. In fact, the money issues are the lesser of the two.

  7. Scoop:

    Thanks for the info.

    Do you what the contract term is in the HEA's latest offer? They had wanted one or two years, which is what you would ask for if you're making concessions but believe the economic climate is going to improve soon.

    I think the BOE, and probably most in the community, would prefer a longer term just so we don't have to go through this drill again any time soon.


  8. I can't recall anyone ever running for the school board who ran on the platform of watching out for the taxpayers. I DO recall someone running who was in favor of adding on to the two existing high schools rather than build a third school; as soon as she was elected she caved in to the incumbents and came out in favor of the third high school. That is when I totally lost any respect for the Hilliard School Board. Did the board ever go to the city and say "slow down the residential development"? Did they ever consider how 7% raises (including the steps) and fully funded health benefits would some day catch up to them (and us!)? Did they ever require the administrators who work outside of the school buildings to justify their positions? No, they sat on their duffs in executive sessions and discussed god knows what. The board is the management arm of the enterprise and they have failed miserably; and they continue to fail since I have not heard one peep from them since the failure of the levy other than to say the kids will suffer. I see that the Olentangy district has a new board member who is watching out for the people; the fact that an outgoing superintendent referred to her as a "rogue" really tickled my fancy. We need one of those "rogue" types on our Board.

  9. Paul - the term was three years - the teachers GAVE everything Scoop said and the Board turned it down! Things will heat up now, stay tuned.

  10. Honestly Paul, I am not sure what the proposed duration was for the latest offer. I don't want to speculate as it would only be rumor.

    Be certain that this will all be completed prior to May 30.

  11. ABM: Thanks for the info.

    Hillirdite: Actually I ran last Nov on exactly that platform, but came in last place. I simply underestimated how many people I would need to reach directly during the campaign, and how much clout the HEA endorsement would carry.

    The person you are talking about was Cheryl Ryan, who ran jointly with Johnny Scales. I gave her and Mr. Scales a briefing on school funding during their campaign, but they chose not to raise the development point. I was disappointed that Ms. Ryan was elected, but Mr. Scales was not even though their platforms were identical. I have my suspicions why, and it doesn't speak well for our community. You're right, she changed her position on the high schools immediately after being elected. Then she resigned because she was offered a job at the Ohio School Boards Association.

    There are three BOE seats up for grabs in the Nov 09 election. A slate of new candidates would, if elected, hold a majority on the BOE. A slate of three running as a team would be able to pool resources, as an earlier commenter said.

    I'm no politician, and won't try to talk like I'm an expert at this stuff, but it seems worth a try.

  12. When did the BOE turn down the offer? Are they expected to provide a counter offer or was it just a flat "no"?

  13. Paul,
    I voted for you, I voted for no incumbents. I hope you will consider running again, especially if you can team up with similar thinking individuals. I voted for both Cheryl Ryan and Johnny Scales based on their platform of expanding the existing high schools. I felt completely duped and betrayed when Ms Ryan "flipped" immediately after joining the board. Uncanny.

    I have a question about state school funding and permanent levies. Once there is a state solution, will district-by-district levies be phased out even if they are called "permanent"? If not, and a state funding solution is coming soon, why lock ourselves into another permanent levy now? Why not wait and see what the solution is, especially if it raises funds from increase sales tax or income tax? Once there is a state solution, will there be no more district by district levies?

  14. Thanks very much for your vote. Barring something unforeseen, it is my intention to run again in 2009, and I hope several other new faces will be candidates as well. There's been too much imbreeding in our community leadership over the years.

    You ask a very good question regarding what happens to permanent levies which had been enacted prior to some potential new funding scheme. I felt it merited its own discussion.

  15. The Board rejected the latest contract proposal by the HEA on Wednesday evening. As for Paul's question, members of the HEA will be informed as to whether or not there was a counter offer made sometime during the next week. I can tell you as a member of the HEA that we have been the ones to GIVE during these negotiations and we are all at a loss to explain when and why a mutual and respectful rapport between the HEA and our school administrators and Board of Education went to hell in a handbasket, which is where we are now. To the blogger who questioned whether the HEA votes of their own accord or whether we are forced to vote in a certain manner by our HEA representation, I can state for the record that we are not coerced in any way. To "scoop", there is NO WAY that this all will be over by May 30!

  16. To anon.6:15

    Interesting,but all of this negotiation is on such a secret basis, that the public finds out only after the contract is signed.

    We have little idea except trying to translate bits and pieces and trying tokeep rumors seperate from fact.

    To your point on how the relationship broke down, I would remind everyone to examine exactly whom you voted for including the HEA and the teachers. The current board has had the support of the HEA, local political party etc.
    YOUR state senator whom the HEA
    supported refused to commit to anymore unfunded mandates

    Apparently someof the contract language regarding non economic
    terms has sticking points. Also the medical cap ? not sure who has that anymore is at issue possibly.
    Raises limited possibly to
    3% regular PLUS the step equal
    somewhere between a total of 6 to 7% possibly. These are only
    bits and pieces and not necessarily
    absolutely true, but unfortunatly
    the public doesnt really know.

    If the contract settles(which it will) for excessive raises, and
    benefits given the economy the
    levy will go down in flames and rightly so for the arrogance shown
    toward the public. After all
    we just saw new extended admin contracts at 4%

    I respect many here who believe in the true status of the upcoming levy, scoop, KJ< Chris etc and Paul has provided a great forum

    As a manager sometimes you have to make tough decisions. It is time to hold the fort, if we are on a freeze in funding, then we cannot affort what we have given out before

    This has become not about the kids
    but about someones raise, time off
    benefits, and top notch medical
    benefits. I fear that the district and their staff have lost touch
    with what has happenend in the
    workplace and private marketplace
    with some sort of entitlement mentallity.

    By the way, graduation rate based on 3 years as noted down 1.5%
    In the marketplace, when you dont make your goal or go backwards no matter what the reason, economy
    business closings, etc. You get
    shown the door,!

  17. I agree now.... this will not be setteled by May 30.

    The HEA gave in on everything. 1.5% raise, 6/8/10% premiums, 3 year contract and it was STILL turned down by the BOE. With no reason stated.

    So, here we are. Bad blood all the way around! The taxpayers are mad, the HEA is dejected, and the BOE is just arrogant.

    My feeling now is that the Board will hold off and institute the contract in the summer (as they have the right to do). That means the BOE can impose a contract on the HEA. That will result in a strike vote by the HEA. If 80% of the HEA membership vote for a strike, then we will start the 2008/2009 school year with a work stoppage. If a strike vote does not receive 80%, then the HEA will have to accept the BOE's contract.

    Bottomline, is that the BOE has drawn a line and has not moved an inch, while the HEA has moved toward the center AND BEYOND. They are going to force the HEA to vote for strike. Their assumption is that either 80% won't vote for a strike OR that if they do, it will be a political win for the BOE as the HEA would now be the "bad guys".... Striking at all, especially during football season, will put a lot of heat on all sides to settle this thing.

    Anon is right, this is going to get ugly. What else can the HEA do? I'm not a union backer in the least, but in this case, the arrogance of the BOE (to the public and to their staff (HEA)) has caused for a bad situation.

    Let's see... 4% raises for administrators, bonuses for administrators, AND incentive compensation for good OAT scores (assuming they are met) for administrators. Not for teachers, who actually do the work, but for administrators. That's ridiculous!

    Most on this blog are calling for performance pay. And I can agree. However, when the district has been run into the ground financially, and when we have a labor dispute of this magnitude on our hands, AND a failed levy causing $4.5M in cuts.... HOW IN THE WORLD CAN THE ADMINISTRATION GET PERFORMANCE PAY???? Especially since it's the teacher's performance that the pay is based on!!!! Teachers can't get rewarded or held accountable for test scores... but somehow administrators can lose levies, overspend, underperform, and completely ignore the public and get rewarded???? Something is wrong!!!

    I can not wait for the 2009 election. I will be voting against every incumbent.... and I will be calling for Dale McVey's job. How can he not be held accountable for this mess? Doesn't it start at the top? We always talk about the private sector and "reality". Well, if Dale McVey were running a $200M private organization his performance would certainly be cause for a RIF of his own.


  18. To Anon: You have posted a very ACCURATE and honest account of the state of present affairs. Thank you for being so forthright and posting what the public needs to hear. After all, we as member of the HEA have remained quiet thus far, so as not to rock the boat with negotiations. I think that is all going to change in light of the most recent rejection of our proposal. The community deserves to hear more than just the inaccuracies reported by the BOE.

  19. I was very surprised when I heard the last HEA proposal was turned down. I agree that this is going to get ugly now. There will be no winners and the landscape of Hilliard City Schools and this community may be forever changed. Some for good, most for bad.

    Paul, have you ever looked at the 5-year forecast assuming the HEA reduces raises and payes 6 to 10% of premiums? I wonder what that alone does to the forecasted budget. How much would we actually have to cut the next 3 years (in addition to the 4.5M already planned and the net savings from a new HEA contract).

    The reason I ask is that I wonder how many teaching positions can really be cut next year given that the state maximum for students per classroom teacher is 30. With the current cuts, class sizes will be in the 25-27 students (not sure on the average, I'm sure it's lower considering HS has some small classes).

    My point being, next years cuts may have to be cut somewhere other than classroom teachers. Plenty of intervention and ELL to go, but that won't add up to $14M. So, the cuts will most certainly include some DEEP cuts in programs and likely result in very high fees for parents.

    Do you have enough information to perform such an analysis?

  20. Some good information and thank you to the posters. I am a little suprised that information is leaking out as in the past the HEA and the Board have kept everything completely quiet until settlement.

    The community will not take kindly to a strike, it will damage the relationship even further, no matter who is in the right or wrong.
    The economy is the wild card and has not been faced in awhile.
    I wonder also what non economic
    proposals are really in there that truly may be holding things up

    I was hoping to go to the board to
    ask for an update tommorrow,
    however I have a school function with my daughter, so will possibly try and catch on later. I am sure someone will use the public time to ask for an update.

    The critical crossroad is coming
    for sure. The new legislation
    proposed as Paul has provided some great information for everyone
    will not fly. The auto increases will send this back to business as usual.

    We have had poor selection opportunities, and unfortuntly
    it takes big money to get elected
    to the board, council, state rep
    etc. The best we can hope for is a more educated public, and for enough of the worthless ones to be exposed at election time

    Our current choices for congress
    are shaky at best is a great example. As much a D. Pryce got caught being way too instep with
    the admin which cost her, she is still a way better choice than her parties replacement, who is not
    a legitimate choice, and his opponent not much better.

    Hopefully the board speaks to
    all of this Mon evening, but I am not going to bank on it !

  21. KJ - come to some of Hilliard's schools. We already have more than 30 students (sometimes up to 35) in each room. Where are you getting information that it is a state law requiring less than 30 students in a room?

  22. Honestly, I thought schools were limited to a maximum class size of 30 (primary education). But I have no basis other than that is what I thought was correct.

    Goes to show you shouldn't assume without having a basis.

    So, we could have 60 elementary kids per class if we so chose? Of course that is a ridiculous number, but my point is that there is certainly a limit that is reasonable for class room size.

    ODE, HEA, or OEA have no guidelines for this? Wow! What is a reasonable number (as the HEA contract calls for) that the BOE should aspire to?

    I'd still be very interested in understanding the impact of the current cuts and a "reasonable" HEA contract on the current 5-year forecast.

  23. Scoop, I'm sorry but I am not buying that 1.55% raise figure which the HEA offered. We all know there are step increases and as far as I am concerned, the failure of anyone to address that 4% is a major reason the levy failed. To me it is a glaring example of the lack of communication, and I actually feel like using stronger language but with respect to Paul and his readers, I will refrain from the initials I am thinking of. I will agree that the BOE SHOULD have indicated why they rejected the offer, and I totally fail to understand how they "negotiate" when they don't give any reason for the rejection. I suppose it might be that they DID say their last offer was the FINAL offer? If so, it appears they are sticking to their guns and things are about to get ugly(er).

  24. I am not 100% if that includes a step or not. I do know that the raise in the HEA offer was 1.5%. Or at least it was suppose to be.

    Any teachers want to comment?

  25. You can, of course, decide whether or not you "buy" the raise figure, but please understand that step increases are common in EVERY public school district I know of...so it's not like you are going to get rid of those in Hilliard alone and still keep good teachers. You are welcome to oppose step increases on philosophical grounds, but please realize they are part of a much broader context and not something Hilliard invented! And you might wonder why so many young teachers still leave the profession (some estimates are close to 50% within the first five years) despite the step increases and benefits?

  26. I am interested to learn where you all are getting your information, such as "1.5%" raise requests, etc. I think it is all based on rumor and heresay. Members of the HEA have not even been informed yet about what the last HEA offer was, why it was rejected and whether or not a counter offer was made by the Board. There is a general membership meeting to discuss all details tomorrow afternoon. I would be glad to share accurate information afterward.

  27. The BOE and HEA have reached a tentative agreement.

    Membership meeting today at 4PM. I'm sure details will come out at that time.

    This is good news!

  28. Now, there is a pleasant surprise!!

    I heard this was the case, but my contact didn't have any information.

    Now, all we need to do is get a levy passed and then we can get to work on solving the core issues of this district

  29. I believe that everyone knows that
    step increases were not just for the
    Hilliard School District.

    So that we dont get confused even though I think it is the prevalent
    attitude is that people dont have an issue with step raises or regular raises. It is the amount of those
    combined raises over 7%

    Raises in the last contract were
    way out of line especially combined with the medical program. I dont think many people took kindly to that and probably did not even know

    The step raise is fine, a negotiated regular item that every district has. However the District leadership, and HEA needs to
    UNDERSTAND that in the private sector COLA raises are pretty much the thing of the past. You get
    MERIT raises and those have been very minimal

    No matter how many times the district and the staff say the electorate does nt get it or understand, and it is probably true from an information and understanding that information perspective, they are the ones
    pulling the lever at levy time
    Why antagonize the electorate ?
    Not very smart. Some comments were made by the ACT group at the Celeste meeting that while true
    still communicates the "people dont get it" It comes off as arrogant sometimes. So ... people get stubborn, figure the district
    "doesnt get it " and votes no.
    Not the right thing to do, because
    the levy has to pass, but the communication in general has been somewhat shaky and and condescending at times.

    We will see what the contract brings and the amount of money
    If it is high, then we are going to have a big issue and a tough time
    convincing a yes vote, even though it is necessary.

    Last point, if the HEA and the District keep supporting state
    office holders who have done nothing for us, then they have no one to blame but themselves.

  30. I will not vote for a levy until I see progress against the key problems in the district. I expect to see better communication with taxpayers, permanent cut-backs that scale back the "champagne taste" to better match our "beer budget", ending sweet tax abatement deals for business (see today's Dispatch about the latest deal), and an impact fee for developers. The Board has made cuts that appear to me to be temporary until they get a levy. For example, reducing some secretaries from 52 weeks a year to 47 weeks a year and other reductions of staffing from full time to part time. Giving them a levy at this point would be like giving a bag of cocaine to a drug addict. I suspect if a levy passed in November, they would restore all the cuts and increase staffing until they spend the entire levy in 2-3 years. They would go back to business as usual, smugly pat themselves on the back at their victory, and thumb their nose at the taxpayers until they want a new levy. Call me cynical but I have seen nothing yet that tells me they got the message from the taxpayers.

  31. Well said.

    Are you talking about the Monroe schools story? I think the school board is wise to inspect that the actual deal they would be approving is consistent with the agreement they formed a year ago. It takes only a few words to substantially change things.

    But the truth is that the city could reduce the abatement down to 75%, and the schools would have no say at all. State law requires the affected school district to sign off only if the abatement is greater than 75%.

    Here in Hilliard, the custom has been to craft abatement deals such that the company granted the abatement agrees to make some payment to the schools to cover most if not all of the property tax income the schools would have received without the abatement. The BMW Financial deal is a good example of this.

    It's a bizarre situation we have in Ohio where a municipality can abate the property tax income of the schools in order to gain the income tax revenue from the jobs created.

    Wouldn't it make more sense for the city to have to abate its own income taxes, leaving the school district to make the decision on abating property taxes? A savvy school board would be willing to work out an abatement deal to recruit new businesses to the district.

    After all, getting a fraction of something is better than 100% of nothing.


  32. Sorry Paul, I should have cited the article I was talking about. It's the Metro section, Community Roundup on B4, Hilliard offering $49,567 tax abatement over 8 years to Netwave. It doesn't say how much of this is school tax, but I am happy to hear that usually they do have to pick up some or all of the school tax.
    I agree that only the school district should have the option to consider abating school property tax. ( That makes too much sense!)

  33. anon at 9:05am,

    I definitely agree with you that the BOE needs to have better communication with the residents.

    However, what do you really think the district & the community as a whole will look like when $14M-$18M is cut (which is what next round would look like)? Under what circumstances (if ever) would you vote for a levy? I've asked these questions on here before and still haven't received a response.

    Again, in general...
    Hopefully, the communication on this blog can be a part of determining where things went wrong and building something positive for our schools and this community. Otherwise, I see it becoming a place where people come to air their criticisms (even if they may be valid) and not much else.

  34. Actually, as a follow on to my previous post... I do think it would make sense for the BOE to SPECIFICALLY outline the next round of cuts ($14M-$18M - I believe), if the levy fails.

  35. Anon said: Hopefully, the communication on this blog can be a part of determining where things went wrong and building something positive for our schools and this community. Otherwise, I see it becoming a place where people come to air their criticisms (even if they may be valid) and not much else.

    The primary reason I started this blog and the companion website was to provide information. Information which should be coming from the school leadership, but isn't.

    And yes, my hope is that learning the truth would cause people to be outraged yet take responsibility for the role all of us have played in letting things to get this point.

    From that outrage comes activism. I took the step of running for the school board, and intend to do so again in 2009. I've had conversations with others who are considering running for the school board as well.

    It feels like a good thing is happening.

    A number of people I've never met before have come up to me and said they appreciate what they're learning from these discussions. Some have asked me to come into their homes to teach them and their neighbors what I've learned about school funding and local politics (all of which can be found on this blog/website).

    And please understand that I'm very much working through the system, not against it. I've already contacted the ACT team offering to take them through the presentation I've put together in hope that it would help their understanding and improve their next presentation.

    Think of me and the folks who comment here as the 'loyal opposition' to, rather than the enemy of the school leadership.

    Sincerely, I'd like nothing more than to be made redundant by an effective communications program run by the district...

  36. To Anon. and Paul. Paul has provided a great vehicle. We are all not going to agree, but at least we are talking about it, and hopefully sharing information with our neighbors and friends. It has been a good learning experience for me and I believe others.

    Perceptions are unfortunatly everything and right or wrong people make decisions on perceptions
    The perception of the HEA and the Board, and the admin. is NOT GOOD
    I think people are tired of
    "you dont understand" "you dont get it" I believe the 4% increase given out for the admin
    staff with contracts was a poor sign and right or wrong people will vote accordingly and rememeber that.

    The circumstances under which I will vote for the levy, as I happenend to the last time.?

    What will be the outcome of the contract ?

    Are the cuts real cuts or
    just temporary suspensions that will come back when the levy passes ?

    Will we stop hearing about
    how people dont get it ?

    With almost 90% tied up in personnel costs, given the economy
    will it be acknowledged that
    we need to adjust some of the previous compensation models?
    Is it about the kids, or is it about increases in compensation
    that are above the current
    levels in the private sector ?

    Will the district, and HEA
    get with the program and get after
    the development of additional
    housing, and insure they start
    talking about significant impact

    Will the HEA, the district, city
    support some candidates that will
    have the wherewithall to bring
    proper compensation from the Statehouse back to districts like
    Hilliard. Will they support
    candidates who will support a
    5 year moritorium on new unfunded
    mandates to the schools.
    All of these groups have the
    financial resources to support candidates.

    Unfortunatly, school issues are
    among the few areas taxpayers feel they have control over. All the special interests have huge war chests to get what they want.
    The individual taxpayer has one
    vote and some choose to utilize
    it negatively when it comes to their individual pocketbook

    The HEA and the District need to understand that they need every vote and despite differences, the attitude of you dont get it makes people go the other way

    I hope the levy passes, I think many people do, but are tired of some of the garbage that has

    I look at a levy campaign as you
    automatically get 40% in favor
    and 40% opposed no matter what
    So you have the 20% left over who can swing things. So hockey time wise, we are in overtime and
    the next goal wins. Winning over
    11% of the 20% does not leave much room for error.

    The belt has to be tightened.
    Some programs may have to go by the wayside. Some increases in class size might be necessary
    It should allways be about the
    kids, not about compensation that is currently very favorable.

    More dialogue and communication and education will help pass the levy. Open minds will deliver. !

  37. Anon from 9:35/9:52 on May 1 here...

    Paul, I agree that there is a difference between 'loyal opposition' and 'enemy'. I do think you are in the former camp. After all, if I understand what you're saying... You do believe more money is needed at some point, but you believe that the way it is being spent needs to change. (Sound about right?)

    I also agree it is great to have a multitude of ideas and from that discourse, it is my hope a positive way forward can be found. Please realize too, that even levy supporters (such as myself) have questioned some of the decisions and communication by the BOE.

    Have a good day!

  38. Actually, I've written very little about the spending side. My concern is, and has always been, on where the money comes from.

    THE ISSUE is that we built houses in our community faster than we grew the commercial base. That's what has screwed up our funding and is creating the need for more property taxes.

  39. Now that I think about it, I haven't seen that many entries from you on the spending side.

    I completely understand the concerns from the revenue side. I'm VERY concerned about the future development out in Brown and Prairie townships. I haven't totally looked into it, but at first blush, the proposed Town Center out there could mean big problems for HCSD by adding a large number of students.

  40. I share your concern about development in Brown Twp. In fact, I live in Brown Twp, right across the road from Bradley High School. It was while serving as a member of the Brown Township Comprehensive Planning team that I came to understand the link between unmanaged residential development and the funding problems that would face our schools.

    And it was also then that I came to understand the unholy alliance between city officials and developers. This posting talks about what I learned. Our own school board was an actor in this drama. It should infuriate you.

    None of us can tell yet whether the Big Darby Accord is a good thing for our community or not. It sounds like it's all about conservation, but it's really about development. Mayor Schonhardt has finally signed on, but only because he got the other Accord members to agree that it's not a binding agreement among the ten jurisdictions. If it's not a binding agreement, then what is it?

    The development pattern of central Ohio has been completely controlled by two binding agreements: a) the water contracts between the suburbs and the City of Columbus; and, b) the Win-Win Agreement.

    In some important respects, the Big Darby Accord supplants both of those. In particular, it sidesteps the Win-Win requirement that any land annexed into Columbus automatically become Columbus schools. It does this by dropping the requirement that to get water service (outside specific areas designated in the suburban contracts) the land has to be annexed into Columbus.

    We have to watch this very closely.

  41. Oh, and you also said: "Please realize too, that even levy supporters (such as myself) have questioned some of the decisions and communication by the BOE"

    Just to set the record straight, my wife and I have lived in the school district for 30 years, and I have voted in favor of every single operating and bond levy that has been on the ballot during that period.

    As I've said many times, the problem is that folks don't understand how school funding works (and it truly isn't that complex) yet don't bother to find out either.

    So the ones who bother to vote at all enter the voting booth and make their decisions based on emotion and heresay.

    This is why this blog/website was created - to help raise the knowledge level of the people of our community so they could do two things: a) make better decisions; and, b) participate in the formulation of the solution.

    Our school leadership should be doing this, but they aren't. I think it's because the prevailing attitude is that the public is an obstacle to be removed (via the Getting It Right For Ohio's Future amendment for example).

    They should instead think of the public as their customers if for no other reason that the public is the primary determiner of revenue. Years of business experience has taught me that if you want to nurture healthy relationships with your customers, trust is the key, and trust comes from open, effective, and frequent communications.

  42. Paul,

    With all due respect, I believe I can honestly say that I've researched the matters with regard to school funding and have a good understanding of how it operates. I have a general idea of how the state arrives at their determiniation of the portion that they contribute, even if I don't know what the specific, detailed formula is.

    That being said, I agree with your point that there are people who don't understand school funding and yet don't do the research. Believe me, when it comes to a levy, there are people that say "I don't understand it and I don't want to. All I know is that my taxes are going up and I don't like it, so I'm voting 'NO'." I really feel that is irresponsible as a citizen - not the voting 'NO' part per se, but the part 'I don't want to' understand part.

    I also agree that the communication between the BOE and the community needs to improve.

    Have a good day!

  43. I was generalizing, and didn't mean to imply that you personally don't understand school funding. But even folks who understand how the state arrives at its portion may not understand the dynamics of the local component - that it's a combination of taxes on residences and commercial property.

    The thing that changed most in the composition of our revenue is not that the State has frozen our funding, it's the local component. Tens of thousands of homes have been build (putting more kids in the schools) and nowhere near as much commercial development has taken place.

    Within our community, we have very limited influence on the state component of our funding. The majority of the legislators are from the rural and urban districts who count on our subsidies, and they're not particularly sympathetic to the situation in the 'affluent' suburbs.

    But we have a lot of influence on the residential/commercial balance within our community.

    Our school leadership washes their hands of this, saying the school district has to educate all kids. And that's true.

    But why doesn't the school leadership, in its process of educating the community, explain to folks that the politicians we need to influence aren't so much the state representatives (which is what ACT advocates) as it the mayors and city council members who clear the way for development?

    This thing about the City of Hilliard signing on to the Big Darby Accord is that it enables the City of Hilliard to annex more land to build more houses to further burden our schools. Mayor Schonhardt and the City Council have a choice.

    They can just say "No!" But they won't unless we put pressure on them. Instead we let Don Schonhardt run unopposed, and elect Dan Nichter to the Council.

  44. To KJ and others

    I have read several comments on the blog about aimed at "getting rid" of the intervention and ELL teachers as a way to save money. Please allow me to educate you as to how and why this category of teachers has increased in the past decade.

    Let's start with No Child Left Behind which was enacted in 2002. This set in motion the Ohio Proficiency Tests (remember if you didn't pass in 4th grade you were to be retained) followed by Ohio Achievement Tests and state roprt card system.

    As a result of NCLB intervention must be put in place for students who do not meet the criteria of the test. Remember, higher test scores result in higher report card ratings which are reflected in your property value.

    ELL students are exempt from the test for only 1 year - regardless of their age and amount of prior education they may have had. So a 16 year old from Somalia who has never attended school has 1 year to become proficient. Hence the need for ELL teachers.

    As for intervention teachers, the term intervention emcompasses a wide range of educators - teachers who work with severely mentally and physically handicapped students, teachers for students with learning disabilities and terachers who provide additional instruction for students to meet district and state benchmarks.

  45. Thanks for your explanation.

    Most folks (including me) in our district don't understand well the impact of the ELL kids in combination with NCLB. As was said at the ACT presentation last week, there are families who come to our school district because it is known how much attention we give to ELL and disabled kids.

    It undoubtedly costs more money, and while we do get some augmented funding from the State because of this, it would be interesting to learn if the incremental funding covers the true incremental cost.

    If anyone knows, please weigh in!


  46. I, too, am curious as to how much extra $$$ this district is having to spend to cover the demands of NCLB. I'd bet that it is eye-opening.

    I've got some definite concerns about NCLB, but I guess that is another topic. Also, if I understand correctly, NCLB is handed down from the federal government, rather than the state.

  47. Follow-on from previous post...

    However, from what I understand, the consequences of missing Adequate Yearly Progress (AYP) - which is a federal measure - differ from state to state. Ohio hands down stiffer consequences than some other states.

  48. Correct - in Ohio when AYP subgroups (ELL, special ed, economically disadvantaged) fail to make theor AYP goals for w2 consectutive years the highest rating a district can receive is Continuous Improvement even if it met all 27 indicators and should otherwise be considered Excellent. Rep. Larry Wolpert was sponsoring legislation to rememdy this...I don't know the status of that. More pressure from constituents would certainly help.

  49. As far a NCLB, the debate has allways been yes it is fully funded,no it is not. It is like two kids in the sandbox.

    You rarely get any specifics, and trust me if I was on the board one of the first things I would do is demand that we immediatly communicate to the electorate what this is costing. It affects everyone.

    The problem is that no elected official will tell you they would not vote forit, because there are too much special interest campaign
    money to go around. Our State Sen
    Stivers, when queried over 5 years ago, would not make a commitment
    to not vote against unfunded mandates. I know, because I asked the question.

    I understand the special needs functions,and it does lend itself to some increased spending.
    However, it is not the sole reason costs are going up so fast.
    Our student growth, fueled by
    unbrideled housing starts not
    effectively regulated locally
    is the start. We need significant
    impact fees to help. We need to go to a sales tax, income tax combo
    instead of relying on the property tax.

    We have to also value our schools and the value they bring to our
    community and our property values
    We also need some cost control
    personnel wise, and not give out
    huge raises and huge step raises
    Admin raises should not be 4%
    Those increases are the big mover
    as the budget is almost 90% salary

    It was comical to hear the HEA president talk about extra curriculars. 10% of 10% is minimal 10% of 90% is significant

    Lets hope we hear something about the recent negotiations, possible settlement, info has kind of dried up

  50. I think most of us here will agree that residential development MUST be balanced by taxes generated by commercial property. Not to mention, developers need to 'pony up' by paying some impact fees.