Friday, May 8, 2009


In both the articles I have posted and the many comments you have made, this blog has explored many aspects of the fiscal operations of our school district. This conversation has exposed many details and nuances which undoubtedly add to our shared knowledge of this subject. I certainly appreciate the dialog.

But every once in a while, I think it's important to back out of the details and review the big picture. This is what emerges as the core fiscal drivers:

  • Our operating funds come from three primary sources: a) residential real estate taxes; b) commercial real estate taxes; and, c) funding from the State of Ohio. As the district has grown in population, the commercial and state funding has not increased at the same rate. In fact, commercial and state funding has not grown much at all. The result is that virtually all the increase in costs must be funded by the residential homeowners via operating levies.

    If Mayor Schonhardt and the City of Hilliard allow the construction of thousands of houses on its newly annexed acreage west of Alton-Darby Rd – and doesn't balance it will equal funding from new commercial sources – this problem will get much worse.
  • Our costs increase for three reasons: a) the number of students has grown; b) the number of employees has grown; and, c) the compensation per employee has grown. The percentage growth of employees (56%) was 50% greater than the percentage growth in students (34%) in the 10 year period between 1998 and 2007 (see table).

    But even if there wasn't any growth in students and employees, the teachers and staff of the district have been getting annual raises in excess of 7% for the past two contracts. This alone pushes our spending up approximately $7 million/yr, and requires an additional operating levy of about 7 mills every three years to support.

    We spend 90% of our operating costs on salaries and benefits, as should be expected for a professional services organization. But that also means most of the other stuff that gets talked about relative to cost-cutting is by definition relatively insignificant. If we don't want another sizable levy added to our tax burden in 2010, we've got to start talking about adjusting the employee pay scales – beginning with the teachers' contract.
Schools are a very personal thing for us, because the schools have a huge influence on our kids – now and for their future. Most of us moved to this community to give our kids a chance to partake of what we believe to be a great school system with great teachers, staff and administrators. By and large, that's exactly what happens. While we have kids in school, and our lives become intertwined in all the activities they get involved in, we tend to be supportive to the point that criticism of the schools is felt to be an attack on the welfare of our kids. I understand that. I didn't give two hoots about school governance while our kids were in school, caringly only about their wellbeing.

But we've reached a point in time where those blinders have to come off, and we must look at the sustainability of the trajectory we've been on – whether or not we have kids in school. We need to ask and answer some tough questions:

  • Are we willing to pay the taxes necessary to have all these folks on the payroll under the current contract terms?

    If the answer is "no," then how do we determine which optional (as defined by law) programs and services to cut?

    If the answer is "yes," then at what rate are we willing to see our taxes increase - $hundreds per year?

    In either case, what is a fair pay structure for the folks who are necessary to deliver the programs and services we expect?

  • Is ongoing growth in student population a good thing?

    If "yes," then are we willing to underwrite most of the costs associated with growth (more employees, more buildings)?

    If "no," are we willing to tell the Mayor and City Council to stop annexing land and issuing building permits?
We have to quit talking about the little stuff, and focusing on the experiences – good or bad – that our own kids have. The school system is the largest, most expensive and most impacting institution in our community. Our attention needs to be focused on the big stuff right now.

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