Possible Expenditure Reductions
Apr 08, 2016
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- Capital Expenditures, Major Repairs, Equipment Replacement, Etc.
- Operations/Summer Programs
- Property and Risk Insurance
- Transportation Costs
- Building Fund
- Child Nutrition Fund
- Activity Fund
- Other Considerations
- Four Day Week/School Year
- Revenue Increase/Revenue to General Fund or Other Fund Options
- Cooperative Agreements/Exclusivity Contracts
- OCAS Object Code Expenditure Evaluation
- Necessity of Public Information and Media Plan
- Have you thought about?
- Maximize Bonding Capabilities
1) R.I.F. (Reduction in Force): Determine the school district minimum program for accreditation. Ensure process meets negotiated agreement, if applicable. Identify everything else for possible reduction or elimination.
If R.I.F. is for current year, contact your school attorney and consider these things:
- Career teachers (teachers with tenure) cannot be laid off during the current fiscal year. The Teacher Due Process Act does not allow schools to terminate the employment of a tenured teacher in the contract year due to a financial emergency.
- Support employees and other non-tenured certified positions may be reduced during the current fiscal year if permitted by local board policy and the negotiated agreement (if applicable).
If you are considering a R.I.F. for next fiscal year, contact your school attorney and consider these things:
- Certified Personnel: identify positions that can be reduced with the least amount of impact to your educational program. Consult your board policies and negotiated agreement (if applicable) regarding R.I.F. and the bumping of certified personnel. Review the certifications of all certified staff and follow your local bumping policy. It is the responsibility of the certified staff member to provide the employing district with the most updated information regarding their certification.
- Support Personnel: identify positions that can be reduced with the least amount of impact to your educational program. Consult your board policies and negotiated agreement (if applicable) regarding R.I.F. and the bumping of support personnel (if applicable).
- Due Process: provide notice to employees subject to the R.I.F. prior to taking any further action. Schedule a R.I.F. hearing and provide an opportunity for employees to be heard before the board. If the R.I.F. is approved, send notice to reduced employees.
- Recall: consult your adopted board policies and negotiated agreement (if applicable) regarding the recall of reduced employees. How long are you obligated to reach out to former employees and offer them a position with your district?
- Employees that are reduced (position eliminated) will likely qualify for unemployment compensation. Determine your liability for this expense – contact OPSUCA if your district is a member of this program.
2) Review any certifications on file for support staff and follow your local bumping policy. Freeze all positions, evaluate replacing on an as needed basis.
3) Meet with bargaining units (if applicable) to collaboratively determine reduced wage considerations (supplemental salary schedules, extra pay for extra duty).
4) Assess positions that can move to federal programs without impacting MOE and supplanting requirements.
5) Assess Block Schedule personnel costs, if applicable, to reduce staff and other costs.
6) Consider 4 Day Week to save hourly salaries (teacher assistants, child nutrition, custodial maintenance), recruit teachers, and reduce utilities, transportation.
7) Move Athletics outside of the school day; reduce/eliminate athletic programs.
8) Increase class sizes by not replacing retirees, attritioned teachers or RIF’d teachers.
9) Freeze the local salary schedule at the state minimum salary schedule or if paying above state minimum teacher schedule, reduce salaries to state minimum IF STATE LAW changes to allow reductions in salary across the board.
10) Coaches drive buses (if within school day).
11) Freeze any promotions and salary recommendations for change.
12) Consider furloughs.
13) Reduce substitute rates for certified and non-certified substitutes.
14) Reduce hourly rates for support personnel (ensure that minimum wage is met).
15) Identify all “extra” benefits provided to personnel (life insurance and disability insurance). Consider eliminating these if feasible.
16) Transfer custodial and maintenance personnel to building fund payroll, if funds available.
17) Eliminate all stipends (cell phone stipends, in-district travel, if allowable and does not violate negotiated agreements).
18) Consider contracting with a Vendor for custodial and child nutrition services to avoid workers’ compensation, possibly reduce management issues, numbers of employees and increase efficiencies.
19) In some cases, reduce or attrition certain personnel for one year (public relation, athletic director, librarian, counselor, school nurse etc.). This could result in an accreditation deficiency for some positions.
20) Combine support positions.
21) No substitute teachers. Consider asking for volunteers from the community.
22) Reduce administrative staff and/or combine positions allowed by law for principal/superintendent positions.
23) Cut salaries by __% for principals and administrative staff.
24) Offer Early Retirement Incentives. (Examples in packet.)
25) Superintendent retires and returns after 60 days to reduce costs yet still remain as Superintendent.
26) Consider moving to hourly contracts for support staff, eliminating contracts based on days worked.
27) No step increases.
28) Reduce length of contracts (12 month to 11 or to 10 month contracts).
29) Combine classes, eliminate electives with fewer numbers of students.
30) Combine grade levels as necessary for as much efficiency as possible with staff.
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1) Eliminate all capital expenditures and obligations from the building fund and general fund.
2) Consider bond issues to replace lease/purchase agreements.
3) Consider bond issues for repairs, equipment, furniture, vehicles, etc.
4) Review maintenance contracts (pay for the repair versus the “what if” contract (Copier, technology, as examples.)
1) Eliminate all summer programs that require building use.
2) No summer maintenance work (paint, finishing floors, etc).
3) No refinishing gym floors.
4) No hiring of part time summer workers (coaches, students, teachers).
5) No summer school classes.
6) Very minimal mowing and watering of grass.
7) Close buildings during winter/summer breaks for a day or timeframe for utility savings.
8) Reduce lighting (change from high energy cost bulbs to low energy cost bulbs).
9) Consider 4 Day Week to reduce utilities.
10) Consider Energy Management Program (hire and train person internally or hire company with costs for contract paid through savings)
11) Contact schools that have local Energy Management Programs for tips, booklets for internal management. (Example in packet)
12) Contact PSO/OGE to work with district to issue a rebate for reducing peak loads on the company.
1) Increase insurance deductible.
2) Remove some “stand alone” buildings from insurance coverage (must consider that building would not likely be replaced in case of loss).
3) Consider self-insurance of buildings and Workers’ Compensation costs, or work with Workers’ Compensation vendor to reduce rate charged per employee.
4) Bid Property Insurance.
5) Check all property values on buildings and on vehicles to ensure that values are on the schedule and on the schedule accurately.
6) Reduce Unemployment Costs, consider OSSBA/CCOSA’s OPSUCA program.
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1) Elimination of school provided transportation is an extreme measure, but it may be necessary.
2) Assess all bus routes and stops to consolidate or eliminate bus routes.
3) Reduce bus routes, if transporting within 1½ miles and unless safety is compromised, to save.
4) Bid all fuel used for buses and maintenance vehicles.
1) Restrict expenditures from the building fund to: custodial, maintenance, insurance, utilities.
2) Shift allowable general fund expenditures to building fund.
1) Develop a self-supporting financial structure for the C/N fund.
2) Eliminate general fund subsidies to the C/N fund.
3) Increase lunch prices if necessary.
4) Develop a Loan Agreement with the CNS Fund to “payback” the General Fund for certain allowable costs (utilities, facility use, maintenance agreements, etc.) form is found in the OCAS Coding Document. (Example in packet.)
1) Develop a self-supporting financial structure for each sub account within the activity fund.
2) Eliminate general fund subsidies to the activity fund.
3) Provide a structure for activity fund reimbursement to the general fund for telephone bills, gasoline, utilities, etc. – for athletics, agriculture, band, pep club, etc.
4) Reduce extracurricular activity trips.
5) Raise gate prices.
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1) Sell all unnecessary vehicles.
2) Sell all surplus vehicles.
3) Reduce curricular field trips.
4) Freeze all spending or STOP all spending unless necessary.
5) Reduce school site budgets or suspend school site budgets.
6) Reduce or drop land phone lines except for those required for safety and security.
7) Check all Technology GIG connections for costs; consider alternatives for technology management—virtual perhaps.
8) Reduce staff travel.
9) Consider teachers cleaning their own rooms, thus eliminating janitorial service or employees.
10) Maximize investment returns by changing board meeting dates and dates of processing payments.
11) Sale of buildings or property (remember, these are ONE TIME monies).
12) Reduce or freeze travel in and out of district.
13) Reduce mileage rate reimbursement (don’t use state rate, use another rate such as 20 cents per mile if reimbursing. Employees can claim balance on income taxes.)
14) Consider personnel assignments that require reimbursements, then decide reimbursement at reduced or flat rates to lower costs.
15) Sale of buildings with a clause for opportunity to buy-back within ___years, gives you cash flow.
1) Critically evaluate the benefits of a four day week. (Information in packet.)
2) Significant financial gains will be recognized only if personnel costs are reduced.
3) Although the savings appear to be present, there will be very little cost reduction in utility costs.
4) There will be some savings on daily bus routes by reduced costs of fuel and bus driver salaries.
5) Transportation savings in the extra-curricular program will be very minimal.
6) Carefully evaluate the expenditure savings in the C/N program with the 4 day week. The C/N revenue will be reduced by approximately 20% (4 days instead of 5 days per week). Expenditures must be reduced by this amount just to break even. Food and milk will automatically be reduced, but personnel costs must also be reduced.
7) Shorten school year—current year, ensure that school year meets law requirements for hours or days options; ensuing year, ensure the same for law requirements for school year; look at contractual obligations with support staff to determine if possible or can their contract days be reduced as well without violation law, or move contracts to hours.
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1) Start a day care program. (Suggested contact: Edmond or Moore Schools. Example in packet.)
2) Consider approaching municipality for a sales tax option for funding capital or non-capital projects (Suggested contact: Shawnee or Bethel Schools.)
3) Review all interest earned in Bond Fund and determine if possible to shift to General Fund or expend for bond purposes as outlined to relieve General Fund types of expenditures. (Remember it is one time money.)
4) Review Impact Aid revenue and where money deposited and its use. Allowable to be deposited in the Building Fund by law. If used for personnel, it is costing the district money with personnel costs (TRS, other taxes).
1) Explore the possibility of cooperative agreements with other school districts that include:
Sharing teachers of: foreign language, AP classes, science, math, music, art, special education, alternative education, etc.
2) Cooperative agreements for purchasing (Buy Board/US Commodities), counseling services, librarians, technology personnel, etc.
3) Cooperative agreements for central office services for technology supervision or virtual supervision, payroll, treasury and encumbrance clerk services.
4) Consider an exclusivity contract with a vendor (NIKE, BSN for uniforms, as an example).
1) Each school district should run a detailed expenditure analysis for OCAS object codes 300-999.
2) Analyze each item of expenditure. Ask the question “Can the school survive without this expenditure?”
1) Prepare a plan for communication. The task of adjusting to revenue shortfalls by reducing expenditures is too great for the administrator alone.
2) Involve all Stakeholders. The school board, school staff, and community patrons must all take part in the process.
1) Check appropriation level to ensure you have enough appropriation to cover expenses.
2) If not, check to see if you can increase your ad valorem collection estimates with a Supplemental Form 150 to the County Excise Board.
3) If not, check to see if you have state or federal money to appropriate with a State Aid and or Federal Funds, SA&I Form 307.
4) If you have received a penalty in state aid, seek help for relief of penalty as law or rules allow.
5) Know what the penalties are for excess carryover, administrative costs and Maintenance of Effort requirements (Special Ed and Title 1). Plan for penalties, if applicable, when planning the budget. Don’t let penalties be a budget surprise!
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Many schools can improve their financial condition by implementing a more proactive bonding program.
Median = 10.49 mils Median not including 0’s – 14.02 mils
1) Cash Flow Problems in General Fund—Borrow from another fund as allowed by law; Issue non-payable warrants as allowed by law. (Form in the packet.)
2) Do not reduce salaries and benefits below the previous year as required by law. (Penalty information in packet.)
3) Do not create federal maintenance of effort for special education problems by spending below previous year. (Information and examples are in the packet.)
*This list was compiled with the assistance of OASA members, Vernon Florence, OROS School Superintendents and Metro Area Superintendents and CFOs, Steven Crawford, Ryan Owens and Pam Deering. As new options or suggestions are recommended, the list will continue to change. Many of these items may or may not meet the needs of your district based on the climate and culture of your district, but they are meant to provide a wide spectrum of options and suggestions to think about as school funding is at a crisis level for this year and next.