Budget cuts: Ann Arbor schools to cut high school busing, charge kids for 7th hour

Parents of Ann Arbor high school children will have to find another way for their ninth- through 12th-graders to get to school come fall, and students interested in taking a seventh-hour course could have to pay up to $500 per semester, based on a budget discussion the Board of Education had Wednesday night.

The Ann Arbor school board spent the evening tweaking, pulling and prodding every last dollar it could from a list of 30 proposed budget reductions for the 2013-14 academic year.

More than 70 employee positions still are on the chopping block, as well. And new employee groups were added. To try to cut fewer teachers, school board trustees asked central administration to look into cutting office secretaries and perhaps staff in the student support services department.

The Ann Arbor Pubic Schools needs to reduce its operating expenses — through a combination of cuts and increased revenue — to the tune of about $8.67 million by June 30.

Trustee Andy Thomas described the process as similar to a giant waterbed, "where you push down here and it pops up over there," meaning for every cut pulled off the table, the money must come from somewhere else. And, he said, often a savings in one area can result in an expense in another, if the district is not careful.

At the end of the board's five-hour study session, the majority of the administration's proposals — which were brought before the board on April 24 — remained on the table in some form. However, the trustees' deliberation did result in some cuts being lessened and others being given back to the schools or program directors for more freedom on how to come up with the cost savings.

The purpose of Wednesday's session was to give the administration a clearer picture — prior to the first public hearing on the budget May 22 — of what the board was amenable to cutting. The district legally is required to conduct two public hearings on the budget prior to approval. The second will be June 12, when the board also is expected to vote on a budget.

Among the items the board agreed to leave as-is in the proposed budget were:

• Eliminating high school transportation, $466,000.
• Closing the middle school pools, $70,000.
• Eliminating some counselors (3 full-time equivalents for $300,000).
• Freezing library purchases for a year, $100,000.
• Reducing noon-hour supervisors, $71,000.
• Most of the proposed cuts to athletics (for a total savings of $512,685).
• All of the proposed cuts to building operations and maintenance.
• Reducing the central office personnel by 6 FTE and restructuring, $477,540.

Despite the five hours trustees spent in deliberation over the budget, they could not come up with a way to save the 32 teacher FTEs the administration proposed eliminating for a savings of $3.2 million.

Originally, there were a total of 80 employee positions on the chopping block for next year. The board agreed to reduce 1 grounds employee, 15 custodial staff and 1 crew chief with little fanfare.

Trustee Simone Lightfoot asked about how the staffing cuts would affect the complaints AAPS receives about trash on school property, stressing she still wants the district's facilities to be clean and well maintained. Executive Director of Physical Properties Randy Trent said these reductions would require the district to get rid of 648 trashcans on school grounds.

He said AAPS only would retain the trash receptacles next to the entrances of its buildings so that the janitors could empty the bins on a daily basis, rather than maintaining additional grounds staff to do this.

"The idea is we would be relying on most people to be respectful and would have to encourage ... people to be responsible for picking up after themselves," Trent said.

He added the reduction of custodians would be at the elementary schools, where classroom cleaning still takes place daily. The district went down to cleaning classrooms at the middle and high schools every other day, while continuing to pick up trash and clean the bathrooms every day. This is the schedule the elementary buildings will transition to.

More than 50 of the recommended position reductions are classroom teachers, including the 32 undesignated FTE, 5 FTE for the seventh-hour option at Huron and Pioneer high schools, 3 FTE for Skyline's trimesters, 3 FTE for fine arts and physical education, and 10 FTE for reading intervention specialists in grades 1 and 2.

In the administration's initial list of potential cuts back in December, reducing 3 FTE at Community High School to eliminate the school's block scheduling also was suggested. It would have saved the district $300,000.

Trustee Glenn Nelson proposed putting that $300,000 back on the table, as well as Pioneer and Huron's combined $500,000 savings through the elimination of seventh hour, and charging tuition for students who want to be able to take seven classes instead of six.

Schools officials have said the per-pupil foundation allowance that the district receives from the state is only for six classes per semester, 12 per year. But Nelson noted how the board has heard repeatedly from the community about the value of a seventh class option at these three high schools, and how it allows students to take four years of music, four years of foreign language or additional Advance Placement courses to earn college credit that a traditional six-hour school day does not allow.

Board members estimated in order for block scheduling at Community and seventh hour at Huron and Pioneer to be self sufficient, the district would have to charge between $300 and $500 per student per semester. But Thomas said that still is far less than a college course.

In addition, the board was interested in going to Skyline High School leaders and asking them to find a way to generate a savings of $300,000 within their building so they could keep their trimester schedule. The central administrators proposed moving Skyline to a semester schedule. Thomas said whether Skyline believes it can operate its trimester program with three fewer FTEs or needs to make cuts in other areas, it doesn't matter to him, as long as the net reduction is $300,000.

Officials said Wednesday the fine arts and gym teachers could be reduced through attrition and restructuring and would not result in a cut to the programs themselves.

The board agreed to cut five reading intervention teachers instead of the proposed 10.

The Pioneer Theater Guild also may get to keep its theater technician position. The board recommended approaching the theater group to find another way to save $50,000, the estimated cost of the position. Community, Skyline and Huron's theater programs do not have a technician, however, they do have part-time stage managers.

Vice President Christine Stead asked where the 32 undesignated classroom FTEs would come from. Officials said about 4 FTEs have been identified at the elementary schools but the rest, most likely, would be reduced from the high schools, considering the middle schools saw significant teacher cuts the past several years and already are pretty lean.

Because of the district's budget situation and having drawn down its "rainy day fund," the district may be forced to lay off teachers for the first time. The district only has received about 15 retirement notices so far for next school year. It typically sees 40 to 50 retirements annually.

None of the school board trustees are comfortable cutting that many more teaching positions, given that AAPS has reduced its teachers by 65 FTE since the 2008-09 school year, the district's enrollment has remained stable and its class sizes continue to grow and be a concern among parents. As a result, the board brainstormed other items to put back on the table or new items for the district's administration to look into.

Among the possibilities discussed were:

• Principal sharing among six elementary schools for a savings of $300,000. Nelson proposed this and said he recognizes that principals are worth more than $100,000 a piece. But he recommended a lead teacher model, where at the schools with shared principals, there would be a teacher designated with some additional leadership responsibilities, requiring extra compensation for the teacher.
• Eliminating the district's additional .5 physical education requirement for graduation — an estimated savings of $450,000. Officials explained the state requires just one P.E. class to graduate, but AAPS requires an additional semester.
• Reducing the number of office secretaries by about 10 FTE for an estimated savings of $600,000. Officials reported there are about 111 office professionals in the district.
• Allowing digital billboards to be installed on school property at Huron, Pioneer and Wines Elementary School for $100,000 in advertising revenue. Some school board trustees were not in favor of this at Huron or Wines, but would be OK with it at Pioneer due to the University of Michigan Big House being located across the street and neighbors being used to those lights.

The school board also agreed to most of the athletic cuts, except asked the athletic directors to find another way to reach the approximately $512,000 in savings that did not include cutting middle school baseball, softball and seventh-grade basketball. Officials said this likely could be done by increasing the pay-to-participate fees a little more, such as charging students $50 for a second sport. Right now students only pay a one-time fee for up to five sports seasons.

AAPS has a general fund budget of approximately $189 million for the current school year. The district's third quarter financial report recently showed the Ann Arbor Public Schools is $3.8 million over budget, which is expected to drain the district's fund equity, or primary savings account, to $6.8 million by the end of the school year.

The Board of Education authorized on May 8, for the first time in the history of AAPS, the district borrowing money to make payroll during three periods of low cash flow that officials are projecting between now and December. The board previously was given the false impression that AAPS only had to have about $9 million in its fund equity in order to avoid borrowing. But trustees found out last week that minimum balance actually is closer to $16 million.

The district will be borrowing a total of about $10 million through a line of credit through a bank.

The board started Wednesday's study session with an update from the state's so-called revenue estimating conference, which took place in Lansing earlier in the day. Lawmakers estimated that revenues to the Michigan School Aid Fund and general fund could be $500 million greater than projected.

However, Nancy Hoover, executive director of finance and chief financial officer for AAPS, said K-12 education is not expected to receive any of this money and the push in Lansing has been for the extra funds to go toward roads.

She said if public schools do receive a portion of the $500 million, it will go toward off-setting retirement costs, which Hoover said would stabilize the budget a bit and help prevent the district's contribution per employee to the Michigan education pension system from rising above 30 percent.

Danielle Arndt covers K-12 education for AnnArbor.com. Follow her on Twitter @DanielleArndt or email her at daniellearndt@annarbor.com.