The Ralston school board agreed Monday to offer an enhanced voluntary separation program for longtime educators in the hope that buyouts can help prevent more drastic budget-cutting measures, including layoffs.
Superintendent Mark Adler sent a letter to faculty and staff members last week, alerting them to possible layoffs next year in light of the “very serious budget situation” facing the district.
The district, he said, has not determined how many positions it might need to trim. That will depend on how many take the voluntary separation option and whether additional revenues come in.
“I think it's going to be a stretch to not have some potential layoffs,” Adler said. “What we hope is we can minimize that as much as possible.”
The district, he said, will have to cut its budget by up to $2.7 million in the 2013-14 school year. That represents about 8.7 percent of this year's $30.9 million general fund budget.
Ralston's state aid has declined more than $1.5 million over the past two years. The school district's enrollment, one driver of state aid, has been down over the past five years.
Ralston also has lost nearly $700,000 from the Learning Community's common levy. At the same time, costs have increased more than $180,000 this year, with $100,000 of that going toward transportation. Ralston's transportation costs have doubled over the past two years, partially as a result of the Learning Community's open enrollment policy that requires districts to transport more students.
Ralston has worked hard to control costs, Adler said, keeping general fund spending flat for three years.
Through attrition, it already has reduced staff by an estimated 10 teachers and other certified educators. The Westside, Millard and Omaha districts also have reduced staff over the past several years through the same mechanism. Ralston also has frozen hiring of support staff for 18 months and tapped its reserves this year.
“As a result,” Adler wrote, “the current budget is as tight as ever before with no further areas available for reduction without looking to our staffing levels in all areas and in all programs.”
Linda Richards, school board president, said the voluntary separation program alone won't solve the district's financial difficulties. That will take multiple steps, she said.
Adler said the district has not yet pinpointed other potential cuts. It will take an overall look at its workforce and its programs and services to see if there are other things it can do differently. He already has received a half-dozen notes from staff members suggesting potential savings.
Board member Susie Tiehen noted that the enhanced voluntary separation program offers the district a final opportunity to reward teachers and other educators.
Ralston has offered a voluntary separation program for some time as part of the contract it has negotiated with teachers and other certified staff members such as administrators and counselors.
Under the current contract, eligible employees who retire when their combined age and years of service equal 85 can receive 55 percent of their last year's salary in a one-time payment.
Under the package the board approved 4-0 Monday, with two members absent, employees would not be required to meet the so-called Rule of 85. Those with 20 years of service in Ralston would be eligible for the regular amount plus a $20,000 enhancement, in two payments.
Those whose service in Ralston and approved experience in other districts total a combined 20 years also would be eligible for the $20,000 enhancement.
About 45 employees would be eligible for the program, Adler said. Most are expected to qualify for both incentives. Employees have until Jan. 4 to notify the district if they plan to participate.
The program won't be funded after next year, under the resolution approved Monday. A change in state law means it will be more difficult for Ralston and other districts to use voluntary separation in the future.
Ralston and some other districts typically have placed spending for such programs outside their general funds, which are subject to a state spending lid. But the state law change will bring that spending under the lid as of September 2013.
The Nebraska Legislature established voluntary separation more than 20 years ago to help school districts reduce their budgets while avoiding layoffs. Some districts have used the program to that end. Ralston, in fact, has enhanced its package in the past to encourage retirements and achieve savings.
Adler said the savings come in the fact that funding for the programs comes from outside the general fund. If an employee earning $60,000 a year retires under that system, that money immediately is available in the general fund. Then the district has the option of replacing the employee with a lower paid employee or dividing up duties and not hiring a replacement.
According to the timeline Adler laid out in his letter, the school board will determine whether layoffs are needed next spring, and if so, how many, after administrators have tallied the number who plan to retire early.
Richards commended the district's leadership team for its communication and the district's staff for its grasp of the situation.
“I'm proud of our staff because I think they're understanding,” she said.
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