Cackle Fruit! Annacannatuna!

Remember that old 3 Stooges episode when the guys are making a "Bubble Gum" birthday cake at the drugstore...and they're shouting out ingredients?
"Cackle fruit! [Cackle Fruit]"
"And a can o' tuna! [Annacannatuna]"

That's kinda how we felt about the December Budget Adjustments.  You look at these documents and it's a mishmash. It's completely Greek.  Hell, we should be teaching Greek, not Mandarin Chinese.  It's like the Bloomin' Onion at Outback.  peel away layers and you just find more.  It's like Rube-icks Financial Cube.  But we digress...

On Monday January 23, the school board's Finance Committee met, and the major agenda item, which seemed innocuous enough at first glance, was "December Budget Adjustments.   But--as usual--there's more here than meets the eye.  And FAR MORE than was discussed in the situation report.  The situation report, prepared by Business Service Manager (and Deputy District Administrator) Phil Frei, said,

The General Fund (Fund 10) was increased by $20,000 due to an Alcohol and Other Drug Abuse (AODA) grant. A component of the December budget adjustments was transferring $84,074 from the Sun Prairie Education Association (SPEA) FTE budget into the workers' compensation budget. The workers' compensation budget needed to be increased due to an audit, by EMC Insurance, of payroll. All budget adjustments were routine in nature.
--- December Budget Adjustments Situation Report

The Situation Report also indicated that, "The Special Projects Fund (Fund 21, 23, 27, 29) was increased by $78,743 due to special education grants and donations." But let's not even discuss that. Let's focus entirely on the General Fund (Fund 10), the mainstay of the school district budget.

Seems pretty simple...right?  The district received an unanticipated grant for $20,000.  That would count as revenue.  It would then, of course, be offset by $20,000 of increased expenditures on the Expense side of the ledger.  Then we have the matter of needing to transfer $84,074 from the salaries line into the Worker's Comp. insurance line.  Gee...remember when we were told that due to "aggressive bidding", the district was able to achieve $150,000 in savings to the Workers Comp and other insurances budget?  Guess that just got cut in half, eh?  And how are we paying for this "oops"?  By transferring the equivalent of 1.8 FTE of available but as yet unfilled SPEA members.  Hmmm.

But let's look a little more closely at what transpired.  At then end of the day, the expenditures line of the budget increased by exactly $20,000 (or roughly 0.025% of the entire district budget).  The $84,074 is really immaterial because we just simply move the expense from one line to another.  So really it should amount to maybe splitting the $20,000 into a couple of budget lines, right?

WRONG!

What actually happened was:
50 different budget line items were adjusted.  50!
A total of $753,812 was shifted between line items in the budget.  That's nearly 40 times the total amount of the budget adjustment.
One specific line item was increased by a mere $80.  $80 dollars???!
22% of the budget line changes amounted to $1,000...or less!

What's going on here?
The school district doesn't like to be micro-managed, yet we're adjusting budget line items by as small as $80?
Does it really matter?  So one line item over spends by $80 and another is under spent by $80.

Clearly one of three things happened here.
A. This is yet another example of poor data coming out of the Business Service group.
B. We are witnessing first hand the Philly Shuffle as it applies to budgeting, or
C. Maybe this Situation Report was a tad less detailed than it should have been

The Most Alarming Part
If you follow the money (see Situation Report Attachment 3), the Business Administration function (Function code "25", or 250000) took the second largest hit, having their budget reduced by over $110,000.  When asked about this, Phil Frei responded that "I wasn't planning on spending that money anyway".
What...what....WHAT!???

On how reducing the Business Administration budget reduced by $110,000 would affect the district,
"I wasn't planning on spending that money anyway"
--Phil Frei, Deputy District Administrator & Business Services Manager

Really!  So...if you weren't planning on spending it...why was it in the budget in the first place?

This is precisely the lack of transparency and suspect accounting practices that continues to anger community residents.

We were hoping that the quality of data coming out of the district,m and overall transparency would improve.  So far, 2012 isn't look much better than 2011.

Look! Up in the sky! It's Cackle Fruit! 
 It's A Bloomin' Onion! 
 It's Rube-ick's Financial Cube! 
Naaaaahhh...It's just more of Sun Prairie's school district budget.

Public Hearing on the Budget this Week

08/12/2009 SPECIAL FINANCE COMMITTEE MEETING
7:00 p.m., at the District Office, Room 100,
501 S. Bird St., Sun Prairie


Yep....at long last there will be a public hearing on the budget. However,...just like last year...there's no information for you to review. Can you say "SHENANIGANS"? What a great game plan: if the district doesn't make all these numbers available to the public until just before the meeting, then there's no way the public can make enough sense of them to formulate an opinion. Therefore, the District can march ahead and do what they want and say, "Well, we held a public hearing and received no comments".

What we can tell you is this: The District plan is to have a budget that will raise the mill rate at least $1.28 over last year to $11.81 per $1,000 of assessed value. An alternative plan would allow the district to spend up to the revenue limit (an additional $591K). That would result in a mill rate increase of $1.43 ($11.96/$1,000).

The budget assumptions include cutting all building budgets by 5%. This includes materials and supplies for all the schools! Gee...isn't it nice that the belt tightening finally comes at the expense of the students---AFTER the employees have all gotten very healthy raises. Don't kid yourself about those "3.8% Total package" figures, either. Many employees are seeing salary increase much greater than 3.8%. Where's the shenanigans? Consider why the board rushed to resolve contracts faster than they have ever done. Culver likes to say that the contracts are a significant piece of the budget which must be agreed upon before you can see budget information.

Horse Puckey! You BUDGET for how much you are willing/able to spend and THEN open negotiations. Board members will tell you that they didn't offer less for fear of losing in arbitration. They should all be poker champions if they can truly say that with a straight face! In this economic crisis, there is NO WAY the district would have lost at the arbitration table.

So there, you have it ladies and gents. At the MINIMUM, it looks like the school district portion of property taxes on a $200,000 home will increase by $256.

Our advice to you---if you care at all-- is to:

(A) raise holy heck with the district office and the school board for scheduling a public hearing with NO ADVANCE notice of budget data. Call 'em. E-mail 'em. Let them know that it is unacceptable to not make this data available at least a week in advance.

(B) Come to the budget hearing and tell them you're upset about (A) and then speak your piece about spending.

But...but...we're in the top 10

First...and foremost...the "Stuff the Bus" promotion is an awesome example of community members and businesses coming together for a great cause. We want to make it clear that we need to separate the two concepts: Good cause vs. Spin doctoring.

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Stuff the Bus with School Supplies
Sarah Heck [seheck@spasd.k12.wi.us]
Sent: Friday, July 31, 2009 9:57 AM

District e-News to Key Communicators:
Sun Prairie community members can help Stuff the Bus with school supplies beginning today, July 31 through Saturday, August 1, to help families in our school district who struggle to afford school supplies. More than 1500 students in the Sun Prairie Area School District cannot afford school supplies.

---

Here's our issue: 1500 kids, out of a school district of 6000 means that 25% of the kids in our district cannot afford school supplies.

How would that be? After all, Sun Prairie just got named one of the "Top 10 Towns for Families" in the August edition of Family Circle. Certainly a town that is "good for families" does not mesh with the idea that 25% of the kids in those same families cannot afford basic school supplies.

Oh, wait. Maybe that's because they didn't interview one of THESE families. Instead they interviewed a family where one parent is a high salaried engineering consultant who did some work for the school district. And the other parent, is a "Research Data Assessment Specialist" employed by the school district at a very healthy salary. But, of course, Family Circle didn't mention the interviewees' connection with the district and that they do not represent the "average" Sun Prairian in terms of income.

Yes...Sun Prairie is a nice community. The school system has an excellent foundation because of its teaching force. But something is inherently wrong on the community front when 25% of the students cannot afford basic school supplies. I don't think anyone can argue that point. And that is the point we want to leave you with.

Our school board continues to spend, spend, spend...and the number of kids who cannot afford basic school supplies (and families who need to buy them) continues to increase , increase, increase.

So...thank you Kobussen and community members for giving. Thank you school district for setting this up. But school board members....as you work on your budget...could you maybe keep that 25% figure in your collective heads? It's time to start tightening that belt.

Is the Perfect Storm on the Horizon?

Are we headed for the ‘Perfect Storm'? For those of you who have been paying attention to the District’s operations for the last few years it is all starting to add up to the "Perfect Storm"…financial storm that is! For those that haven’t been paying attention let us bring you up to speed on the districts financial commitments that are about to come to roost.

$115M in Construction
The School District is in the middle of the construction of the new High School (including a pool) and renovation of the current high school into an 8/9 school the total of which will cost the taxpayers about $100,000,000. We opened Creekside elementary last fall (~ $15M), and there’s already talk about an EIGHTH elementary school (although Creekside is barely at 50% capacity). There are already reports (they ALWAYS hold this stuff close to the vest) that the “contingency” portion of the construction budget has been exhausted…and we’re over a year away from opening! Remember that 2/3 of the money was borrowed THIS year...which means we'll see it in the upcoming budget. That means this years' property taxes 0

The new 4K Program will COST us
4 year old kindergarten will begin this Fall and, despite hopes that the district will MAKE money off of the additional kids down the road, this first year will result in a DEBIT of about $140,000 based on projections. Of course this all assumes that we reach an enrollment of at least 350 kids and aid to districts remains as projected last winter (NOT!!). District officials will quickly try to point out that in years 2 and 3 the 4K program will generate income but have no assurances from DPI that the funding will be at the same level or at all as it has in the past. In fact, start up funding was cut this year for the first time since the program started.

Recessionary Unemployment and Wage Cuts
Regional unemployment is hovering around 10% and workers throughout the community are having to take unpaid furloughs and pay cuts while teachers, who we support and believe should have fair and reasonable compensation packages, are getting about a 7% pay RAISE over the next two years based on their recently approved contract. For the next budget year, that contract will cost taxpayers an additional $2,000,000.

More raises...while others see furloughs and pay cuts
At the 7/13/09 school board meeting, we expect the board to approve pay raises to Administration Support staff that represent a 3.8% “total package” increase. Remember that teachers got the same 3.8% “ total package “ increase, but the salary portion of that calls for raises of 4.2% THIS year. Next up will be district administrators themselves…you know…the $100K club. Past practice is to give Administrators what teachers got in the prior contract…which was over 4%! 4.2% of $100K means an increase of at least $4200 for each of them. Will YOU be getting a $4,200 raise this fall? Lastly District ADMINISTRATOR (Super Nintendo) Tim Culver will also get a nice pay raise to augment his current salary of $145,000…just you wait and see. Do the math. What’s 4% of 145,000?

Devaluation of Property

Sure...we love it when our assessments go down...well...kinda sorta. But when EVERYONE's property valuation decreases, as is happening right now, then the tax base shrinks. That means that everyone will have to pay a higher share of property taxes to cover the cost of running the school district and all its increased spending. Yes...we have the new Target....but is it enough? It's a concept that can be somewhat simplified. If the total value (called the "equalized value") of all the property in the district is $1,000,000 (It was more like $3.2B last year), and the school district budget increases to $100,000 (the TOTAL budget is more like $110M), then the school district mill rate (cost per $1,000 of home value) is $100. No if that equalized value shrinks to $900,000, the mill rate rises to $111 ( [100K/900K] X 1000 ).

We hear the City Council talking about holding the line on the mill rate. Heard any talk like that from the school board? Didn't think so.

Slowing Growth
Growth in the school district appears to be as shriveled and dried up as....well....let's avoid that analogy and just say that it's no longer on 'roids. If the school year started tomorrow the district would have an enrollment loss of about 82 students at elementary school level alone over last years Third Friday Count. And say...has as anyone noticed the number of new and existing homes on the market?

Enrollment growth is the lifeblood of a school district. Why WOULDN'T Dr. Tim be crowing about these precious "kids"? They pay his ginormous salary! "The kids" are valued at about $10,000 each when it comes to state aid. An enrollment loss of 82 kids at the elementary school level would result in a loss of State funding to the tune of about $900,000! (In all fairness there is typically a surge of enrollments in August which will fill in some of those losses but will it be enough to get the same level of funding as last year, only time will tell.)

Unprecedented DPI Cuts to State Aid
The Wisconsin DPI has indicated that they will be cutting aid to school by 3.5% each of the next two years. It is a little unclear now where those cuts may come from but rest assured they will come. But if you read the State Journal, today’s edition has an article about Madison taking a 15% cut in state aid. Remember? Madison? A special part of the budget that called for them to only get a maximum 10% cut?
We have YET to see even a HINT of a budget from the school board. A public hearing is usually held in late May or early June. There is discussion about a possible public hearing on the proposed budget—which no one has yet seen—on July 20 or 22.

---

Admittedly, some of this stuff is difficult to predict but the conditions of reduced funding and increased spending are in place and we seem to be headed for the ‘Perfect Storm’! That right folks, WE will be left holding the bag when it comes time to pay for these commitments made by the District Administration and the School Board. So when the storm gets here you know who you can thank…”Supernintendoadmistratorsupreme” and the school board members who for some reason couldn’t see this one coming.
[SP-EYE-there have been a handful of instances of board members showing restraint by voting against a costly item like Jill Camber-Davidson-4K and Al Slane with the teachers contract but they are too few to mention and in the end were passed with a majority vote.]

If the storm never gets here that’s fine, we can admit that our prediction was wrong. Just like the weatherman's predictions, conditions may be ripe for severe storms that never develop. All we are really saying is that, during these financial times, a hint of fiscal conservatism would be nice. Let’s be conservative and error on the side of, as 2009 School Board Candidate John Welke first put it, “being good stewards of the tax payers dollars.”

No matter what happens, a tsunami, thunderstorm, light rain or sunny weather we are confident of one thing. School Board Member Jim ‘Sea Bass’ McCourt will be belly up to the nicest restaurant available at next year’s WASB Conference eyeing up high end entrée’s you and I will have to pay for. After all, even though he lives in a home valued at more than $400K, he has earned it by way of time spent at school board meetings and via all of the community engagement activities he is involved in as a board member and community engagement committee president…at least in his mind, he has!

N