Other painful cuts are probably on the way for a Carlisle Area School Board facing hard decisions on how to close a projected $3 million deficit.
District administrators have already recommended the board outsource 87 instructional aide positions to Education Staffing Solutions in an attempt to save an estimated $700,000 in personnel costs.
Board members have yet to vote on that proposal, which filled to capacity a meeting room in November with parents, teachers and support staff concerned the outsourcing would negatively impact the quality of education especially of needy children.
More recommendations are expected by late winter, Superintendent Christina Spielbauer said Thursday. With the looming prospect of dwindling reserves, chances are likely proposals could include other cost-cutting measures involving staff and possibly faculty members.
Business Manager Owen Snyder presented an overview Thursday of a draft expense budget that includes the proposal to outsource instructional aides. Removing those positions from the district payroll could save costs in the form of retirement and health insurance benefits, district director of finance Shawn Farr said.
Even with that proposal, the district faces a draft expense budget of $87,330,030 that exceeds the draft revenue budget of $84,330,097. If the board votes down the outsourcing proposal, it would negate the savings and increase the shortfall to $3.7 million.
As it stands, the expense budget does not include a real estate tax increase, Snyder said. The Act 1 Index would limit any increase in the millage to a maximum of 3-percent next year generating about $1.3 million in new revenue.
Snyder said state lawmakers could increase the basic education subsidy to Carlisle by another $250,000 to $300,000. Even then the combined boost of tax revenue and subsidy would only bridge roughly half of the projected budget gap, and that is if the board approves the outsourcing proposal that could save the district $700,000.
“We have not acted on anything yet,” board president Paula Bussard said Thursday. Earlier that evening, she was reelected to the leadership position following the December reorganization meeting.
“State government does not increase its spending for basic education or special education [subsidy] in any way that approaches inflation,” Bussard said. She said yearly increases in the retirement contribution and health insurance exceed the inflation rate and the ability of the district to generate new revenue under Act. 1.
Based on the organization as it is structured today, Carlisle school board members can expect annual budget gaps of millions of dollars each year for the foreseeable future, Snyder said. Meanwhile there has been a sharp decline in the amount of money in reserves.
The district has to maintain a certain fund balance to keep its credit rating at a favorable level to save on the costs of insurance and interest payments on future long-term debt.
“We have stretched every building,” Bussard said referring to the operational capacity of school facilities. “We need to have a certain level of rainy day reserves. I don’t know what that level is but we as a board have to think about it.”
During his years on the Carlisle board, Gerald Eby has seen the state basic education subsidy shrink from about 50 percent of the district budget to about 17 percent. In November, he said Pennsylvania school districts have been saddled in recent years by the mandate to repay money that had been poorly invested by state authorities during their control of the Pennsylvania Public School Employees Retirement System.
That mandate requires school districts to contribute a percentage of employee salaries to PSERS, of which the state would eventually reimburse each district 50-percent of the upfront costs.
In fiscal year 2012-13, the Carlisle contribution rate was about 12.4 percent, Snyder said. The projected rate for the district in 2019-20 is 34.79 percent or almost 35 cents for every dollar of salary being paid out to district employees.
“That is extremely challenging,” Snyder said. However, the annual rate has started to level off, he said. The percentage for 2018-19 is about 33.4 percent.
Board member Rick Coplen called on state lawmakers “to do the right thing for our children” and address the fiscal strain the pension crisis is placing on Pennsylvania school districts.
“We have a gap to fill,” Coplen said about the $3 million shortfall. He said the board may be compelled to fill the gap with dwindling reserves and with recommendations the administration has made or will make in the near future.
Board vice president Linda Manning challenged state lawmakers to attend the next budget briefing of the Carlisle school board so that they could get an education on the plight of public school districts.
“They need to hear this,” Manning said.
“We have a new representative in the 199th [Legislative District],” Bussard said. She was referring to Barbara Gleim who served on the Cumberland Valley School Board before being elected to the state House of Representatives.
Gleim would have a better understanding of the disparity between state and local funding along with the mounting pressures school districts face in making ends meet, Bussard said.
Though Carlisle has to wait until January when Gleim is sworn in, several school board members have already met with her to air their concerns.