In Public Schools

from the "outside" looking "in"

Tightening The Belt

Posted by Admin On April - 9 - 2010

BELT-april06Schools across the nation find their tax dollars in shorter supply than they were a decade ago. While there are fewer students in many districts, the escalation of costs for the corporation continues. Every day you find school boards across the country making announcements of teacher layoffs, school program cuts and cutbacks of school services. However, many school corporations fail to identify the money pits of waste in their budgets.

One school corporation in Indiana had large numbers of teacher layoffs. At the same time, they interviewed to fill a position that required expertise in the area of insurance. The school board required an insurance licensed candidate to represent the school corporation.  The salary was higher than any compensation for the teaching professionals and three times that of a beginning teacher. Considering the high salary, you would believe that the job entailed selecting the right company and negotiating to receive the best price for the school corporation’s insurance. In reality, the teacher’s union was empowered with that position.  This representative simply explained the package to the staff once a year, made themselves available for questions and provided forms. Since every insurance company has a representative to do the same job, that’s why they get commissions, the need for this high paid position boiled down to providing forms, something that any clerical help in the main office could handle.  This is one example of misdirected funds.

The new superintendent of schools for Kansas City, Kansas, Cynthia Lane, identified the problems with the budget immediately. She organized a list of ways to save money without cutting the people directly in contact with the children. Her solution was to make changes to her office and reorganize to save money, reduce attorney fees, forestall equipment replacement and one other almost unheard of solution, lower her own wages.

Lane proposed salary cuts of three to five percent for everyone making over $67,000 a year in order to save money and provide much needed services.  However, to make certain everyone knew that she too was willing to suffer the cut; she agreed that if salary cuts occurred, the board should reduce hers by five to eight percent, depending on the plan chosen.  The reduction in salary of the highly paid, forecast to save that corporation between one-half million and three quarters of a million dollars.

Other corporations now institute practices once reserved for the private sector. Some of these corporations now look for leaks in their budgets. Some of these leaks involve the cost of utilities. Simply changing the light fixtures to more cost-effective ones is one method of corporations lowering their utility bills. Other ways they save is through an effort to make certain they receive the lowest price for those utilities and something as simple as turning out the lights at the end of the day.

Other schools, particularly smaller corporations, find that outsourcing certain tasks save them valuable dollars. In Minnesota, Fridley, Brooklyn Center and Columbia Heights are three smaller corporations that now look to a management service to replace the in-house business manager. This outsourcing costs close to half of the previous salary of their business manager and that doesn’t include the benefits the in-house manager received.

Budget cuts and rising costs may be a dilemma for many corporations but it also might be the turning point to identify the waste once accepted as normal for the business of operating a school corporation. It creates opportunities for corporations to focus on the glut and waste of earlier years and eliminate it.

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One Response to “Tightening The Belt”

  1. Thanks a lot you for this blog. Thats all I are able to say. You most obviously have crafted this world wide web into something speciel. You clearly know what you are working at, youve taken care of so many corners.kind regards

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