That was the message from Governor Pawlenty, and echoed and reinforced by House Speaker Margaret Kelliher (DFL- Mpls), Senate Majority Leader Larry Pogemiller (DFL- Mpls), Senate Minority Leader David Senjem (R – Rochester) and Representative Pat Garofalo (R - Farmington), who was representing the House Minority Leader Marty Seifert, to a meeting of invited leaders of the major public school education groups (including MACS) last Friday (January 9th) in the Governor’s Reception Room.
During the meeting a somber and serious assessment of the growing financial crisis was presented. It is the worst financial crisis in state history and was described as a “dire” situation that could become “extremely dire”, as no one know how worse it still is likely to become. The assessment included news that the deficit is growing faster and could be another billion or more by the time of the next financial forecast in February, that Minnesota is losing more than a 1,000 jobs a week and that is expected to continue through all of 2009, and that Education will not be spared in the budget cuts as education is more than 40% of the state budget. The Governor and Legislative leaders asked for ideas on how things could be done differently that would make the system work smarter, save money and be more effective. There were a number of ideas identified, including mandate reductions to provide schools with more flexibility in terms of both what they have to do and how they do them.
COMMENT:
The financial situation in the country and state is going to impact every person and institution, and every day it worsens, the larger the impact will be. The projected state budget deficit is already projected at 15% of the total budget for the next two years. If it grows by another billion it will be 20%. Given that 40% of the state budget is education funding, a 15% - 20% shortfall in the state budget cannot be addressed without cuts in education.
Every school is going to have to take a hard and serious look at how it fulfills its core mission and functions and its cost centers. For schools which are labor intensive organizations - labor costs average over 70% of operational costs – that means finding ways to reduce labor costs through new and creative ways of staffing, freezing personnel expenses or cutting personnel if the school is actually going to be able to absorb the reductions.
In a time of rapidly growing unemployment, one would hope that folks would understand that a job with no pay increase, maybe for the next couple of years, or even a job with a cut in pay is better than no job at all. Schools need to begin what will likely be hard, and at times painful discussions on how to provide better and more effective education with reduced resources. In December, I wrote to school directors suggesting that they do budget planning on the basis of at least a 5% reduction in overall income. Based on the financial projections of the state, that may be conservative, but it is a starting point for the critically important discussions that need to be taking in every school and school board now.
NOTE:
As for MACS, we understand the ripple effect and impact that cuts in school budgets will have on the Association - I have already notified our two other employees that none of us will receive raises next year. In February, I will be presenting recommendations to the MACS Board of Directors with options on what the Association needs to do to refocus our mission and functions in terms of the current economic realities… more on this in the next issue of the MACS TODAY newsletter later this month.
Eugene Piccolo