The Oregon school board, by a vote of 3-2, on Tuesday renewed the contracts of several administrators earlier than planned, despite the anticipated loss of $3 million in revenue in 2013, and $11 million in 2016.
The reduction in revenue is due to lower property valuations, a tax appeal from Toledo Edison’s Bay Shore power plant, the partial closure of the plant, and a loss in “hold harmless” payments from the state.
Voting for the contract renewals were school board members Dick Gabel, Diana Gadus, and Carol Molnar. Voting against the contract renewals were board members Jeff Ziviski and P.J. Kapfhammer.
“Throughout the last several years, the amount of dollars that we collect has been reduced by over 12.3 percent,” said Treasurer Jane Fruth. “What that means is that back in 2007, one mill brought in $634,579. Now, one mill brings in $556,249. That’s significant. What that means is should we ever have to go for additional levy money, it will take more millage to bring in the same amount of money. That is something no one wants to hear it, but it’s where we’re at right now.”
So basically, in 2015, we’re going to be $3,391,000 in the hole in the negative. Then in 2016, we’re going to jump up to $11 million in the negative, unless a levy passes?” asked Kapfhammer
“Exactly,” said Fruth.
The district, she said, cannot legally have a deficit.
“It’s illegal for us to be in the red, so we’ll have to take care of that before 2015,” she said.
Gabel, who voted to renew the contracts, said that the district is doing better than other school districts in the area.
“Other schools in the area are in as bad of shape if not worse than ours,” said Gabel. “We’re doing fairly well compared to what it could have been.”
Kapfhammer and Ziviski were opposed to the contract renewals because of the district’s anticipated revenue loss.
“Nobody really knows how we’re going to fix this,” said Kapfhammer. “But we are deciding to renew people’s contracts a year and a half ahead of time for the stability of this district. Everything we’ve talked about so far is how unstable this district is going to be in the next three or four years. I haven’t heard anything that gives us a solution. We’ve never as a board discussed renewing contracts a year and a half ahead of time. Everybody talks about transparency – knowing what’s going on - in this district. This agenda was released to us on Friday afternoon, with no school on Monday. I’ve been on this board for a month and a half. And I’m now supposed to jump the gun and renew people’s contracts ahead of time when they’re still under contract. Even though we sat here talking about the doom and gloom, the millions we’re going to be behind, the tens of millions in the years to come, our solution in this district is to renew administrators’ contracts a year and a half ahead of time so they have stability, so they don’t leave this district. I can tell you right now, as I said with the raises, if you’re not stable here and you don’t like working here, and if I don’t renew your contract, you’re going to leave, the door is right there.”
Kapfhammer was referring to the school board’s approval of salary increases for administrators last year, including a $13,000 raise for Zalar. Kapfhammer and Ziviski campaigned last November in opposition to the raises in light of the board’s elimination of bus service for Clay High School students. The board later agreed to pay for a bus shuttle for the students.
“In three years, when we’re cutting all these teachers’ jobs and bus drivers’ jobs, and we’re cutting everyone to pieces again, we’re all going to forget about today. This is definitely something that should have been discussed by this board ahead of time to give our residents, who we work for, the right to ask questions. This is exactly what’s wrong with this board. I’m adamantly against locking in our district in millions of dollars in contracts, knowing we’re going to be in negative money,” said Kapfhammer, to a burst of applause from the audience.
“I’d like an explanation how this benefits the district, because all it does is lock us in,” said Ziviski. The contracts represent a cost of over $800,000 per year to the district, he said, “when we just lost that much.”
“They’re going to walk either way if they find another job, then it will be up to us to fill that position. If we have to get rid of them, we have to pay them out. So we’re locking ourselves in. That money could go to textbooks and the education of our kids,” said Ziviski.
“This is just a change back to past practice,” said Zalar. “This is a routine recommendation. This is an attempt to try and provide some stability in the leadership positions throughout the district to demonstrate by this board of education that it appreciates and respects the work that these administrators do. The approval of these contracts has absolutely no ramification on the future impact by district finances.”
Zalar said administrator positions will not be protected from future budget cuts.
“The board’s hands are not tied in any form or fashion by approving these contracts. These administrators have all had satisfactory evaluations, their performance has been exemplary. This is in accordance with the Ohio Revised Code that makes the provision to approve administrator contracts the year prior to their expiration. I’ve provided that information to the board. I can only ascertain that the questions pertaining to this are politically motivated. Let’s be honest. There’s been a lot said about administrative raises. This has absolutely no impact on that particular board’s decision that was made last year,” said Zalar.
“We don’t know each month if we are going to have more things happen financially to the district,” said Ziviski after the meeting. “We need a more flexible system in place so we can adapt to any curve balls thrown our way financially. We just now entered into contracts totaling $800,000 per year that we’re legally bound to pay for the next five and a half years. That’s my biggest concern.”
He also said he didn’t think the board was treating employees the same in renewing the contracts. Some contracts were renewed a year and a half before they were set to expire, while others were renewed six months in advance.
“My concern on the contracts is that we’re identifying different groups of employees and treating them differently. In my eyes, everyone in the school district should be treated in the same consistent manner with no favoritism shown to any group of employees. All the employees in the district should be valued the same,” said Ziviski.