The Cherokee School District's Licensed Employee Voluntary Early Retirement package became the victim of the State's recent 10-percent across-the-board budget cut after a 4-1 vote by the Cherokee Board of Education at its regularly scheduled meeting Monday night.
The Board rescinded Policy 407.6 on the recommendation of Superintendent Dr. John Chalstrom, and despite an impassioned plea from Board member Larry Goodrich, a retired Cherokee teacher and coach who, himself, took the early retirement package several years ago.
In essence, that package included a $20,000 payout, plus an estimated health insurance benefit of $3,800 per year to age 65.
Employee eligibility requirements included:
*Be a teacher or administrator with a certificate of good standing with the State of Iowa.
*Have completed at least 15 years of service to the Cherokee Community School District.
*Years of service shall include only those years in which an employee held a contract to teach under Schedule A or an administrator's contract.
*The last 10 years of service must be continuous employment.
*The person must be currently under contract with the District and not received a notice of staff reduction or notice of termination prior to submitting the request for acceptance of resignation.
*The person may not be on an extended unpaid leave of absence at the time of submission of the request for acceptance of resignation and election to receive the benefits of early retirement.
*The retirement of an eligible employee cannot become effective before the employee's last contracted day.
Also in the Code 407.6, it reads, "The Board shall review this policy annually and reserves the right to make changes to the policy at any time. Although it is the intent of the Board to maintain an early retirement incentive, it has discretion to offer or not offer an early retirement program for licensed employees."
Providing all other criteria was met, a licensed employee could submit a request for the voluntary early retirement package after their 55th birthday effective July 1 of the retirement year.
Monday's Board action becomes effective next school year, 2010-2011.
Chalstrom explained to the Board that the early retirement incentive is basically a management tool that allows the District a means to replace top salaried employees with entry-level employees at the low end of the salary scale, thereby saving the District considerable money without impacting the general fund.
Chalstrom said there were 13 licensed employees in the District that are eligible for early retirement this year, but reiterated that the policy is voluntary and not all employees choose to take the package.
"These are perilous State budget times," noted Chalstrom, "and from all indication they are not going to get better, and may even get worse in 2011, 2012. There's talk that the Governor will make another 5-percent ATB cut in January."
Based on the recommendation by Chalstrom at last month's meeting, the District will make mid-year reductions totaling $129,200 in an effort to counter a portion of Iowa Governor Chet Culver's 10-percent across-the-board (ATB) State budget cuts that ended up costing the Cherokee District $492,000 less state aid revenue.
According to Chalstrom, the mid-year reductions of $129,200 will subtract from the $492,000 hit from the State-level budget cuts, leaving the District with the need to draw $362,800 from its $900,000 cash reserve fund.
"It is particularly difficult for school districts to absorb such a loss mid-year," noted Chalstrom at that time.
"Budgets have been set, collective bargaining agreements are in place, and the majority of purchases, (i.e. textbooks, technology, curriculum), have already been made. When faced with a reduction of this magnitude, school districts have few options to cope with the loss of revenue other than using cash reserves."
Chalstrom said in the coming budget year (FY 2011), the District will use its spending authority to implement a cash reserve levy to help replenish the expended cash reserves.
Of those $129,200 in mid-year reductions, $30,000 will come from not replacing a custodial vacancy, $15,000 in other personnel savings, $78,000 in ARRA Funds (Federal stimulus monies) now to be applied to the General Fund, $1,200 by not attending the School Administrators of Iowa (SAI) State Convention, $2,000 in not attending the American Association of School Administrators (AASA) National Convention, and $3,000 in not installing a proposed e-mail server.
In addition, Chalstrom said the District will closely monitor overtime hours and any purchase requests, and begin examining energy conservation efficiencies.
Monday's 4-1 vote rescinding the Early Retirement package showed Board members Deb Johnson, Jack Creel, Terri Weaver and Laura Dawson voting for the move, with Goodrich voting against it.
Chalstrom said the Superintendents of all Lakes Conference schools with such a policy are now seeking to rescind it.
"We're at that point (with budget cutting) where there are no good decisions," added Chalstrom. "We must do what is necessary to make our budget work out."
In other action, the Board approved the resignation of Mike Rundall as 8th-grade football coach pending finding a suitable replacement. The Board also approved a contract for Jon Larson as freshman girls basketball coach, and for Tim Stoneking as assistant basketball coach for both boys and girls grades 7-8.
The Board also approved contracts for Rachel Mallory and Cory Koster as special education associates at Roosevelt Elementary School.
An application for renewal of cooperative sponsorship of an activity between the Storm Lake and Cherokee districts also was approved for boys swimming. Girls swimming is already in effect.
The Board also approved a travel request to Minneapolis for two WHS and two CMS choir members, to be accompanied by vocal instructors Amy Sarchet and Kristine Zylstra.
WHS Principal Larry Hunecke also advised the Board that the parent turnout for the recent WHS parent-teacher conferences were "really horrible and worse than usual." He estimated that the average was about 12 conferences per teacher, and questioned whether moving the conferences' times from 2-6 p.m. to 4-8 p.m. would help the situation.
Both Chalstrom and Hunecke agreed that the person to person contact between a teacher and parent is critical and every effort should be made to increase attendance. It also was mentioned that the fact parents can now access their child's grades online may also be affecting conference attendance.