The Hollister School District has prepared an answer to numerous
questions circulating about why the district won’t agree to a
salary increase with its 335 teachers.
The Hollister School District has prepared an answer to numerous questions circulating about why the district won’t agree to a salary increase with its 335 teachers.
In a three-page letter addressed to parents, staff, students and the HSD community, Superintendent Judith Barranti discusses the state budget crisis, decreasing student enrollment and the district’s financial picture. Because the district is looking at deficit spending, Barranti said, it will need to hold onto its reserve as well as an additional $3.7 million.
“Since the development of the ($40 million) budget (for 2003-04), additional medical insurance costs, a decrease in enrollment and a decrease in student attendance has caused us to incur unanticipated deficit spending,” Barranti said in the letter. “We anticipate we will spend more than $43.5 million this school year.”
The deficit spending of $3.5 million is similar to the $3.7 million the district has in addition to the state-mandated 3-percent reserve fund.
Howard Madden, president of the Hollister Elementary School Teachers Association, couldn’t comment on the letter because he hasn’t seen the numbers Barranti refers to. Throughout negotiations, the teachers union was given no indication the district would come up short this school year, he said.
“I need to see the numbers that show how we got into this kind of debt,” he said. “How, all of a sudden, did we get this bad off?”
To explain the district’s negotiations with HESTA, Barranti cites past salary hikes of 32.37 percent over seven years and the cost of insurance benefits increasing 123 percent over the past seven years.
“During the negotiation process, the district has offered HESTA a 2-percent increase in salary, two different ways, despite the pending economic uncertainty,” Barranti states in the letter. “Each of these offers carried a co-pay by the employee for their family health insurance coverage.”
HESTA members have argued that a 1-percent raise for HESTA’s 335 teachers would amount to $215,000. The teacher contract expired last June 30 and teachers are asking for a raise – they did not receive one last year.
On top of huge health insurance increases plaguing employers across the state, the HSD also has less students enrolled and less attending school everyday, which affects state funding in the form of Average Daily Attendance. Most of the district’s funding comes from the state, Barranti said in the letter.
Fall enrollment at the district is 6,181, down from 6,235 last year, according to the San Benito County Office of Education. Average daily attendance is also down to 5,939 for the fall – dropping from 6,004 the same period last year. The percentage of average daily attendance is 94.87 of those enrolled, down from last year as well.
“Over the past 20 years, the Hollister School District enrollment has increased an average of over 4 percent per year,” the letter said. “Based on our substantial annual growth rate, the district budget was based on 3-percent growth for the 2003-04 school year.”
Community members will receive the letter sometime next week, Barranti said. She is asking for any “thoughts and suggestions about ways to reduce spending and/or save money.”
The next district Board meeting is Feb. 24 at 6 p.m. at the district office, 2690 Cienega Road.
February 2004
Dear Parents, Staff, Students and Hollister School District Community,
The purpose of this letter is to provide an update on the status of the school district budget for the 2003-2004 school year. I will be providing updated information as the budget process continues.
State Budget Crisis
The State of California has experienced an unparalleled downturn in the state economy. The governor has stated that he expects the state budget deficit to be in excess of $36 billion dollars. Because the majority of our funds come from the state, our school district budget will continue to also be negatively impacted by the state crisis. When the state budget is reduced, school district revenues are also reduced. The State of California provides approximately $4,500 per child (known as the “Revenue Limit” for elementary school districts) for the school year. This ranks California as 31st for state and local education spending per capita (reference: The Public Policy Institute of New York State, Inc.). That is well below the national average especially considering California is the sixth largest economy in the world.
Even though the governor has presented his budget proposals for the 2004-2005 year, the legislature has yet to adopt the budget. Furthermore, the proposed state budget is contingent upon the passage of two state initiatives. This approval process has extended past the June 30 deadline for the past several years. This also makes planning the district budget for next year very tentative and difficult.
Enrollment
Over the past 20 years the Hollister School District enrollment has increased an average of over 4 percent per year. Based on our substantial annual growth rate, the district budget was based on 3 percent growth for the 2003-2004 school year. During the first quarter of the school year, we have experienced a decline in enrollment. We have fewer students this year than last year. The economic slowdown and cost of living in Hollister have contributed to the current enrollment situation. We will be taking a very conservative position relative to enrollment projection in planning for the 2004-2005 school year. This means planning for less revenue to the district.
Districts are funded on student attendance. When students are not in school (for any reason) the district does not collect revenues for that student for days missed. Our attendance rate thus far this year is 94.87 percent. This is also down from last year, resulting in more lost revenue.
Current District Financial Picture
Hollister School District adopted an annual budget this year of just over $40 million dollars. This budget was developed on the best information we had at the time. Since the development of the budget, additional medical insurance costs, a decrease in enrollment, and a decrease in student attendance has caused us to incur unanticipated deficit spending. We anticipate we will spend more than $43.5 million this school year. The Hollister School District has been extremely responsible in its budget projections, and therefore has been able to retain a limited reserve while other districts in California are facing greater financial difficulties. This reserve (approximately $3.7 million) will cover our deficit this year and will help next year. Even at that, we anticipate we will need to make cuts in our expenditures for next year.
Negotiations with the Hollister Elementary School Teachers Association
During this school year, Hollister School District has been in negotiations with the Hollister Elementary School Teachers Association (HESTA). At our last meeting, the district and HESTA agreed to go to Impasse. Impasse is an activity that refers to a point in the negotiations process where both sides agree that they cannot come to a settlement. The only issue causing the District and HESTA to be at Impasse is the dispute over salary. The District and HESTA have reached agreement on many other issues, including catastrophic leave.
Over the past seven years, the District has provided the teachers with salary increases of 32.37 percent. These salary increases are in addition to an increase in family health insurance benefits, and salary schedule (step and column) increases, which were also paid by the district. Teacher salary increases alone are greater than the increase in the Cost Of Living Adjustment or COLA (25.59 percent) that the district has received over the past seven years. In addition, our full time employees receive full medical, dental and vision insurance for themselves and their families. The cost for these family health insurance benefits has increased an astronomical 123 percent over the past seven years.
During the negotiation process, the District has offered HESTA a two percent (2 percent) increase in salary, two different ways, despite the pending economic uncertainty. Each of these offers carried a co-pay by the employee for their family health insurance coverage.
Budget Development Process for 2004-2005
Even though the governor has offered his budget plan for next year, his plan is based on major bond measures that affect education funding. If the state’s proposed initiatives fail, state sources have informed districts that there could be even greater negative consequences for all school districts’ in the state’s May budget revision.
We will begin our 2004-2005 budget development process using fiscal and historical assumptions. Since this year we are spending more money than we are bringing in, we anticipate we will need to make reductions in our expenditures for next year. I welcome any thoughts and suggestions about ways to reduce spending and/or save money. Please send or deliver them in writing to any school in the Hollister School District, or send them directly to the Hollister School District Office, 2690 Cienega Road, Hollister, Calif. 95023.
Community Support
On behalf of our schools and our students I want to thank each of you for your continued support. I also want to acknowledge and thank all of our Parent Clubs, School Site Councils, and many local agencies and businesses that have been working together to help provide support for our programs and provide services for students.
Sincerely,
Judith Barranti, Ed. D.
Superintendent
