Gilroy
– School board trustees are asking for action sooner rather than
later on what could be a $1 million deficit in two years, and
Superintendent Edwin Diaz said he will consider imposing a hiring
freeze Monday.
By Lori Stuenkel
Gilroy – School board trustees are asking for action sooner rather than later on what could be a $1 million deficit in two years, and Superintendent Edwin Diaz said he will consider imposing a hiring freeze Monday.
After digesting Gov. Arnold Schwarzenegger’s final budget for the year, as well as some unanticipated costs – including a staggering workers compensation premium – Gilroy Unified School District officials and trustees say the time to look at cuts is now.
Last year’s budget remains to be finalized, but the estimate is that GUSD will have a $296,000 deficit going into the coming school year.
“I think it could get bigger before we close,” said Steve Brinkman, assistant superintendent of administrative services.
By 2006, GUSD is facing a hole of $905,000.
Schwarzenegger’s budget actually gives GUSD $206,000 more than it was expecting, money geared to bring low-paid districts closer to the state-wide funding average. The district is also saving $284,000 by buying rather than leasing five buses.
But when new GUSD expenses are added in – $460,000 in workers compensation, $425,000 in medical insurance increases – the district is left in the red.
Still, Brinkman urged caution during Thursday’s board meeting, saying the numbers are probably even more rosy than they should be.
“We’re in a situation here where we need to make some changes, because I don’t see this improving,” Brinkman said. “I think you need to be optimistic and I think you need to push the envelope, but there’s a whole lot of positives in here.”
Two of those positives are an assumed increase in attendance and flat medical benefits costs.
“It would appear that we have a problem, we just don’t know how big a problem it is,” Trustee Bob Kraemer said.
The answer, he said, could start with a hiring freeze imposed even before the final numbers are out.
“It can always be lifted,” Kraemer said. “It can be lifted a month from now, if we get shocked with some (positive) numbers.”
Board President Jaime Rosso joined Kraemer in asking Diaz to consider the freeze.
“It seems to me, we would start looking right now to make any stopgap measures we can take before things get worse,” he said. “We’ve cut, we’ve been reducing, and … we’re going to be impacting programs and the classroom.”
There are currently 10 job openings, from full-time classroom teachers to occupational therapists and a teacher mentor, listed by the district on an education job Web site.
The district spends 56 percent of its $65.6 million budget on contracted teachers’ salaries and benefits, and 82 percent of its budget on salaries and benefits for all employees.
“Monday, we’re going to discuss what type of hiring freeze or process that we will put in place in order to evaluate every position that becomes vacant and determine whether or not it should be filled,” Diaz said. “Immediately, we’ll start reviewing any vacant position or positions that become available.”
The freeze, if implemented, would come amid contract negotiations between the district and teachers for this year. Teachers received a 3 percent pay raise in 2003 but with the increasing cost of benefits, the district has said no more salary increases are on the horizon.
“I think it’s important that we gave teachers a raise, and that took a big chunk of money, but we didn’t plan on having some of these other things come up and now … we’re struggling to find the savings,” Trustee Dave McRae said. “I don’t see any other alternative. I think it’s got to be done, I think that some other savings are going to have to be found and found quickly, or we’re going to be in serious financial trouble in a year.”
Diaz told trustees Thursday he would investigate a hiring freeze, adding in an interview Friday that action now could save future cuts.
“Unless something dramatically improves, we’re going to be in another cost-cutting moment, and so reviewing all existing positions – even at this early point in the year – I think is wise,” he said. “We want to talk about … what current positions we have open, what classroom positions we have to fill, and whether or not they’re critical positions to fill.”
