Storm Lake Community School District this week cited harsh economic times as they responded to the Storm Lake Education Association's request for 2009-2010 - offering a pay increase far below what educators had sought.
The two groups return to the table in closed session Wednesday to begin negotiations.
SLEA had asked for a 6.47% raise in a package that would cost the district $607,396.
The district counter offers a 1% raise - $62,995 for salary schedule changes or increases and $31,066 for anticipated IPERS, FICA and LTD increases. The district proposes no change in contribution towards staff health insurance.
The district "must be more conservative in planning and actions for the upcoming school year... the District Board of Education believes today's economy and the outlook for the future requires immediate careful future planning to avoid ending up like other area schools last spring that faced huge reductions and/or changes," officials cited as the reason for the modest pay hike.
Recently, Gov. Chet Culver, gave a budget proposal that calls for the state to actually fund only 2% of the 4% allowable growth for schools, and to continue a 1.5% across-the-board cut for the next school year, district officials related.
If these budget recommendations are enacted, the Storm Lake Community School District projects that it will be short approximately $400,000 to $500,000 in anticipated revenues for the 2009-2010 school year.
District officials also note that they must fund programming for the Charter School program, which has many students attending five years of high school-community college instead of the traditional four years. The number of charter students has increased from 59 students in 2007-2008 to 89 students in 2008-2009.
"The Storm Lake Community School District has to account for the expenditure of the Charter student funds for tuition, transportation, instructor fees and other expenses... to include Charter student generated money in our negotiations is to further complicate our ability to present a balanced budget that includes a means to increase the Ending General Fund Balance," Superintendent Paul Tedesco said.
The district has a goal in place to expand the ending balance to $2 million to protect the district from having to borrow in periods of low revenue or unexpected costs.
In seeking to balance the budget for the coming year, "employee salary and benefits must be taken into account," he continued.
Salary and benefits consumer 81.33% of the anticipated expenditures for this year. This estimate includes employees that are contracted from another agency such as nurses and Iowa Central staff. Each percent of increase in employee pay would cost the district about $168,595.
In their counter-proposal to the teachers, the school board reserves the right to move dollars within the package it has proposed, which will happen if insurance costs increase.
The District is aware that the IPERS year and the employee contract year are not the same. However, the District is willing to absorb the IPERS increase for July and August of 2009 - about $3,700.
Last year, the Storm Lake Community School District and the staff had to assume greater risk and/or exposure in order to keep the health insurance premiums the same from 2007-2008 to 2008-2009. The district is hopeful that a premium increase can be again avoided.