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Ramona school district unveils 5-point proposal

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By Maureen Robertson

Ramona school district’s debt, the framework of a bond on the November ballot, employee salaries, class size, property values, healthcare costs, test scores, closing a school, year-round school, busing strategy, selling district

property, more efficient use of school buildings in light of continued declining enrollment, local control versus state takeover, and better communications with the public kept the conversation flowing at the community workshop on Saturday morning.

In a 20-minute presentation during the 90-minute meeting, Superintendent Robert Graeff outlined a potential five-point plan for putting the district on the path to long-term fiscal health:

•Acknowledge an improving state economy and the governor’s budget proposals,

•Sell two district properties,

•Continue to reduce staff as enrollment declines,

•Eliminate the debt with a general obligation bond in November, and

•Maintain lower healthcare costs.

“If any one of those things doesn’t happen, the plan I described to you becomes complicated,” said Graeff.

Without a plan, the district faces a possible $7.3 million shortfall in 2015-16.

“Under the law, we cannot operate this way...you have to have a positive ending balance or there’s a whole procedure where somebody else comes in and runs your school district,” Graeff said.

How did the district get here? Continuing fiscal challenges he listed include:

•Declining student enrollment. In 2002-03, the district had 7,247 students. This year, enrollment is 5,731. The initial projection for next year is a drop of 100 to 150 students.

•State funding for education dropped from $50.34 billion in ‘07-08 to $42.58 billion in ‘11-12. If the Legislature approves Brown’s proposal, the district could receive $2 million to $2.5 million more a year.

“It’s the governor’s goal that by the year 2020 public schools will receive that same amount of money they received in 2007-08,” said Graeff.

•Increasing healthcare costs. In 2001, the district paid an average of $5,537 per employee participating in the benefit plan. In 2013, it is $15,145. Until last year, the district paid 100 percent of the employees’ premiums. Of the district’s $5.5 million healthcare cost this year, employees contribute about $650,000, or 11.8 percent, Assistant Superintendent David

Ostermann said.

•Negotiated salaries that include annual increases based on years on the job and a satisfactory evaluation. This increases district costs 1.5 percent to 2 percent, or $450,000 to $600,000, a year, said Graeff.

“These are not raises,” he said. “It’s a sensitive difference.”

This year, 47 percent of Ramona teachers received an increase, as did 28 percent of support staff and 25 percent of managers, he said.

•Long-term debt due to a $25 million loan called certificate of participation (COP) in 2004. The district received $34 million in matching funds and with the $59 million built Hanson Elementary School and the new Ramona Community School, added classrooms to the middle school and modernized Ramona High School, said Graeff.

The district re-financed the loan in 2007, when the principal was $24.3 million and interest was about $27

million. The plan was to use developer fees until payoff in 2032, but “the housing boom busted,” and starting in 2014-15, payments will come from the general fund, Graeff said.

“By 2032, assuming we make all the payments on time, we’ll have paid $51 million,” he said, noting that paying it now would be $34 million.

“The bond is going to be a real, real hard sell,” said resident Mischa Dobrotin. “There’s a lot of resentment about this COP and the way it’s been handled.”

“Nobody wants to pay for this, but we all have to pay for this,” said Connie Phillips, a mother whose sixth-grade son is in a class of 38 students and said she will “go door to door” in support of a bond. “I think our community will have to take this hit.”

The amount of a potential bond, what it would pay for and how it would be structured are unknown. The district

is interviewing possible bond consultants and a recommendation likely will go to the trustees on Feb. 13.

Patrick Meskell of the Edward Jones financial and investment office in Ramona said his firm underwrites municipal bonds.

One of the things that might improve the possibility of passing a bond is “who’s going to own these bonds,” he said.

“Local people can own those bonds and that just might be one of the things that helps gets you across that extra 4 percent,” he said, referring to the district’s failed bond attempt in 2012.

According to the county registrar’s office, 15,288 Ramonans voted in the 2012 bond election, with 50.61 percent in support and 49.39 percent against. To pass, at least 55 percent yes votes are needed.

Responding to J. Dyer’s question about why state takeover is a bad thing, since the district takes its orders from the state, Shelly Yerkes of the Ramona Parents Coalition said, “when your district goes under and the state takes over and you start losing those quality programs and you start losing the quality of teachers, then the whole

community is going to start degrading.”

While the district must comply with state law, a school board can set local policies that mirror the values of the community, trustees Dawn Perfect and Bob Stoody said. With state takeover, a state-appointed administrator runs the district and is only accountable to the governor, said Graeff.

Dave Patterson suggested cutting administrative costs and salaries “and as a last resort reduce the salaries of our teachers to stay within budget.” Yerkes agreed “as long as we can maintain competitiveness so we can continue to draw quality teachers.”

Trustee John Rajcic suggested closing a school, saying, “We have capacity for 9,000 students. We have 5,700 students.”

Several of the 40 people at the workshop discussed several options and the impact it would have on transportation costs and students. Yerkes called closing a school “the elephant in the room” and asked for more details.

“I may say, yeah, maybe it makes sense, but it’s a big maybe,” she said. “I think it would behoove you to actually publish some information showing how much it would actually

cost to close a school and redistribute the students.”

School bus driver Betsy Bargo suggested reorganizing bus routes to be more cost-effective, and her husband Brion said that to pass a bond the board needs to “convince the community that you’re able to make hard decisions and that those decisions are necessary.” His examples were closing a school or a year-round schedule for one or two schools.

“Bottom line, there aren’t very many school districts in California that have quality facilities and quality things for kids unless they passed a bond, unless they passed a parcel tax (requires two-thirds voter approval),” said former Ramona school administrator Bobbie Plough.

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