Manchester Essex Regional School District Budget Workshop January 19, 2010

1. Manchester Essex Regional School DistrictBudget WorkshopJanuary 19, 2010

2. Our FY11 Fiscal Challenge Increased costs of doing business • Health insurance • Increased special education out of district costs • Increased student enrollment • Negotiated salary increases • Utilities for larger building (2times square footage) It costs more to deliver the same educational services as we did last year

3. Financial Trend: Escalating Costs & Declining State Aid • Mandated spending, contractual obligations driving annual budget increases • State funding cuts reflect deteriorating economy *State Aid = MERSD’s Chapter 70 and Regional Transportation Revenue

4. Special Education Costs Outpacing Reimbursements *FY-10 Budget included DESE’s original Circuit Breaker reimbursement estimate of $441K and operating expenses of $990K. **FY-10 Forecast includes revised DESE Circuit Breaker reimbursement estimate of $237K and operating expense of $1.28 million

5. The Dilemma • FY 11 Level Service Operating Budget - $20,765,538 • $1,871,134 (9.9 %) increase over FY 10 • Over 12% increase to town assessments • Recognizing towns’ funding constraints while holding onto district goal to maintain educational program, district has worked to target reductions • Reductions needed to reach • 5.0% $1,228,200 • 4.5% $1,308,899 • 4.0% $1,389,598 • 3.5% $1,470,297 • 3.0% $1,550,996

6. Working towards the Solution • Use additional reserves $567,500 • School Choice, E&D, Stabilization • Reduce salaries $386,000 • Eliminate/combine positions • Reduce expenses $265,000 • Reduce instructional supply, curriculum, professional development and technology budgets • Increase revenues $171,500 • New/increase fees for athletics, busing, student parking; additional School Choice students Total Savings $1,390,000 – 4%

7. Beyond the 4% Reduction • A reduction to 3% means an additional $160,000 beyond the $1.4 million in cuts identified • Additional cuts will mean critical losses to educational programs Items under consideration include: • Reducing kindergarten to half day for all (eliminate full day) • Restructuring/eliminating elementary specialists (possible 4.5 days per week model) • Concessions (salary, health insurance, etc.) from administrators, support staff and META* *Subject to negotiations

8. Kindergarten Options • Current Full-Day Kindergarten (FDK) Program: • Puts all students on trajectory to continue MERSD’s tradition of academic excellence • Estimated program cost: $370K • Budget Option 1: Introduce tuition for current full-day program. • Benefits: retain academic rigor and subsidize investment in program which currently exceeds State/Federal guidelines • Drawbacks: • Additional ½ day option needed for families choosing not to pay tuition for FDK • 50% avg. sign up rate in MA for tuition K, suggests wider range of student readiness for 1st grade • Potential incremental revenue: $140K • Budget Option 2: Eliminate FDK, return to Half Day Model • Benefits: similar savings with consistency of academic program across grade level • Drawbacks: major set back to MERSD’s academic preparedness strategy • Potential savings: $160K • Administration Recommendation • Retain FDK, and seek savings with lesser impact to academic program • Rationale: benefits of modifications likely outweighed by significant impact to student readiness

9. Reallocation of Administrative Resources 2010-2011 High School – Principal Jim Lee, Assistant Principal Paul Murphy Middle School – Principal Beth Raucci (with support from Paul Murphy) Memorial School – Principal Beth Raucci (with support from Jen Roberts and Scott Morrison) Essex Elementary School – Principal Jen Roberts Director of Curriculum and Instruction – Scott Morrison

10. Roles and Responsibilities • Middle School Principal – Beth Raucci • Office located at Middle School • Primary contact for Students, Staff, and Parents • Instructional Leader/Middle School Philosophy Support to Middle School Principal – Paul Murphy/Middle School Team Leaders Serve in Assistant Principal role at MS/HS Supervision in hallways/dining hall Team Leader concept model

11. Roles and Responsibilities • Memorial School Principal – Beth Raucci • Primary office located at Memorial School • Primary contact for Students, Staff, and Parents • Instructional Leader Support to Memorial School Principal- Scott Morrison and Jen Roberts Assist with observations/evaluations of staff Provide support to on-site teacher “substitute principals” in Principal’s absence

12. Plan Designed to Foster Schools/District Goals • School/District Climate Task Force K-8 • Vertical and Horizontal Articulation Literacy and Science K-8 • School Improvement Plan Goals Middle School Initiatives Memorial School Initiatives • Parent Involvement – School Improvement Councils, PTO’s, etc.

13. Conclusion • Current status at 4% reduction represents considerable loss to schools with the $1.4 million cut • Administration strongly recommends to School Committee not to go beyond 4% at this time - talks with towns and Association ongoing - further cuts, if needed, would significantly impact quality of school district • Beyond addressing the significant gap this year, need to look at multi-year strategy for cost containment while continuing to maintain quality of academic program