By Charles Sercombe
Hamtramck Public Schools are facing a few years of financial crisis, but at least there’s a plan to get the budget balanced.
In fact, it’s a five-year plan.
The School Board agreed last week to adopt a deficit reduction plan that was proposed by the district’s director of finance, Glenn Pasternak. Pasternak said the plan requires concessions from the district’s two unions.
The district is facing a $3.8 million deficit in the next three years and is mainly looking for its employees to agree to kick in 25 percent of the health care costs. Pasternak conceded the contract concessions might not go over easy.
“There’s going to be unhappy people,” he said.
The president of the district’s teachers’ union, Bo Karpinsky, said he’s willing to listen to the proposal but wouldn’t say what he thinks about it.
Karpinsky said he’s not surprised the district is asking for concessions.
“We saw it coming,” he said.
Karpinsky lashed out, however, at Blue Cross for raising management fees by 30 percent.
Pasternak said he’s trying to avoid salary cuts. He warned, though, the state might make deeper cuts in the student financial aid it sends to each district. Pasternak said the state might reduce what it pays per student by another $300 to $500.
The state is already reducing what it pays per student by $165 and it may very likely add on another $127. The cuts translate into a loss of $600,000 to the district.
Gov. Jennifer Granholm is urging state lawmakers to raise some taxes to save funding for education but Republican legislators have so far blocked any increases. The state is facing a $2.8 billion deficit.
Michigan is in the midst of one of the worse economic downturns since the Great Depression. During the last 10 years the state has lost one million manufacturing jobs – jobs that paid well and through taxes helped keep the state solvent.
Besides cuts in state financial aid, Pasternak said the district has been hit with steady increases in health care costs. He said in the 2006-’07 school year, health benefit costs rose $3 million and will continue to increase by another $1.3 million this school year.
While state financial aid has been reduced and the cost of benefits has risen during the past few years, Pasternak said there have been no “major” contract concessions by the unions.
Hamtramck is not alone in its financial struggles. A number of districts in the metro area are laying off teachers and employees and closing schools.