How to Reform Your Local School Board
by Steve Loehrke, Weyauwega, WI
July 2005

I have been the President of the Weyauwega-Fremont School Board for the last four years. I own a small realty and appraisal company,a small computer, and Internet website development company. I recently founded a non-profit charitable corporation to help underprivileged children in Wisconsin. I serve on the school board primarily as a concerned parent of school aged children and as a taxpayer

I always tell my employees “Don’t bring me a problem without bringing me at least two possible solutions.” So I’m going to tell you what I perceive to be the problem and give you some possible solutions. Some people perceive the problem to be not enough money for education and their only solution is to dig deeper into taxpayer’s pockets. From where I sit, the problem is “How do we maintain or improve the quality of education in Wisconsin while controlling the current and future costs to taxpayers?”

Most people associated with schools in Wisconsin are worried about some type of tax freeze because they think it will limit the money available to schools. I am not. Here’s why: Historically, school districts budgeted for what they thought they would need to run their respective district and raised taxes to match. Then, around 1993, as part of the QEO law changes, the State of Wisconsin established revenue caps. So instead of a bottomless billfold, school districts suddenly had a fixed amount of taxpayer’s money placed into their billfold each year. They had to learn to spend no more than they made, just like most people with regular jobs. However, instead of learning to do with what was available, school districts did things like promote referendums to exceed the revenue cap.

Before I got on the Board, our school district tried three times until they finally received voter approval for a referendum. When I got on the Board, I was told that our district would have to plan for another referendum when the existing one ran out in order to keep our district afloat. Demographics showed that our school district would be switching from an increasing enrollment to a declining enrollment. I have observed that an increasing enrollment hides many financial problems while a declining enrollment emphasizes the problems. Our school district had been running deficits budgets and was depleting its fund balance to pay regular expanses. Our mill rate was one of the highest in the area. Our administrative overhead was one of the highest in the county. Our employees’ health insurance costs were one of the highest in our neighborhood. Our post retirement costs were the highest in our conference. Yet, everyone said they expected another referendum to sustain the bloat. No one wanted to tighten the belt.

Before I got on the Board, I did not have any idea of the extent of the problems. I heard that the two larger schools on either side of our district had each had referendums to build new high schools and that they expected to divide the spoils of our district when our school district ran out of money to operate independently. I should have expected something when the other Board members elected me President within the first five minutes of my first Board meeting. This prevented me from being indoctrinated into the old ways of school districts. So I plunged into my job on the Board. I was told that we must approve a deficit budget for the next school year. There was a long range planning committee that was recommending another referendum to stay afloat. There was talk of closing one of our grade schools. I was opposed to all of these proposals. So I researched the problem. In my first few weeks, I went to 19 meetings and training sessions – plus listened to ex-Board members, teachers, staff, retirees, students, taxpayers, Wisconsin Dept. of Public Instruction (DPI), and the Wisconsin Association of School Boards (WASB). Then near the end of my first month on the Board, the Sunday Appleton Post-Crescent ran another editorial which included the words “financially troubled Weyauwega-Fremont school district”. This had been a common theme in many previous articles. On Monday morning, I called our Business Manager and our District Administrator and told them that they must fix their proposed deficit budget before our Board meeting on Tuesday, or I would fix the deficit and they might not like my plan. I emailed them my ideas. By noon, they called me back and we had a balanced budget. By the end of the year we put more money back into the reserve fund than the extra money received from taxpayers under the referendum. The next year we paid off all school constructions loans except one loan that we refinanced at less than two percent interest. In year three, we paid off our WRS “prior service” loan. We eliminated all short term borrowing.

With proper management, our school district has now had a balanced budget for four years. Four years ago our mill rate of $12.02 per thousand was 43 percent higher than the current rate of $8.38. In the same time frame, the equalized valuation of the taxable properties in our school district has gone up 31 percent while the actual amount of local property taxes collected for our school district has gone down 9 percent. Our mill rate decreased from the highest of all contiguous school districts to the lowest. We now have more money in our reserve fund than the balance of our only remaining loan. Therefore, we are effectively a debt free school district.

I have a whole list of things we did to balance our budget. For a few examples, first we reduced administrative overhead. Then we combined non-union jobs. I assigned myself to be head negotiator for the district in its union negotiations. We did not implement the QEO. We actually raised the wages of our teachers to one of the highest of our comparable school districts. We kept all class offerings except Driver’s Ed which was available privately. We kept all extracurricular athletic and academic activities. None of our schools closed. When I researched comparable school district’s budgets, schedules, and union contracts, I found out that many other districts could do the same things we have done. The details of all the things we did to move our school district from a financially troubled district to a debt free district would take hours of discussion. My point is that we have proven that schools can operate effectively on less tax money.

With our financial problems fixed, we have now shifted our local priorities from financial matters to actually improving education. We want to be conference champs in all academic areas. Throughout all of our discussions as a Board, we always have to remember this phrase “What is best for the education of our children?” I even made a sign to place in front of me during Board meetings.

Pouring more money into education doesn’t automatically help the education of our children. For example, doubling the wages and benefits of our existing teachers doesn’t help the education of our children. They still have the same teachers teaching the same curriculum. In order to make strides in education, we have to make changes in the philosophy of our school. Just this last month our Board approved a new policy which contains an element of accountability for teachers in certain advanced courses. Under the No Child Left Behind act, school districts will have to be accountable to students and their parents. When we passed our new policy with teacher accountability, I soon found out that teacher unions do not like their members to be even partially evaluated based on the results of their teaching ability. Incorporating accountability into teaching is as big a change today as the revenue cap was in 1993. In my opinion, the main reason why teacher unions do not want standardized testing at every grade level is because it makes it easier to implement teacher accountability criteria.

While our Board has made many changes in the district to improve the education of our children, some of the changes we discussed are not possible under current state and national laws. Our Board will continue to educate our children with however much money we are allocated, but we need some additional tools to help us.

Here are some suggestions for improving schools that should be mandated by state government. These suggestions do not cost taxpayers extra money:
1. Teacher Pay Scales. Replace the seniority based pay scales with performance based pay.

2. State Statutes. Change the state statutes that prevent outcome-based compensation strategies. For example, Wis. Stat. 118.30 says: Results under the state-mandated student knowledge and concepts tests may not be used to evaluate the performance of, discipline, or non-renew any teacher. This is exactly the opposite of what should be the law if we remember “What is best for the education of our children?”

3. School Choice. Make all schools truly compete with each other. Allow vouchers for all students statewide. Competition will force public schools to get better. Shut down the schools and fire the administrators that cannot do their job. Require all students, whether in public schools, parochial schools, home schools, or Internet schools to pass tests demonstrating their mastery of standardized curriculum before advancing to the next grade level.

4. QEO. The Qualified Economic Offer is the main tool available to school boards to control employee costs which are the largest slice of the expense pie. I have been deeply involved with the ramifications of the QEO and have actually lost sleep over the issue because in order to get a concession in our out-of-control post retirement costs we had to threaten implementation of a QEO which would have caused teachers to pay money back to our district. The QEO benefits many school districts, but because teachers have been singled out, I have stated publicly that I oppose the QEO. However, eliminating the QEO should only be considered if the government also eliminates binding arbitration. Binding arbitration is broke and needs to be fixed. A Board cannot propose significant changes to union contracts because arbitrators look only at other school districts within the same conference for comparables. This makes it too difficult to make necessary changes. Try changing health insurance carriers if every comparable school district uses the WEA Trust. If other school districts in your athletic conference have not been responsible with taxpayer’s money, your school district will have no chance of winning an arbitration hearing by being responsible. Do not eliminate the QEO tool unless school districts and teacher unions are given the old tools of strikes and lockouts.

5. QEO and Revenue Cap. The QEO is 3.8 percent and the average increase in revenue cap for our school district is about 2.7 percent. The QEO should be tied to the annual increase in revenue cap. If you put 2.7 percent more money in your billfold each year and take out 3.8 percent more money each year, how long before your billfold is empty?

6. Health Insurance. Wisconsin is the only state in which the primary health insurance company for teachers is owned by the teachers’ union and most union contracts have language that hard wires the WEA Trust as the mandatory insurance carrier. The state needs to allow all schools to unilaterally change to the state Uniform Benefits insurance program. Or at least allow the district to base its contribution towards insurance premiums on the state plan with the insured group paying any difference if they select a more expensive carrier.

7. Teacher Discipline. It is too difficult to non-renew ineffective teachers. We have waited more than two years for an answer from DPI on a specific licensure matter. Did you ever try to non-renew a nice, but ineffective, teacher?

8. Centralize Jobs. Each of the 426 school districts must have their own Curriculum Coordinator plus each one has to pay teachers and staff to help develop curriculum. Why? Using Open Records Laws, why can’t we just copy the curriculum and purchase the same textbooks as the number one performing school district in the state? Why must we reinvent the wheel? The government has standardized tests. Where is the standardized curriculum to match? Why can’t every parent be assured that when their child advances from grade 4 math to grade 5 math their child will have at least the same basic knowledge of fractions and decimals as a student in another school?

9. District Administrator. Change DPI rules to allow a school district to be run by a Business Manager. Do not require experience as a teacher. This causes inbreeding. Other businesses don’t do this. For example: Kraft Foods, which owns a number of cheese factories in Wisconsin and a plant in Weyauwega, does not require their CEO to have been a cheesemaker. Our previous District Administrator, with a doctorate degree in education, was inexperienced in the financial aspects of running a school district so our district had a Business Manager. When the District Administrator resigned to take a job at CESA in Green Bay, our district wanted to promote our state licensed school Business Manager to a full-time District Administrator with special assistance from two of our Principals. However, DPI requires that a District Administrator have previous teaching experience to get a license. Our Business Manager had a Master’s Degree and many years of actual school business management experience and was going to retire in a couple years. We requested a waiver from DPI so our Business Manager could act as an official District Administrator. DPI wrote back and said no. However, DPI said that having an official District Administrator is not a DPI requirement, so we could legally operate without a District Administrator if the Board would select someone to sign official school reports to DPI. So how is it better to have no District Administrator than to have a District Administrator with school business management background?

These are only some of my thoughts for changes the state could make that would save taxpayers’ money while simultaneously improving the education of our children. My main point is that throwing more money at schools is not the answer. Maybe having less money would force school districts to make the hard choices. In my opinion, school districts must remember that we are in the education business, not the guaranteed employment business. What is best for the education of our children?
Some Things We Did to Balance Our Budget:
• Identified and removed “slush” items from the budget.
• Replaced the District Administrator with a Business Manager.
• Prepaid most school construction loans. Refinanced final remaining loan at under 2%. Eliminated short term borrowing.
• Prepaid WRS “prior service” loan which had 8% interest rate.
• Reduced administrative overhead. Reduced some staff.
• Negotiated new union contracts.
• Reviewed expense accounts. Combined jobs.
• Sought volunteers for non-instructional work that formerly required paid employees.
• Created an insurance committee.
• Stopped paying for snow days for some employees.
• Paid for professional development of some key employees.
• Job sharing with adjacent school districts — school nurse.
• Eliminate unfunded police liaison officer.
• Reduced number of school busses.
• Computerized the school lunch program.
• Co-sponsored some projects with the Booster Club.
• Reviewed and updated all school policies.