WATERFORD, Mich. (WXYZ) - At its regular meeting Monday night, the Oakland Schools Board of Education approved the elimination of 36 positions (35 full-time equivalents or FTE) and accepted the retirements/resignations of 28 employees who took advantage of the Voluntary Employee Sick Leave Payout Program (VESLPP). A second workforce reduction, expected to affect approximately 26 employees at the four Oakland Schools Technical Campuses, is anticipated for February 2010 and a third, likely to impact another 10 positions across the organization, is planned for 2010/11.
The elimination of positions through attrition, current and planned workforce reductions and VESLPP equates to 115.1 employees or a 22% reduction of employees during the two-year period from 2009-11. The 83.1 positions eliminated by attrition, transfers, the workforce reduction, and VESLPP are expected to save the ISD at least $7.8M per year. Oakland Schools has already instituted five unpaid furlough days for the next five years for full-time employees (three for part-time) and a wage freeze through 2011 followed by a three-year 3% wage reduction starting in 2012.
“This was an extremely difficult decision,” noted Board President Ron Storing. “However, despite our most prudent efforts, we found it necessary to be proactive and eliminate positions now as part of Oakland Schools’ long-term survival plan.” The intermediate school district is primarily funded by countywide millages that rely on revenue based on property values. Oakland County’s property values are projected to continue to fall by 27% over the next three years and are not anticipated to regain 2006 levels until around 2020-2025, according to Oakland County Deputy Executive Robert Daddow. Daddow also cautioned that, while revenues from property taxes may be capped, ISD expenditures are not, underscoring the importance of the board’s actions to make cuts now, rather than later.
“We work closely with the Oakland County Government to monitor and adjust our five-year financial forecast,” said Dr. Vickie L. Markavitch, Superintendent. “Unfortunately, the news continues to be grim and we have suffered additional setbacks with the state’s current 25.8% cut to Section 81 (approximately $1.2M/year) as well as additional cuts totaling $631,000.”
The Board noted that the decision to permanently eliminate positions was approached thoughtfully, using district usage trend data, rating data from Oakland County districts, as well as data from a variety of other sources. “We have to position ourselves to weather this storm so that we can continue to provide needed core services when districts need them most,” said Markavitch. Dr. Victor Mayo, Superintendent of Hazel Park Schools and President of the Oakland County Superintendents Association, agrees. “This funding crisis, exacerbated by mid-year cuts and prorations, means that Oakland County school districts need the ISD to provide services we can no longer afford, from the programs at the four technical campuses to instructional and business office support.”
Oakland Schools is taking a unique approach to the workforce reduction. Employees were notified on November 11 and may retain their jobs until June 30, 2010. During the interim period, they are expected to continue to be contributing members of the organization and are being given five career transition days for job interviews as well as job outplacement support. “Since 2003 we will have downsized over 30% of our staffing – 20% with the actions we are taking now”, said Markavitch. “Our primary goal is to retain core services to our local school districts. To do that, we need our employees to partner with us as we transition to a smaller organization. We also want to provide employees who are impacted by this reduction every opportunity possible to connect to a job where their many talents and experience can be put to good use.”
The VESLPP program and workforce reductions are part of Oakland Schools’ strategic approach to cut costs and conserve resources to address the dramatically diminishing revenue from the ISD’s primary funding sources. Besides the two-year wage freeze, continued insurance cost-sharing, unpaid furlough days, and three-year 3% wage reduction starting in 2012, Oakland Schools has also reduced travel and other purchased services, slowed down equipment replacement, cut supply budgets, and reduced contractors’ pay rates.
