Contract talks between the Franklin County school district and its employees went to impasse last week, but both sides are continuing to talk as time ebbs away to reach a deal to shore up the district’s shaky finances.
The school board’s chief negotiator, Tallahassee attorney Leonard Dietzen, served notice Feb. 1 to the state’s Public Employees Relations Commission the district had declared an impasse in the talks.
This was due to the inability of both sides to make progress within a 14-day window created when the district first notified the Florida Department of Education that it faced “financial urgency” due to a more than half-million shortfall in revenue to meet its obligations.
“Both sides could not reach a mutual conclusion, and we had extended beyond the 14-day requirement to do a speed-up negotiation process because the district declared a financial urgency,” said Rik McNeill, executive director of the Florida Education Association’s Central Panhandle Service unit, who is a key negotiator on behalf of the county teachers and education support personnel. “When we got together and we could not agree on everything, the district declared impasse.”
While an impasse could lead to the appointment of a special magistrate to intervene in the talks, that does not appear to be a priority for either side.
“We are still working on a variety of solutions to the impasse, rather than going through a costly administrative law judge, a special magistrate, to make a determination,” said McNeill. “Both sides are talking; it’s not like we’re in an absolute stalemate where it really requires a third party to come in and try to mediate some other kind of settlement.
“Both sides have worked extensively outside of the box, dealing with a multitude of things that caused the final situation,” he said. “I don’t know that a mediator would come up with anything more novel than either side has come up with.
“It seems foolhardy to go that course,” McNeill said, noting that the cost could be several thousand dollars. “It costs us more money and delays the time to recoup any sort of savings. We’re trying to do that in as expeditious manner as we can.”
Based on discussion with administrators, and from material disseminated by the union, both sides are working on ways to prevent or minimize job losses, perhaps by shifting benefit costs to employees or be implementing a tiered-system of salary reductions.
Superintendent Nina Marks’ recent proposal, an across-the-board pay cut for all employees of 19.5 percent - from February to June 30, 2013, the end of the fiscal year - remains on the table. This would have an estimated revenue benefit of $512,000, roughly what is needed to close what Finance Director Shannon Venable has estimated is about a half-million dollar shortfall.
The school board members and the district’s key administrators each took a 5 percent pay cut beginning in July, so each now would have to absorb a 14.5 percent pay cut for the remainder of the fiscal year.
Marks said that in October 2012 the union was notified of budget deficits and offered a similar administrative recommendation of a 5 percent across the board salary reduction for all district employees, retroactive to July 1, 2012.
“The union did not act upon this recommendation but board members and administrators did,” she said. “An additional proposal of 19.5 percent for all other staff, not just teachers, was proposed as one single item to balance the budget by the end of the fiscal year June 30, 2013.  As expected this single proposal exposed the seriousness of what the district was experiencing.”
Venable said further slimmed-down proposals, such as a 15 percent cut for all employees, would save $390,000, while a 10 percent cut would recoup about $255,000. A furlough of up to seven days also has been talked about, with each day saving the district about $28,000.
The union has countered with a sliding scale reduction of 1, 2 or 3 percent, depending on salary level, but the administration has said it would not save nearly enough money.
“We have gone back a few times on reduction in salaries,” said Venable. “We’re so late in the year, it has to be something high.”
McNeill defended the union’s stance that everything must be done to prevent cuts that would both harm individual employees as well as the overall economy
“All of the recommendations that came down dealt with hurting employees , either by taking back salaries or cutting benefits,” he said. “The employees really live paycheck to paycheck like most citizens in Franklin County. We’re trying to come through with solutions, without it devastating the employees.
“Any cut like that will impact the economy of Franklin County,” said McNeill. “With citizens not being able to make their bills, it will have a terrific domino effect on what is already a fragile economy.”
An elimination of the district’s Health Reimbursement Account (HRA) card, which can cover the annual cost of a recently implemented higher deductible, would save about $44,000, but the union has said this would be unfair since some employees wait until the end of the year to take advantage of the benefit.
Also on the table is a plan to ask employees to pay $44 a month towards their health insurance premium, a move that would save $34,000. Currently, the district covers the entire cost of insurance premiums for individual coverage.
Another suggestion has been to eliminate board-paid life insurance for employees and retirees, and to stop supplementing retiree health insurance, which would save $21,000. “Anything to do with insurance is still in negotiations,” said Venable.
One suggestion that has been explored extensively in the talks and in scrutiny by the state, has been to defer two summer 2013 checks to next 2013-14 fiscal year, when the district will be able to recoup about $400,000 in lost property tax revenue during the current year.
Venable said that this “prior period millage adjustment” enables a district to assess additional millage the following year if there are changes between July and October of the fiscal year. “We’re going to see that on our tax revenues that come in next year,” she said.
In the union’s original counterproposal to the district, the teachers led by Cathy Wood and the support staff, led by Tammy Sasnett, offered several other suggestions, including a reduction in the days of the year, expenses and vendor accounts such as lawn, cell phones, etc. and even a short-term bank loan.
“We’ve done everything we can do,” said Venable, noting that 90 percent of cell phone costs are reimbursable through a federal technology assistance program.
As it stands now, if no agreement is reached, it will be up to Florida Commissioner of Education Tony Bennett to help by bringing to bear state expertise, and up to the school board to make the final decisions on what to do.
“The school board ultimately makes the final decision, they can say this is the way it’s going to be and there is no court of appeal to that,” said McNeill. “They have to make that decision and they have to make the best decision for the whole community.”
McNeill said all sides have appealed to the DOE and to Governor Scott for help.
“The DOE and the governor are very concerned about Franklin County,” said McNeill. “They all will offer advice and expertise but none of that is hard, cold cash.”
The union rep sounded a trustful note in sizing up the state of affairs between the employees and the district.
“Nobody’s hiding any money or squirreling or it away or being deceitful,” he said. “There’s not a quick fix for this.”
Marks said that for the first time since the 2006-7 school year, Franklin County has experienced declining enrollment in its student population, contributing to the revenue decline. “Various reasons have contributed to this decline but economic opportunities may be the primary motivation for leaving the area; fewer students signify a need for fewer instructional/non-instructional staff,” she said.
“The district leadership’s primary objective is to safeguard and promote the educational prosperity for all the children of Franklin County and sometimes in doing so leadership has to make the very difficult choices,” Marks said. “I do not want to see anyone lose jobs or benefits and would have preferred that all staff share equally in the reduction process; yet here we are.
“The two sides must come to an understanding for the benefit of the children.   As educators it is our job to help all students succeed at learning,” she said.