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Could Racine Unified Use Its $10 Million Healthcare Savings to Buy Another Year?

Dave Hazen, CFO of the Racine Unified School District, proposed putting a projected $10 million healthcare savings into a fund and using it in combination with redistricting to plug a $6.5 million hole in the 2012-2013 budget.

The Racine Unified School District saved over $10 million this year by overestimating its healthcare spending. Whether or not a redistricting plan goes into effect next year could hinge on how that money is used.

Dave Hazen, chief financial officer for Unified, told board members and an audience of about 100 residents at the Board of Education meeting on Thursday that the savings could be higher, but he’s being conservative. He proposes putting that money into a healthcare stabilization fund administered by the Board of Adjustment committee that can be used to stabilize future budgets when and/or if needed.

The Board of Adjustment includes members from the district and the Racine Educators Association. The group is addressing issues related to health and dental benefits.

“If we maintain our spend, but put the money we’re saving now into this special fund, it will help solve our budget problems,” he said.

Hazen said the district budgeted for $42 million in healthcare spending, but the numbers he's seeing are actually much lower.

Then the Board of Adjustment could work on wellness and long-term health strategies to reduce the overall need, Hazen said.

In short, Hazen thinks that by combining the redistricting plan with the healthcare stabilization fund, the district will bridge a projected $6.5 million budget gap for the 2012-2013 school year.

The redistricting plan - which is vehemently opposed by the families, faculty and staff at both and schools - targets those buildings for closing. Most students would move to neighborhood schools if the Board votes Monday to approve the plan.

Dennis Wiser thinks the healthcare stabilization fund should be used to fully bridge the budget gap for next year so board members can have more time to make sure what they do is right.

“The timeline is terribly fast,” he said after the meeting was over. “We don’t have the best track record for long-range planning so I’m concerned. When I think about moving kids, parents changing their lives, reducing staff, I want to do it right. I’d rather take a year to think about it so a year from now we aren’t going through this again.”

Pastor Melvin Hargrove, also a board member, said he thinks it’s prudent for the board to vote on Monday.

“Dave (Hazen), Pat (Duff), and Dr. Laing have done due diligence and we’ve gotten a lot of information over the last couple of months, so I do think we should vote on Monday,” he said. “Unfortunately, anything we do will disrupt lives, and I pray we can move things forward.”

But Julie McKenna, even as she agreed more with Wiser, seemed to side with Hargrove based on her experience with redistricting plans in the past.

“We do need more time to reflect because while we have one piece in place, we need all the pieces,” she said. “But I’m afraid if we wait any longer, we’ll just keep pushing decisions further down the road.”

Still, she said she voted against school closings before and said the projected savings may not measure up, which has also been part of her past experience on the board.

Brian Dey March 16, 2012 at 11:42 AM
The picture above is so appropriate. The raising of the deductible means less usage. That is why it has been done in the private sector for years, to eliminate abuse of health insurance so that employees would no longer take themselves and their families in for every little sniffle. The flaws of this redistricting plan, and really, this is not redistricting, is flawed in its financial savings as it does nothing to project how many children will leave the district because of these moves. As I told the board last night, I would recommend working towards a districtwide plan taken from the many plans presented by the community, including my plan, and form a community panel to enhance revenue by keeping more kids in the district, and take the savings from this year to offset the budget shortfall entirely.
Justin Klis March 16, 2012 at 12:28 PM
Agreed with Brian. We will be one of the families looking to leave the district if this goes through. We are very happy with our neighborhood school, the other families and the teachers.. Keep Goodland and Wind Point Elementary open and don't jump to quick decisions, there are other plans out there that make sense... It's also a dumb idea to bus 4k halfway across the city. I've been fed up with the school board for many years, but liked our neighborhood school, close it and we won't have many reasons to stay.
Heather Asiyanbi (Editor) March 16, 2012 at 01:28 PM
@Tim - do not ever post that photo of Dave Hazen again. I will not tolerate it. If you feel the need to post that kind of image, do it on your own website. This is a news website, not a blog.
GearHead March 16, 2012 at 01:38 PM
So we are saving 10 MILLION thanks to the tools Act 10 gave the district. One thinks the Governor and local Republican leadership are due at least a little grudging respect for making this so. It certainly wouldn't have happened without it. But I won't hold my breath, being six of the nine members signed recall pettitions against Walker and/or Wanggaard. Yes, some of them are up for re-election. Success sucks when you are on the wrong (losing) team.
Tim Scott March 16, 2012 at 02:01 PM
OK.
Tim Scott March 16, 2012 at 02:10 PM
Considering what the anti-Walker protestors have been using in their demonstrations - mine was very mild - and relevant - by comparison. I will respect your wishes - but I will also check to make sure that bias isn't applied the other way. TELL ME HEATHER - Will you censor the pictures and signs of the Left, and the Anti-Walker people? Make sure your standards are applied evenly - is all I ask. I will WATCH.
Heather Asiyanbi (Editor) March 16, 2012 at 02:19 PM
@Tim - I'm pretty sure that our readers will back me up when I say every photo for every story that I write on Patch is an appropriate illustration for the story. There is no bias either way. I do pay attention when readers post photos and I will take down anything that doesn't meet our Terms of Service.
Chris Larsen March 16, 2012 at 02:20 PM
There are two issues here, as I have posted in the past when this has come up. First off if money spend on a place for the administration to park their backsides for 10 million, plus the shady back loan for the undervalued land swap/purchase of the old site would have been saved, there would have been no deficit, plus extra cash to spend in the schools! Also, Hazen is king at coming up with "savings" that just materialize, or have a 20 year turnaround. I also question why this board feels the need to slam this through before the election. The board of adjustment has no direct accountability to the taxpayers, and I have an issue in turning over 10 million to a group made up of hand picked district insiders and the teachers union.
Midwest George March 16, 2012 at 02:35 PM
Gearhead- are you saying Walker's tools helped RUSD over estimate? Doesn't sound like good acounting practices to me. What if their estimation was more accurate? They'd still have a hole in the budget to fill. And now what? Close schools? Yeah, that's good for the community. I would hardly call this a Walker success.
Brian Dey March 16, 2012 at 03:03 PM
Midwest George- Without Act 10, there would have been no give backs. The union knew it would be political suicide if they did not agree to the cuts enacted in Act 10, and most teachers were agreeable to the provisions of cuts in health care and savings. It is precisely the "tools" that the Milwaukee Teachers Education Association asked Walker if they could use, even though they rushed through a contract. I will give "kudos" to both Walker's Act 10, and the cuts the RUSD unions took to match it. Both helped the district save $29 million. As far as David Hazen is concerned, it appears that with most financial decisions, he is out of his league as CFO. Thankfully, his error went in our favor, and we no longer need to rush through school closings and can take the time to do it right.
Tim Scott March 16, 2012 at 04:55 PM
I'm OK with that answer. I can follow rules. However, I will test every boundary. Thank you Heather.
Tim Scott March 17, 2012 at 01:22 AM
Racine Wolf Man Pickets RUSD To Be Responsible! http://racineuncovered.org/2012/03/racine-wolf-man-pickets-rusd-to-be-responsible/ (you should see the other side of that sign!) LOL.
mau March 17, 2012 at 01:59 AM
@Tim, gotta love it. A pack of one.
Tim Scott March 18, 2012 at 01:10 AM
The Racine Wolfman also made news over at JT Irregulars! http://www.jtirregulars.com/2012/03/racine-wolf-man-pickets-rusd-to-be.html He may also appear, as he has previously, at the intersection of Hwy 31 and 20 again. Keep your eyes open! You never know where he is going to strike. A fly on the wall told me that the Wolf Man will appear in Kenosha, at the Courthhouse on March 21st - around noon. He is suppoused to be accompanied by a very special guest and a good time should be had by all! Press-Release Soon!

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