information for the community

North East ISD declares financial emergency

Forty-two million dollars to be reduced over next three years

On Monday, October 19, the North East Board of Trustees approved a resolution to declare a financial exigency and a need for program changes. This move authorizes district staff to implement budget cuts starting in 2010-2011. (To see a copy of the presentation about the district's need for financial exigency, click here.)

The Board's action acknowledges the district's financial need in coming years. With the economic uncertainty of the state school finance system and the inability to significantly increase revenue, North East ISD is implementing a three-year spending reduction plan to ensure financial stability and stewardship of public funds. This would apply to the 2010-2011, 2011-2012 and 2012-2013 school years. Across these three years, the district plans to reduce approximately $42 million. The cumulative savings would add up to $63 million.

"If we continue business as usual, the district would head toward a financial crisis in 2011-2012," said Superintendent of Schools Richard A. Middleton. "That is why we are taking steps now to protect our financial viability in the future."

The district is looking at options such as freezing salaries, replacing the high school A/B block schedule with a seven-period day, eliminating teaming at the eighth grade, reducing staff at campuses and central office, and cutting the number of work schedule days for magnet program teachers. As an example, replacing the A/B schedule with a seven-period day would reduce the number of teachers needed to staff each high school, saving about $6.5 million. Freezing salaries next year also adds a $15 million savings.

NEISD will reduce the number of positions across the district in 2010-2011. Retirements and resignations may create vacant positions, thus reducing the number of reductions needed, but it is likely that the district will be forced to carry out a Reduction In Force (RIF). The district’s Human Resources department will develop a potential RIF employee listing in March followed by board approval of a finalized RIF employee listing in April. The RIF will only be implemented when there are more displaced employees than vacant positions or if the displaced employees do not meet the necessary certifications of the open positions.

The district will spend the rest of this year preparing for the budget cuts. NEISD is expected to hold budget study sessions in May followed by the 2010-2011 budget adoption in June.

Posted on October 20, 2009