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School district getting taste of steel and auto experience

The Butler School Board is right to explore possible school closings in confronting its estimated $6.5 million 2012-13 budget deficit and possible deficits going forward. Every part of the district's operation should be examined for cost-savings opportunities.

However, as part of that study, the district should look closely at what brought about its financial predicament, acknowledge the mistakes, and pledge not to repeat them.

That deficit number could be substantially less if past boards had been more committed to controlling costs, particularly salaries. Instead of approving early-bird sweetheart contracts with the Butler Education Association that, cumulatively, have exacted a heavy toll on the district's budgets, past school boards should have stood firm against raises substantially beyond the inflation rate, regardless of what was happening in nearby school districts.

For years, there were indications of tougher school budget times ahead, because of what was happening in Harrisburg. Even if there hadn't been, Butler school directors should have erred on the side of austerity.

As it now stands, the district pays about $66 million annually for salaries and benefits; it's 2012-13 budget is expected to be about $93.8 million.

That salary figure encompasses all employees, not only teachers, but teachers receive the bulk of that money.

Meanwhile, the new school board, which includes five new members, also must deal with the devastating effects of the state Legislature's 2001 pension grab, which increased teacher pensions by 25 percent.

The school board can't undo that pension action. However, district negotiators, in the aftermath of the Legislature's costly action, could have stood firmly to control the size of pay raises, factoring in the district's increased pension-funding obligations.

Unfortunately, past boards did not take that stance.

Lawmakers were shortsighted in increasing pensions, not only theirs and teachers, but many other state workers'. Butler's school boards were equally shortsighted in not reacting correctly to the Legislature's unconscionable action.

What's happening now in public education is reminiscent of what happened in the steel and auto industries.

In the steel industry, companies negotiated worker contracts with excessive raises and inflated benefits that were impossible to sustain over the long run. They also kept outdated work rules that prevented efficient, less-costly production.

Similar sweetheart contracts with big pay raises and overly generous benefits devastated U.S. carmakers' viability, which, like in the steel industry, were the seeds for eventual concessions, layoffs and plant closings.

The financial realities that hit the steel and auto industries now face public education. Money isn't unlimited, and everyone might have to expect less in the future if job security is a priority.

The day might be coming when teachers unions feel lucky getting modest raises during only some years of a multiyear contract — or face job losses.

The study of possible consolidation of Butler's school system operations could be the beginning of that time, if school directors conclude that the district's financial situation is dire. Indeed, the state should revisit consolidation of school districts to determine what efficiencies might be achieved without harming the learning process.

However, closing a school would not necessarily be a panacea, since busing and other costs might rise.

“We've cut all the fat; we're down to the bone this year,” said Jim Keffalas, one of the five new board members and the head of the finance committee.

For 2012-13, the board might be forced to whittle the bone to balance the budget. The cuts that were made to balance the current budget were unheard of prior to Gov. Tom Corbett's school subsidies stance.

In large part, the Butler district's past decision makers planted the seeds for what it now faces. It's on the shoulders of the current board to make the tough choices to resolve what is a financial crisis.

The board will — and, by state law, must — resolve it, with or without school closings.

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