News Story

'Budget Cut' Doesn't Mean the Same Thing to Public and Private Sectors

Leon Drolet says there is a communication gap between the private and public sectors when it comes to the definition of “cutting a budget.”

“Government employees have a very different definition,” the president of the Michigan Taxpayers Alliance said. “Government claims to cut its budget every year, but spending never goes down. Citizens spend less when they cut their own budgets. This is part of a language gap that exists between government workers and citizens.”

A recent example is Warren Fitzgerald Public Schools Superintendent Barbara Van Sweden, who told the Macomb Daily that school districts have resorted to “disguising” the impact of annual budget cuts so that more students don’t flee to a different district. Yet, Van Sweden’s district general fund expenditures increased every year from 2005 through 2010. In fact, according to the financial audit on the school’s own website, general fund expenditures climbed from $27.01 million in 2005 to $33.82 million in 2010.

Van Sweden didn’t respond to an email or phone message left at her office.

A Warren Fitzgerald teacher who had six years of experience with a bachelor’s degree would have earned $53,672 in 2005-06, according to the union contract. That teacher would have had a 7.4 percent raise for 2006-07, a 7.3 percent raise for 2007-08, and a 6.5 percent raise for 2008-09, leading to a base salary of $66,048.

That district would have paid 100 percent of the premium for health care insurance for that teacher. According to a Kaiser Foundation survey of employers in Michigan, the average employer pays only 80 percent of the cost when they offer health insurance to employees, with the employee expected to pay the remaining 20 percent.

In the Macomb Daily, Van Sweden suggested that school officials should take a stand against the new governor’s plan to cut funding by $300 per pupil.

“There comes a time when you have to say, ‘This is it.’ And we’ve reached that point,” Van Sweden said in the article. “Because we’re the ones who face the kids every single day.”

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

West Michigan School Super Claims Budget Cuts — But Do the Numbers Add Up?

The superintendent of a Grand Rapids-area school district recently claimed that Gov. Rick Snyder’s proposed cuts to schools were about union busting and said that his district cut $1.4 million from the budget this year. This appears to conflict with his own school’s audits.

Godfrey-Lee Superintendent Dave Britten told The Grand Rapids Press that his school cut $1.4 million from the budget in 2010-11. However, the school’s audit report on its website shows the school had $16.4 million in general fund revenues for 2009-10 and that this increased to $18.7 million in 2010-11. This is according to the district’s amended budget.

“How does that math work?” asks Michael Van Beek, the education policy director at the Mackinac Center for Public Policy, who fact-checked Britten’s claims.

Britten didn’t respond to an e-mail or phone message left at his office. The district said he was out of the office preparing for a community forum on budget cuts scheduled for Thursday night. A form letter that was prepared by the district to send to legislators claims that state revenues have been reduced since 2002.

Britten isn’t the only superintendent to claim that a school district’s budget was “cut” while it actually increased.

Walled Lake Superintendent Kenneth Gutman claimed that his district had cut $31 million from its budget over the past 10 years. But Van Beek found that the district’s budget increased from $119 million in 2000 to $159 million in 2011.

A Godfrey-Lee teacher with a bachelor’s degree and seven years of experience would have a $47,855 salary in 2008-09. That would rise to $51,255 in 2009-10, an increase of 7.1 percent for one year. That teacher would get another 5.7 percent raise in 2010-11, to $54,184, according to the district’s teacher union contract.

The current contract doesn’t call for any teacher contribution to health care premiums. But Van Beek said the 2009-2010 audit report available on the district's Web site states teachers will contribute toward their health care premiums for the first time in 2010-11.

The report does not identify how much they will contribute. The Kaiser Foundation has reported that private-sector employees contribute an average of 20 percent toward their health care coverage when they work for Michigan employers who offer a health care plan.

Britten was featured recently in a Grand Rapids Press article about Snyder’s budget cuts. He told the newspaper: “What they want is to break the union. I’ll point out the elephant in the room. That’s exactly what’s going on, and the general public doesn’t know it.”

“The general public honestly thinks that what’s going on in Lansing right now is to make schools better and to solve the state’s fiscal problems,” Britten said. “That’s not it.”

Britten told the Grand Rapids Press that the school cut $1.4 million from the budget in 2010-11 and $750,000 in 2009-10.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.