May 10, 2007 at 1:42 am

Lakeview district can't tighten belt anymore

ST. CLAIR SHORES -- Sandra Feeley Myrand doesn't know what to cut next. Over the past few years, the superintendent of Lakeview Public Schools in St. Clair Shores has dropped bus service. She's privatized the janitors. She's slashed the administration staff.

Now, she and school board members, who have already faced one recall vote because of budget-cutting measures, are searching for more cuts for next year, partly because of rising retirement costs.

Michigan is the only state where school districts shoulder the total cost of retiree pensions and health care. Because of this, school districts like Lakeview are hurt more by retirement costs than districts in other states.

Feeley Myrand doesn't begrudge retirees their pensions and health care. But as she helps prepare the district's 2007-08 budget, she knows that every dollar spent on retirement is a dollar that can't be used in the classroom.

"It's going to become a larger and larger issue," said Feeley Myrand. "But little ol' Lakeview can't solve it."

Michigan's 553 school districts pay the bills for the state's school retirement system, but have no control over the loophole-ridden policies that are increasing those costs rapidly. The Michigan Legislature sets the policies and the state Office of Retirement Services sets the rates schools pay to cover retiree pensions and health care.

Lakeview's painful belt-tightening illustrates how skyrocketing retirement costs are chipping away at Michigan's public education system, and highlights the growing tension between frustrated school administrators and the politicians they view as too beholden to school employee unions.

Lakeview is a small district in Macomb County, pulling its 3,000 students from a bedroom community dotted with 1950s ranch-style homes. It's a proud community that doesn't take kindly to change, especially the type of changes forced on the school district in recent years.

The rate the district pays to the Michigan Public School Employees Retirement System jumped from 12.17 percent in 2001-02 to 17.74 percent this year. For Lakeview, that meant cutting $800,000 from its budget in five years.

"That's less money we can spend on books, on classroom supplies," said Feeley Myrand.

"Our premise has been to reduce (the budget) as far away from the classroom as possible," she said. "We have small class sizes, 20 or under for kindergarten through second grade, 25 or under for third through fifth. We use class size to sell our district."

But with the retirement assessment projected to jump to 30 percent of payroll by 2020, the district will quickly run out of places to cut.

"I'm sitting here with buildings that are 50 years old," she said. "My business manager is also operations director; I am superintendent and human resources; the curriculum director is also the technology director. We're all doing double and triple work.

"What's next? One principal for two schools? Elimination of orchestra and band? Pay-to-play for sports and clubs? Thirty (students) in a classroom? Thirty-five? We have no place left to go."

Feeley Myrand worries about how much worse the financial crisis will become before action is taken.

"Some of my colleagues believe that there will soon be another Kalkaska (where schools closed two months early in 1993 because of a budget crisis). Maybe that's what it would take to get Lansing's attention," Feeley Myrand said. "I don't know how you recover from something like that."

Jefferson Middle School students walk home as buses from other school ... (Brandy Baker / The Detroit News)
“My business manager is also operations director; I am superintendent and ...