School District of

Fort Atkinson

A Look At The Future

The Board of Education is looking at three

major challenges facing our school system.

1) NEEDED BUILDING UPGRADES – To the heating, ventilating and air-conditioning (HVAC) systems at Barrie, Rockwell, Purdy and the Middle School.

2) A STRUCTURAL FINANCIAL DEFICIT – There is an annual revenue shortfall for day-to-day operations.

3) TECHNOLOGY NEEDS – The State TEACH Grant used for technology ended in 2003.

CHALLENGE #1

Needed Building Upgrades

(HVAC Systems)

School District of Fort Atkinson

Because our buildings have been well cared for, we believe that with some updating Barrie, Rockwell, Purdy, and the Middle School can continue to serve us well into the future.

History of Barrie School

1939 Original Building has steam heat which originally used coal for fuel. The mechanical systems are 65 years old and are obsolete.

1976 Addition has hot water heat. All mechanical systems are 29 years old in this addition.

1997 Remodeling included classroom upgrades, and technology improvements, but no mechanical upgrades.

History of Purdy School

1956 Original Building has steam heat. The mechanical systems are 49 years old and are obsolete.

1976 Addition has hot water heat. All mechanical systems are 29 years old in this addition.

1997 Remodeling included classroom upgrades, and technology improvements, but no mechanical upgrades.

History of Rockwell School

1956 Original Building has steam heat. The mechanical systems are 49 years old and are now obsolete.

1959 Addition is heated by steam from the 49-year-old original building. All mechanical systems are 46 years old in this addition.

1976 Addition has hot water heat. All mechanical systems are 29 years old in this addition.

1997 Remodeling included classroom upgrades, and technology improvements, but no mechanical upgrades.

History of the Middle School

Original 1911 building has been replaced except for the steam boilers which originally used coal for fuel. These boilers were produced in 1929. They are 76 years old and are obsolete.

Additions and mechanical systems’ age: 1953 (52 years old); 1960 (45 years old), and 1965 (40 years old).

1983 Remodeling which replaced the 1911 section, added a gymnasium, and air conditioned the offices, music rooms and the library. Other mechanical upgrades were minimal.

1998 Remodeling from a high school to a middle school, with technology improvements and minimal mechanical systems upgrades.

Why We Need to Upgrade

In addition to being 49 to 76 years old, and obsolete, the steam boilers and heating systems in these four buildings are very energy inefficient, expensive to operate and maintain, and cause large temperature swings in classrooms, especially in Spring and Fall.

Fort Atkinson High School & Luther School

Both the High School (1998) and Luther Elementary with the Administration wing (1966, 1967, 1997, 2001) are air-conditioned and have efficient hot water heat.

These buildings are not recommended for renovation or upgrades at this time.

Keeping our “house” up-to-date

is something we just need to do!

We may not look forward to updating our “house” we know it’s something we must do to protect our investment!

CHALLENGE #2

TechnologyNeeds

Technology Needs

Reduced revenue• The State TEACH block grant, which

provided about $90,000/year for technology purchases, ended in 2003.

• A 7% reduction in the non-employee portion of school building budgets, beginning in 2003-2004, impacted technology spending.

Maintaining technology• Replace computers on a 5 year cycle.• Maintain the district’s network

Infrastructure

Total additional needed per year to maintain current technology services = $179,000

CHALLENGE #3

A StructuralFinancial Deficit

What is the Structural Financial Deficit?

The Revenue Cap – State Law limits the growth of schools’ revenues to about 3% annually.

The QEO (Qualified Economic Offer) – State Law requires schools to offer a wage and fringe benefit increase of 3.8% annually to avoid arbitration.

Inflation on utilities, equipment, supplies, etc.

The Structural Financial Deficit = Approximately 1% of the total budget each year.

All things being equal, the district must cut about $230,000 each year to balance the operating budget.

Reality of Recurring Structural Deficit

To meet the annual structural deficit, our District would need to reduce operational costs by $230,000 every year

There is NO END to the cuts needed to balance the budget. No legislative relief is in sight.

What does $230,000 look like?

EACH OF THESE EQUALS APPROXIMATELY THE $230,000 NEEDED TO BALANCE THE BUDGET FOR ONE YEAR:

4-5 Classroom Teachers Entire K-12 Sports Program Half of the K-12 Art Program More than a third of the K-12 Music Program Half of Technology Instruction Half of the Foreign Language Program

Actions taken to stay within the State Imposed Revenue Cap

Restrictions

1) Prepared 5-Year financial projections.2) Reduced school building budgets for

supplies and equipment so they are now 7% less than they were in 1993-1994.

3) Reduced staff (attritions when possible).4) Employed energy savings strategies.5) Settled labor contracts within the amount

budgeted.

Staff Reductions and Restorations

Dealing with the Structural Deficit2000-05

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000

$900,000

Co

st

Series2 $826,500 $130,000 $696,500

Staff Reductions / Building & Supply

Positions Reinstated

Positions Not Reinstated

2000-01

MS Custodian $45,000

MS Phy Ed Teacher $50,000

2002-03

Assistant Dir. of Instruction* $80,000

Barrie 3rd Grade Teacher $50,000

MS Science Teacher $50,000

HS Business Teacher $50,000

HS Science $50,000

MS Aide $30,000

Purdy Aide $4,500

2003-04

Elem IMC Director** $50,000

Luther ED Teacher $40,000

Elem Art partial $24,000

7% Building & supply cut $143,000

2004-05

Elem Guidance $80,000

MS Math Teacher $72,000

HS Assistant Principal* $80,000

*Half of each position reinstated** Position reinstated, 2004-05

Dealing with the Structural Deficit2000-05

Dollar amounts below include wages and fringe benefits

A Brief Review of the Past

The State-imposed Revenue Cap began in 1993-94.

Staff reductions and a one-time 7% supply and equipment budget cut were made during the past 11 years.

Student enrollments were declining until 2003-2004, but have increased in each of the last two years.

There is a direct relationship between student enrollment and the amount of revenue available for day-to-day operations under the Revenue Cap.

The unexpected increase of 40 students last September resulted in the equivalent of a $110,000 increase in the Revenue Cap.

What Is Happening Now

• Increasing numbers of students from surrounding school districts are attending our schools under Wisconsin’s “Open Enrollment” law.

• Each open enrollment student brings about $5,600 of additional revenue to our school district.

• The structural deficit is not expected to begin to create a financial problem until 2007-2008 due to a combination of cost reductions in prior years and recent unexpected increases in student enrollment.

• The heating, ventilating and air conditioning replacements and upgrades will not be recurring costs, but under current law the structural financial deficit and technology needs will be recurring.

Concerns for the Future

The Board of Education is concerned about:

• Maintaining and extending the useful life of our school buildings and reducing energy costs with more efficient heating, ventilating and air conditioning systems.

• Being able to continue to provide the excellent educational programs that equip our students for a productive and fulfilling life.

• Being able to continue to provide students and staff with adequate computers and technology to enhance efficiency and increase student achievement.

A Solution Being Considered

The Board of Education is considering:• Having a referendum election next

October (2005) to ask electors for their approval to exceed the Revenue Cap to address each of these three major challenges.

A RARE Opportunity

• Having two plus years without an anticipated shortage of operating funds creates a rare opportunity—an opportunity to address the large non-recurring and recurring issues one at a time rather than simultaneously.

• If electors approve a referendum permitting the School District to exceed the Revenue Cap by a fixed amount on a recurring basis, those additional funds can be used in the next several years to complete the necessary heating, ventilating and air conditioning work before the additional funds are needed on an ongoing basis for operations (due to the structural deficit).

• This opportunity is likely to be rare because this is the first time it has occurred since the Revenue Cap was enacted 12 years ago, and there is no indication the Revenue Cap is likely to be repealed anytime soon.

Conceptual Illustration of the Use of Referendum Funds

Re

fere

nd

um

Am

ou

nt

$2

.1M

2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

…And If We Don’t Take Advantage of the

Opportunity...

• Based on current projections we have about a 3 year window of opportunity.

• If we delay one year, about 1/3 of that opportunity will be lost. If we delay two years, about 2/3 of that opportunity will be lost. If we delay three years, there will no longer be any significant opportunity—but the 3 challenges will remain.

• At that point, based on the best information available at this time, it would be necessary to “piggyback” the heating, ventilating and air conditioning work on top of the structural financial deficit which, at least for a time, would significantly increase the additional burden for taxpayers.

What will this cost the taxpayer?

• The Board of Education is in the process of determining what is reasonable to bring to the taxpayer.

• One thing for certain, it is cheaper now than it will be later.

• There is a fine line between what a community can afford and how we keep our schools excellent.

How Does a Geothermal System Work?

1. It essentially uses the earth as a reservoir of energy.A. In winter, heat is taken from the earth to heat the building.B. In summer, heat is taken from the building and deposited in the earth.

2. A geothermal system uses about 20% more electricity, but no natural gas or other fuel to create heat.

PopularMechanics.com

Vertical Borefield

Advantages of a Geothermal System

No gas, oil, or coal is needed to heat the buildings.

Each room has its own heat pump, so the temperature in each room is independent of the temperature in the rest of the building.

Only the individual rooms that are being used need to be heated or cooled—not the entire section or zone of the building in which the room(s) are located.

Additional Advantages of Geothermal

The system can literally take heat from a room that is too warm and transfer it to a different room that is too cool.

The equipment used for heating is the same as that used for air conditioning, so the additional cost for air conditioning is essentially the cost of operation.

The engineers tell us that we can heat and air condition the 4 buildings with geothermal for $89,325 less per year than it now costs to just heat those 4 buildings at today’s energy prices.

Disadvantages of Geothermal

This initial cost is about 12-15% more than a multi-zone or rooftop system.

The area outside where the holes are drilled is messed up temporarily.

Estimated Annual Property Tax Increase

Property Tax Value Increase$100,000 $177.79$139,000* $247.12

$150,000 $266.68$200,000 $355.57

*Average Homeowner

Property Tax Levy History

1993-1994 $ 9,150,0452004-2005 $11,298,534

The 11 changes ranged from areduction of 9.22% to an

Increase of 16.18%.The average change was 1.94%

History of Property Tax Levy Adjustments in

October

Over the past 25 years:8 tax increases

15 tax reductions2 years of no change

Net change = <$1,808,081>

History of Property Tax Levy Adjustments in

October

Over 14 years prior to Revenue Cap:4 tax increases8 tax reductions

2 years of no changeNet change = <$570,558>

We Will Continue to Share Our Ideas With You--Share Yours With

Us

We will be providing additional information as it becomes available, and as decisions are made by the Board of Education.

Your interest in your schools is appreciated, and your thoughts and suggestions are welcomed.

Timeline for Referendum

• Wednesday, June 8, 2005 at 6 p.m. in the Luther Board Room - The Board of Education will hold a special meeting in open session to discuss the structure, amount, and date of the October referendum.  Mr. Thomas Griggs, an attorney from Godfrey and Kahn Law Offices, will be on hand to advise the Board on the structuring of a referendum question(s).

• Monday, June 13, 2005 at 7 p.m. in the Luther Board Room - This will be the regular meeting of the Board of Education for the month of June.  At this meeting, it is anticipated that the Board of Education will formerly approve the structure, amount, and date of the referendum to be held in October.

• Pending Board approval on June 13, presentations will continue throughout the summer and fall to groups of individuals and organizations in our efforts to educate and inform the citizens of Fort Atkinson about the referendum.

• A steering committee headed by Mr. Paul Hable will meet throughout the summer in organizing a citizen’s committee effort to successfully pass the referendum in October. 

In Summary

Our three challenges are interdependent. We have a rare opportunity now to

upgrade our buildings. A successful referendum allows us to

meet our building needs and maintain our excellent programs for several years into the future.

Strong school systems contribute to the vitality of a community. We have an opportunity to plan now and remain a great school system.

Conceptual Illustration of the Use of Referendum Funds

Re

fere

nd

um

Am

ou

nt

$2

.1M

2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

Conceptual Illustration of theUse of Referendum Funds

Thank You!

Maintaining the public trust of stakeholders and citizens is

foremost to the Board of Education, the entire

governance team and the School District of Fort Atkinson