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President of Muncie Teachers Association responds to fact-finder’s report

MUNCIE, Ind. (WISH) — A state fact-finder report from the Indiana Education Employment Relations Board (IEERB) has sided with the Muncie Teachers Association in an ongoing dispute with Muncie Community Schools.

The issue is over what cuts need to be made as the district faces a $15 million deficit.

The report overwhelmingly sided with the Muncie Teachers Association, calling the district’s proposal to make pay cuts of 10-20 percent to teacher salaries and close one to five school buildings “extremely aggressive.”

Numerous times throughout the 30-page document the fact-finder describes the district’s proposals as “lacking evidence and data.” At times, the report also features words like “haphazard” and “perplexing.”

“Our position has been, yes we have debt. We aren’t denying that. We need to keep cutting away at the debt. The state has not sent anything to Muncie saying, ‘You do it in a year or two years,’” said Pat Kennedy, president of the Muncie Teachers Association.

Kennedy said under the MTA proposal, teachers will not get pay increases, and they will pay more for health insurance. Under the MTA proposal, health insurance costs for a teacher with single coverage would more than double, according to an I-Team 8 review of the state fact-finder’s ruling.

Teachers will also lose a professional development stipend and extra compensation for additional assignments, like teaching an extra class at the high school.

“We approached it from: what can teachers live with and still make a livable wage here in Muncie,” said Kennedy.

The IEERB report found those cuts reasonable.

The report also includes harsh allegations against the district.

It says Muncie Community Schools “intended to make the appearance of a decreased percentage of revenue available to fund the LBO (last best offer) in an effort to retain a larger portion of available revenue for application to its significant debt. The Fact Finder is not persuaded.”

According to the report, the district also accumulated a surplus of more than $4 million that should have applied to its deficit.

Additionally, the report accuses the district of using misusing a more than $10 million bond that was supposed to go toward facility renovations and upgrades.

“MCS’s use of these funds for purposes that may result in the voiding of the General Obligation Bond has created the serious financial obligations facing MCS presently and also creates questions regarding MCS’s integrity and its modeling of district principles of transparency and ethical behavior with respect to financial concerns,” states the IEERB report.

“The fact finder very clearly knew that you can’t cut debt by devastating a community and a school system because then you end up where everyone is the loser,” said Kennedy.

24-Hour News 8 spoke with several school board members on Saturday. They directed us to a district spokesperson who released a statement.

That statement can be found below.

The district now has 30 days to appeal the results of the fact-finder’s report.

The response from Muncie Community Schools:

Dear MCS Stakeholder:

The Fact Finder appointed by the Indiana Educational Employment Relations Board (IEERB) handed down her opinion on Friday regarding which collective bargaining agreement would be put in place. The MTA’s last best offer (LBO) or the Board’s LBO. Unfortunately, the MTA and the Board were unable to come to an agreement over the last 20 months.

The lack of agreement was generally over the size and impact of MCS’s structural deficit and the impact of unfunded liabilities from previous years.

Unfortunately for all involved, this is a situation that took more than a decade to create. However, immediate steps must be taken to address the current cash flow issues in MCS to ensure that MCS is able to pay its staff and vendors. Changes in state funding and the property tax caps have definitely have had a negative impact on MCS’s financial situation, but MCS’s lack of responsiveness to those changes have made the situation worse as well. Additionally, significant fiscal issues have been raised by the biannual audits by the State Board of Accounts, but MCS failed to act decisively to address many of those issues.

MCS has asked both the City of Muncie and the Muncie Redevelopment Commission for help through its TIF funding, but at this point in time, no funds have been forthcoming.

The City of Muncie has provided some in kind services to MCS such as assistance in plowing and salting parking lots, etc. MCS has also asked state officials for assistance.

Some seem to think that these avenues have been untried. That is not accurate. Members of both houses and both parties at the state house have heard from MCS’s leadership about the needs of MCS. Some assistance has come in the form of legislative changes, but it has been clear any funding will most likely have to come through the Distressed Unit Appeals Board (DUAB) process. MCS did previously ask the DUAB for funding, but was turned down. MCS went to the tax payers directly with a request for a referendum November 5, 2013; that referendum was soundly defeated with 54% of voters voting against the ballot measure. MCS has also been slow to respond to its declining enrollment and has more schools than projections show that it will need over the next decade.

The options described in the paragraph above being exhausted leave MCS little choice but to make significant reductions to operational costs. With the MTA’s LBO being selected, MCS will continue to be burdened with much higher than average insurance costs for its employees. The Board may appeal the decision since we believe it will cause continued deficit financing.

Additionally, MCS will have to investigate all other ways to reduce costs. Simply to make up the projected increased costs of the teachers’ insurance plan, we will need to cut nearly $2 million. This is about the amount saved by closing four elementary schools and a middle school. However, MCS must live within its means; all other MCS staff members have already seen reductions in either compensation and/or insurance benefits. MCS regrets having to make additional cuts and close schools, but the fiscal realities make this necessary in order to remain viable.

The Fact Finder’s decision, which we hope will be overturned on appeal, leaves MCS in potentially the most perilous fiscal situation in the state. MCS will renew its efforts to reach out to all entities that can potentially be of assistance and would urge each individual to do the same. Difficult decisions to reduce MCS’s physical footprint will need to be made shortly. MCS still holds out hope that the community will be able to work together to move forward towards the vision of a digitally rich instructional environment that educates the whole child and provides children and their families the resources necessary to be successful today and throughout life.”

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