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With health insurance done, Janesville School Board turns to budget

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Frank Schultz
May 15, 2013

— As the Janesville School Board cleared a key hurdle Tuesday night, members were already looking forward to the next track meet.

The hurdle was approval of two new employee health plans and saving money by requiring employees to pay 10 percent of their health-care premiums, a big increase from the current 3 percent that most pay.

The next track meet is balancing the 2013-14 budget.

Board member Bill Sodemann lectured his colleagues as the health plans were about to go to a vote.

Sodemann calculated the health plans would save the district $3 million to $3.5 million, depending on how many employees select one plan or the other.

The district will realize another $3 million in savings when union employees start paying half their pension-plan contributions in the coming fiscal year, Sodemann said.

On the expense side, the board used $3.9 million of fund balance—a reserve of sorts—to balance the current year’s budget, so that amount needs to be covered for the coming year.

That means the board might have about $2 million more to spend than it did last year, Sodemann said, noting that the state aid picture remains murky and at the mercy of lawmakers.

At the same time, the board has approved or is considering pay increases, a capital improvements plan and an expansion of services for gifted students, among other spending items, Sodemann noted.

And Sodemann said he would no longer agree to delay the initiative to begin prefunding early-retirement benefits, something called for in accounting standards.

The district has always paid for the benefits in its annual budget, but the new standards consider those future benefit obligations as liabilities.

Board member Kevin Murray said he agreed with Sodemann 95 percent. Murray suggested that part of the $3.9 million in fund balance might not be spent this year, giving the board more breathing room.

But if the district doesn’t spend what it budgeted, it would lose state aid, the board was told.

Sodemann suggested excess funding could be spent this year on prefunding the benefits.

District Chief Financial Officer Keith Pennington was already on top of that. He said the board could do what Sodemann suggested, and he hoped to bring that proposal to the board in June.

As for the health plan vote, it was unanimous. Board member David DiStefano, whose profession is employee benefits, said he was “very proud of the benefits we’re going to be offering, and I think this will put the School District of Janesville at a competitive advantage” when it comes to recruiting high-quality staff.

DiStefano also noted that while the two plans are through Mercy Health System and the health-care consortium known as The Alliance, the district also approached Dean-St. Mary’s.

“We would have loved to have Dean participate, but at this time they’ve decided they don’t want to play ball,” DiStefano said.



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