Bloomfield School Budget Crisis: Layoffs, Outsourcing, Over-payment of Health Benefits Claims

Bloomfield School Budget Crisis: Layoffs, Outsourcing, Over-payment of Health Benefits ClaimsAfter several marathon public meetings over the past three weeks, the Bloomfield Board of Education presented another revised version of the 2013-14 school budget at a special meeting on Tuesday evening.

In order to save teachers’ positions, the administration is considering outsourcing child study teams, custodial staff and school nurses, affecting a total of 52 employees. In addition, expenditures related to Bloomfield school athletics could be reduced for the 2014 school season, pending approval of a possible public question on the November election ballot.

The deadline to approve the budget, which is subject to a state-mandated cap of 2%, is March 27, with a final public hearing set for March 26, 2013.

Although still a work in progress, the budget, when proposed earlier this month, was just short of $96 million, resulting in a tax levy of $66.5 million, according to Bloomfield Life.

The budget had been hotly debated since late February when the public became aware there was a significant shortfall in the school budget. The budget proposed at the February 26 meeting would have cut over 100 teachers as well as some members of the administrative and secretarial staffs.

That budget was voted down by the Board of Education after members of the public, teachers and other school staff members spoke at length about the detrimental effects the cutbacks would cause, including larger class sizes in already-overcrowded schools.

During subsequent meetings on March 5, March 12 and March 17, the BOE continued to wrestle with the details of the budget, and heard more impassioned pleas by the public and the teachers to save the teachers’ jobs. Some suggested that athletics or technology be sacrificed in order to ensure class sizes stay small and that children’s education is not compromised.

Over the course of those meetings, the number of layoffs was whittled down to 98 (86 teachers), and after the March 17 meeting, down to 54.

Superintendent Jason Bing, who joined the school not quite two years ago, explained the budget crisis was a result of a number of factors, including:

  • The fact that the school budget had not budgeted to the full cap in almost ten years in order to keep taxes down. In fact, three budgets ago, the school district actually had a zero percent increase in school taxes. This led to the school district having no substantial savings.

  • For various reasons, town ratables have decreased $125 million over the past two years, thereby lowering the amount of taxes collected to benefit the schools.

  • The State of New Jersey has underfunded the Bloomfield School District over the past decade and imposed the 2% cap, while requiring other mandates that create unfunded expenditures for the school system.

  • Special Education costs have increased significantly due to an increase in new Special Education students.

During a presentation to the public at the March 12th meeting, Bing also revealed that after the district hired a new accounting firm, an audit found that the district had overpaid $883,000 in excess of health benefit claims, an expense the district was not able to recoup. In addition, the auditors found there were 17 other areas in need of remediation.

Bing also said that rumors that the district had been underfunding their health insurance were correct, and that the administration had recently come to an agreement with Cigna to pay $2.1 million by July 1st.

The public will have one more opportunity to comment on the budget at the public hearing scheduled for Tuesday, March 26, 2013, at the Bloomfield High School Auditorium.

Read the latest Preliminary Budget in its entirety here.

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1 COMMENT

  1. So I have two questions on this whole situation.

    1. If we OVERPAID Cigna, why won’t they reimburse the district OR at the very least deduct it from the $2.1M they say is owed to them.

    2. How come no one is addressing the white elephant in the room. Why is the former BA, who put in for his resignation, being paid until June 30,2013??

    From the 1/8/2013 BOE Meeting, Resolution 388, Attachment LOA:

    Michael Derderian
    Business Administrator
    Administration Building
    Eff. 613012013
    Re. Resignation

    Yet on the same report, Resolution 391, Attachment R we see:

    Michael Dederian
    Business Administrator
    Administration Building
    Paid LOA
    Eff. 1212112012-613012013

    If we are in such dire straits, seemingly caused in part by finanical oversights, why is Derderian’s resignation which was submitted December 2012 be in effect until June 30, 2012 and why is is on PAID LOA status?

    Additionally in the 1/24/13 article in the Bloomfield Life it states the following. Of particular interest is the LAST corrective paragraph:

    Interim Bloomfield administrator hired

    Monday, January 14, 2013 Last updated: Tuesday January 15, 2013, 5:01 PM

    BY JEFF FRANKEL
    STAFF WRITER
    Bloomfield Life

    Bloomfield Public Schools Business Administrator Michael Derderian is no longer serving as Bloomfield Public Schools’ business administrator.

    Bloomfield Public Schools Business Administrator Michael Derderian has resigned.

    The board voted Tuesday, Jan. 8, on James Verbist of Paramus as interim business administrator and board secretary. Verbist will make $625 a day, starting “on or around” Monday, Jan. 14.

    Derderian earned $146,044 annually, according to public record databases.

    Board member Emily Smith said Verbist has previous business administrator experience, but did not specify where. Verbist previously worked as schools business administrator in Rockaway Township, according to news reports.

    “He’ll be serving as an interim until the dust settles. Sometimes change is good,” said Smith.

    Superintendent Jason Bing and Board President Mary Shaughnessy could not be reached for comment.

    At his last public appearance at the Dec. 18 board meeting, Derderian said most school improvements were put on hold in light of the district facing a budget crunch.

    Email: frankel@northjersey.com

    CORRECTION: In a previous version of this article, Bloomfield Life incorrectly stated that Bloomfield Board of Education member Emily Smith said that Bloomfield Public Schools Business Administrator Michael Derderian resigned prior to the December holiday break. Smith did not state that Michael Derderian resigned prior to the December holiday break, rather, she confirmed only that the agenda for the open session of the Bloomfield Board of Education, held on Jan. 8, 2013, contained a resolution for Michael Derderian’s leave of absence to be effective before the December holiday break.

    So what is it people? Has he resigned? If so, why is he out on paid LOA??