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Southmoreland director Fike presents dire outlook

| Saturday, Nov. 3, 2012, 12:02 a.m.

A Southmoreland School Director does not see a pretty financial picture in the district's future.

In Catherine Fike's words the district is staring at bankruptcy in the coming years.

“This is what's going to happen if something drastic isn't done,” she said at Thursday's meeting of the board. “If nothing is done about the way our school district is run and restructuring does not occur, we will be near or at bankruptcy in three or four years.”

Fike spoke long on her feelings about the financial future of the district at the meeting, stressing three areas where she said huge cost increases are expected — salaries, health care and contributions to the Pennsylvania School Employees Retirement System.

Fike based her report on a number of assumptions including those increases as well as unchanged state subsidies, no layoffs or furloughs and all buildings in the district remaining open.

She said she spent nine hours reviewing numbers and reports, citing her sources as the Pennsylvania School Board Association, the School Leader News, the Tribune Review and the Westmoreland Intermediate Unit. Her findings — she told the board — were the same as those presented by Business Manager Bill Salem in previous scenarios.

This would result in the need for huge tax increases and the evaporation of the fund balance, Fike said.

“I'm looking long-term,” she said. “We'll get through this year, we'll get through next year. That's not the problem.”

She reiterated a stance from earlier in the year that the district should look into closing the primary center and the administration building as a way to save money.

“I don't want my name associated with the economic downfall of this district,” Fike said. “I think we have to take some action to start planning for these things.”

School Director Levi Miller agreed the road ahead will be tough, but isn't certain it's as bad as Fike said. He reminded the board that there could always be changes at the state level in the coming years and who knows what that would mean for public education.

“I'm not quite as pessimistic,” Miller said.

Superintendent John Molnar did present the board a very preliminary look at expenditures and revenues for the 2013-14 budget, which shows revenues of about $25.1 million and expenditures at about $26.8 million, which would mean a $1.7 million shortfall.

He stressed it is extremely early in the process and much work will be done to alleviate as much of the projected shortfall as possible.

“(Salem) projected minimum revenues and maximum expenditures,” Molnar said after Thursday's meeting. “He gave the worst-case scenario and obviously you start whittling from there.”

Molnar said during the meeting that Salem based this early projection of a spending plan on “last year's numbers.”

“Again, this is Nov. 1,” he stressed. “There's no assurances on what the revenues are. That's where we're at a very early stage.”

The board's next meeting originally scheduled for Nov. 8 has been changed to 7 p.m. Nov. 13 at the middle school to allow board members, administration and others involved to attend the high school's annual powder puff football game.

Paul Paterra is a staff editor for Trib Total Media. He can be reached at 724-887-6101 or ppaterra@tribweb.com.

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