In the wake of government-wide budget cuts, the Public School System is scrambling for ways to reduce its own expenses, with pay cuts among the several austerity measures under consideration to help it meet its many obligations.
Proposals like salary cuts for personnel earning more than $23,000 annually and a cash plan—best described as for “survival mode”—were discussed during a Board of Education Fiscal, Personnel and Administration Committee meeting the BOE conference room on Capitol Hill yesterday.
Due to the decline in revenue collections in the first and second quarters of the current fiscal year, the Office of Management and Budget has implemented a 15-percent cut across all government agencies, including PSS. However, this percentage cut has not been formally communicated to PSS yet.
Education Commissioner Glen Muña pointed out that the budget deficits are just projections at the moment.
“We have not received the definite percentage that we have to cut so we are just taking a practical approach that will help us so we can start to communicate with the Legislature,” he said.
At the House Ways & Means Committee meeting last Monday, PSS asked for an operating budget of $67 million for fiscal year 2020. However, based on the proposed budget submitted by Gov. Ralph DLG Torres to the Legislature, the government has only allotted it $36.7 million.
According to PSS Finance director Christopher Ching, austerity measures are already in place at PSS, including a salary freeze.
“This means no within-grade increases and, whenever someone resigns and it is locally funded, the full-time equivalent is evaluated whether it needs to be replaced or we can manage the school year and fiscal year without that employee,” he said.
Local travel has been suspended. The operating budget at the PSS central office has been adjusted. Energy conservation has been re-emphasized.
“Now we are even proposing [operating fund cuts] at the school level,” he added.
Ching said an operational budget cut in secondary schools for fiscal year 2019 has not been implemented yet as it is all on hold, pending discussion with school administrators.
Because of these cost-cutting measures, PSS has already been able to save $3 million, Ching said, but the total amount they have to save is $7.2 million.
“The decision to implement further budget cuts is a decision the board has to make, whether it’s cutting personnel or decide to incur obligations that we cannot pay such as [the Commonwealth Utilities Corp],” he added. “…hope next fiscal year when the economy is better that we can lobby to obtain funds for that.”
In the event PSS needs to further cut its operational costs down the road—after fiscal year 2019—Muña said that they might need to cut the salary of personnel.
“When we started identifying what operational cost we can cut, we try to protect employees as much as possible,” Muña said. “If we do need to do further cuts, our recommendation would be to do a salary cut on personnel.”
But, instead of an across-the-board pay cut, Muña recommends a formula. “What we are looking at is, for example, a vice principal before the compensation plan was earning $60,000 and now they are making $93,000. We will get the difference and divide it in half. This way, they will get the cut but won’t bring them down to $60,000.
“…The group that we are looking at would be from those earning $23,787 to $125,000 a year,” he added.
Muña believes that this method will soften the blow, “most especially among certified staff… “It would still create an impact but it will be not so hard for the teachers. …In terms of the savings that we will derive from that, we don’t have the numbers yet as we just finished the budget hearing,” he said.
“If we get the board’s blessing on this proposal, we will go back to the table and crunch the number of every single employee, answer questions like what was their salary before the compensation plan and then come up with a revised one,” he added.
BOE chair Janice Tenorio, who attended the meeting via a telephonic conference, said that pay cuts will hurt teachers.
“We need to look for other ways of cutting because these teachers are the front-liners that we should not touch. …We need to protect them,” she said. “…This is a temporary solution. …I am passionate about our front-liners and I see we are not doing this right.”
BOE vice chair Herman Atalig echoed Tenorio’s sentiments but, citing the budget cut implemented by the central government, he said it would be quite a feat not to include salary cuts.
“To not to include most people…and maybe teachers in the austerity measure is, to my mind, insane,” he said. “The hill that they [government] are giving us to climb is steep that not everyone would survive when we get up there.”
In order for PSS not to go in the red, the salary cuts of teachers will be inevitable, Muña said.
He said that most of the money that PSS gets goes to the school level and to pay for its certified staff—“that is where the bulk of the money is.”
“So if you want to make cuts and see savings so that we don’t end up in the red, that means we have to shift our conversations to include [salary cuts],” he said. “As much as I don’t want to cut [the salaries of] our certified staff, eventually we will have to.”
BOE member Marylou Ada stressed that the board should be united on this austerity measure. “We are all in this together and we must do it together,” she said.
The board has yet to vote on Muna’s recommendation on the salary cut for staff.
The next PSS board meeting will be held on May 30, 2019.