'News Report and Quoted Statements Misinterpret Our Comments'

Board of Education member Donna Lane demanded to see a Board of Finance plan "in writing" to "backstop" the school district's medical reserve should it be depleted by a high number of claims before she voted on a motion to reduce the reserve by $542,000 at her board's Monday night meeting.

On Tuesday, Board of Finance Chairman Mark Reed and his Vice Chairman Michael Manjos wrote an email to Board of Education Chairman Darrell Trump saying they did not want people to "misinterpret" comments they made at a March 5 school board meeting as a commitment of the Board of Finance to provide a "backstop" for the medical reserve.

"Recent prompt us to write in the hopes of dispelling apparent confusion regarding a proposed policy concerning the Board of Education (BOE) Medical Reserve Fund (MRF)," Reed and Manjos wrote in Tuesday's email.

"At the March 5, 2012 BOE meeting at which we appeared, we put forward a suggestion to define a policy to potentially cover an insufficient MRF balance," the email continued. "News report and quoted statements misinterpret our comments as a commitment of the Board of Finance (BOF) to 'backstop' a shortfall, which is incorrect on two counts — first, we repeatedly stated we were appearing as individuals and not representing the BOF; and second, we clearly put this forward as a suggested proposal.

"In fact, recall that the action item from the meeting was that the BOE would take an attempt at a first draft of this policy, for subsequent discussion with the BOF; thus, suggestions that this should 'be in writing' are disingenuous and misleading."

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Trump said, "What they presented wasn't a written in stone guarantee from them. The Board of Education didn't take any action on it at all."

But on Wednesday, Lane stood by her statements.

"They said it at a meeting that they wouldn't go back on their word," Lane said. "Now they're saying 'You're misinterpreting what we actually said. Yeah we talked about this, but it's misinterpreted that we made this commitment that we're gonna do this.'"

Fellow school board member, Secretary Mark Hughes, shared her recollection of the March 5 meeting. Both Lane and Hughes also voted against cutting the medical reserve on Monday.

"I specifically do remember them saying they would backstop us," Hughes said, adding he would ask the district's technology director, Craig Tunks, to see if he could obtain a copy of the video footage from that meeting to double check.

During Monday night's Board of Education meeting, Supt. of Schools James Agostine said, "I have to go on their word. It's been televised. It's in public meeting minutes."

The Board of Education had decided to reduce its medical reserve fund by $542,000 by gradually lowering its monthly payments by a vote of 6-3.

Joseph "Jay" Fiorello of Ovation Benefits, a consultant to the Board of Education, told members reducing the medical reserve from about $2.7 million to $2.2 million would be "perfectly fine," accounting for 24-25 percent of the $9.1 million budget for claims.

Memories of March 5

On March 5, Reed and Manjos recommended that educators reduce the school district's medical reserve by more than $500,000 as one way to bring the Board of Education's spending increase for fiscal year 2012-13 down to zero without cutting teachers or programs.

Lane recalls Manjos suggesting a policy where the Board of Finance could set up a fund designation to use if a high number of medical claims lowers the district's reserve below acceptable levels. On Monday, she expressed concern that Manjos and Reed were not representing their entire board before the Board of Education voted to cut $542,000 from its medical reserve.

The Board of Education had reduced its medical reserve in 2009 and wound up with a $460,000 shortfall when it turned out to be a bad year for claims. Former Supt. of Schools Dr. Colleen Palmer built up the reserve after that and Lane and other board members want to avoid a similar scenario.

Trump said of Reed and Manjos "suggested proposal" of March 5, "The whole purpose of them coming and giving their proposal was to see if we could come to a mutual agreement to come down to zero. They saw this as a clever plan to do it without cutting teachers and programs.

"Ultimately, we did get cut to zero and the vote on Monday removed those funds to get it down to zero, and we believe we're in a safe place."

A Medical Reserve Policy

Trump said the Board of Education is working with Gabriela DiBlasi, finance director for Monroe Public Schools, on a policy for its medical reserve. It is currently in the school board's Finance Committee.

Lane said the committee is considering how to handle a surplus as well as a shortfall for the reserve fund.

Once the Board of Education completes a draft of the policy, Trump said the Board of Finance will receive copies to review and provide input.

"Then I think we would like to sit down with them and explore the opportunities of the proposal they put on the table," he said of Reed and Manjos' suggestion back in March.

At the end of their email, the finance board members expressed a willingness to work closely with the Board of Education.

"We look forward to receiving such a draft, and promise that we will promptly bring this to the BOF for consideration," Reed and Manjos wrote. "If you would like the BOF to take a first attempt instead, please let us know."