WEBVTT

METADATA
Video-Count: 1
Video-1: youtube.com/watch?v=BMHrF6T4r08

NOTE
MEETING SECTIONS:

Part 1 (Video ID: BMHrF6T4r08):
- 00:09:59: Budget Adjustments: Urgency, Context, and Financial Realities
- 00:55:51: Board Member Questions: Comparing Cuts and Bonding Bill
- 00:56:07: Elizabeth: Comparing to 2021 Cuts & Community Concerns
- 00:57:28: Louise: Board Policy, Savings Account and Unrestricted Funds
- 01:01:13: Ryan: Enrollment Projections, Communications and Transportation
- 01:05:09: Melinda: Staff & Community Involvement for Decisions
- 01:07:17: Sami: Levy, Budget Availability, Cap and Deficit
- 01:13:47: Sharon: Open Seats, Repurposing Buildings and Maintenance
- 01:16:15: Policy Changes, Transition Program Name, Superintendent Report


Part: 1

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Mhm. >> Mhm. >> Mhm. >> Woo. >> Mhm. >> currently have the information before we leave for summer. And why is that important? Because when you come back when we come back to school, there is always an excitement that we want to

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build about kids coming back and families reconnecting with us. It's difficult to come back in August and be like, "Oh, and by the way, we need to cut budget." And so, we want this conversation around the budget to start now so that people are aware of what's happening and they're in tune. And I

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think most people when um they look at our school districts and when we hear in the in the in the news that, you know, a landfall of money fell onto school districts, I think it's important and I do a simple math of 2.67% comes in from the state. And when we

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negotiate contracts above 2.67, we are deficit spending. It's just that simple. We've heard a lot about benefits across every single Minnesota school district. The $11 million up there of increase, 7 million of that is just insurance costs.

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And so, that really is what had us go from 1.5% to 13.2. It's the settlement of contracts with the insurance rates that just continue to go up. And so, um as Kelly said, we are committed um to answering any

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questions for the board. As community members have questions, we will have a built-in website where they can submit questions as well as sharing any feedback and input that we get. But at the end of the day, when it comes to budget adjust- adjustments, well, we can get a lot of input and people will have

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differing views. Our executive cabinet will be putting together the final package that will come to the board. Um and our hope is that that would come no later than November so that as we prepare for staffing, we have some of those pieces in place. So, with that, um we would just open it

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up for any board members who have questions. Okay, thank you. Um I know board members will likely have a lot of questions regarding these topics, so we will start with Elizabeth and allow each board member to ask two to three questions so that everybody has an opportunity tonight. Thank you. Thank

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you, Chair Schwartz. Uh my first question is if uh the folks who are representing the the changes or the potential changes out there could just kind of compare this round of cuts with the ones that we went through in 2021 and how that might feel to the community

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uh based on the size that was then and and now. Right. No, that's a great question. Um and so, I did take a look back and in 20 we came That process uh played out in fall of 2020 and then January of 2021, those adjustments were brought to the school board for approval. At that time, it was about 10

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million in adjustments. So, when I went back and looked at our kind of expenditures at that point, it was about um 3.75% of our budget. And so, right now, if I do that math on our current budget, 13 million is just a little shy of that. It's probably about 13.4. So,

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it's very similar in size right now. We know that it'll continue to grow as our budget grows, but yeah. So, it's similar size. It still is Somebody asked me once, "What's the worst thing you have to do in your job?" And I said, "This, right?" It's We have value and we know that everything we have in the system is and we have to make some really

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difficult decisions and it's This is the worst. So, but yeah, that's a good question. It is similar sized. Great, thank you. And then my second question and then I can pass it to other board members is um thinking about the bonding bill that isn't quite finished. And then also going to communities and talking about

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cuts is like a tricky um needle to thread. And so, just kind of curious if you have any initial thoughts on how to talk about that with with community members cuz you were saying 3,000 open seats and I presume that those are not distributed evenly across all schools. And so, we're talking about something

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It's a big deal. Yeah, I can speak a little and then certainly if Ms. Jansen as well, but I I think as we talk um in our predecessor Director Pierson certainly was always bonds are for building, levies are for learning. And so, I think the reality that we have that those bond dollars cannot be spent for operational

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activities. And so, that's the challenge we face. We also know in that question, too, part of that question was if kind of a if, right? But without adding those space, we would have had to boundary earlier um and adjusted boundaries at that time. And so, certainly that didn't happen. We heard our community say, "No,

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we don't want boundary adjustments during that 5-year plan." Again, that was a 5-year plan. So. Okay, Louise. Um looking at the the board policy of 16 and 6/10%, which is about 2 months of our budget, um and seeing that as the

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savings account, the emergency fund, can you talk a little bit about how that's been used in the past or the importance of having that unrestricted money available to make sure operations run smoothly? Yeah, I would say it allows us two things. So, think during um the pandemic, right? That it allows maybe

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some flexibility as we're navigating maybe rough times as the state perhaps um doesn't come with enough dollars maybe to meet what we feel are needs as well, right? That certainly allows us to facilitate that. Maybe an unexpected drop in enrollment. We certainly saw

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that during the pandemic, right? That nobody could have anticipated that that's what that would look like in our schools and that's how it played out. So, having a fund balance I think is really important to allow us to weather those um times that maybe we have a little slim and you're like, "Oh, jeez, thank goodness we have this." Which I think is where we're at as well today to

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be able to bring that forward. I think similarly, um we've heard different things. Is 16.6 too much or too little? But I think 2% or 2 months, excuse me, fund balance, you know, when you think about how quickly money can go, right? Two months is really not that much. And so, I think

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for us, when we look at governmental guidance, um they range anywhere from, you know, some will say like 5% is really ideal, and you know, that makes me a little nervous because if something goes a little sideways, that's a real slim amount to have in our kind of uh savings account. But, I also want to be

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mindful that we don't want to have a 36% or a 50% fund balance that some districts do have because I think they're wanting to not um using the being good stewards of our taxpayer money, right? That that there's a too high as well. And so, I think that 16.6, I think we really worked hard to

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find a target that was acceptable, that met those needs, allowed us to weather those storms. And then, really the financial impact is that we know that it shows up in our um bond rating. So, when we have our bond calls, right? We just had one um this winter for our 2026A bond. And as they looked at that, one of

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the comments they continue to make, and even with 16.6 that they continue to make, is that that bond that percentage is still too low for what they feel comfortable with to raise our rating. Um and so, as they look at that, it certainly then that reflects um in interest rates as well. It's hard to

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quantify what that interest rate difference would be, but there certainly is impact that the higher your credit rating, right? In essence, you're a lower risk investment for people. Um kind of better quality in that they are it's more attractive to people. And so, they're willing to pay a better interest rate. And so, um for us then, we get a

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lower interest rate. So, uh they want you know, it's attractive to them, and so they'll be willing to take that. So, it does play out, and that's direct impact to our taxpayers eventually as well. Thank you. That's all I have. Ryan. I'm sure I have a question. So, per that [clears throat] survey, the the

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general community thinks that our enrollment is going to go up because of new housing Internally, we know that we estimate to be flat or slightly to decrease. So, when we bring our communications forward to the community, are we going to update them of that knowledge that we

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have the Math and Science Academy that has taken kids? We have less you know, less kids per household per demographics. Are we going to bring that forward and be up front with that so people know? Cuz the you know, the survey suggests that eight out of 10 people think we're

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going to we're growing. And the reality is we are not, so we should be up front about that, right? Yeah. Absolutely. >> And I would say that um as it relates to that, that's part of the reason that we are going to do a demographic study uh with Hazel Reinhardt. Uh if you recall,

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she's the state demographer who has done our one previously. And prior to that, uh when we were planning for the bond the first time, we didn't use a demographer. And then, there were a lot of questions about the district's numbers. And so, we already have reached out to Hazel. We're just trying to

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determine at what point in time on our planning are we going to call her in to help support that demographic study. Um because you're right, we know we have some changes with schools, so we want to take that into account. And we also hear from our communities there are a couple really big housing developments, one by

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Pine Hill, uh one on the other side of 61 um by for Newport. And so, there definitely are houses. It's again looking at how many of those are bringing in kids, but that will all be done through our demographic study. Very good. Uh second question would be we know that there's been some

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difficulties with transportation. So, how does that reflect in what we are expecting for budget deficit, especially if we have uh say new housing developments come up, but a smaller proportion of young students? How do we anticipate that is going to add cost, and how do we plan to deal

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with that? That's a hard question. I'm sorry. >> [laughter] >> I know Kelly and I were like, I think it And to that end, right? I think those are the difficulties that we face, right, in those projections. Certainly, we try to incorporate that. I think that's where the um

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demographic study will help inform some like, where do we think those students may or may not be coming from because they get pretty granular in um Hazel's report um by kind of location that would um feed into our schools. And so, we certainly [clears throat] have that information as we look to that. I think where we may see challenges continued is um as we

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pursue as we talked um as Jansen said, the program-based budgeting. So, we certainly have um transportation, you know, it's one on the dollar bill that we used to have. And so, that's certainly identified as an area that how can we make improvements up there? Because I think we're always prudent, whether it's my team in finance and

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payroll, um whether it's in TLS or, you know, no matter where across the district where it's a kind of shared effort, right? We certainly want to do that um to try to really minimize as best we can, but $13 million is really difficult to minimize. So, I think a shared responsibility with transportation as well. I wish I had a

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great answer for you, um but I think too, I know Dr. Hickey, um you know, we've talked about what sort of special ed programming could we maybe talk with 916 to perhaps offer programming closer in our district as opposed to traveling cuz some of the transportation costs are pertinent to that as well. Um and then,

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our general costs, can we just be a little more efficient in some of our routing? Is there perhaps somebody we could um consult with on that? I think >> One of the things we will also have a conversation about is less dollars typically means less service. And so, one of the things that I know we've

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talked about with the board is the adjustment of mileage. Remember, the state mileage is uh the state requires 2 miles bussing outside of 2 miles, and right now we have one for elementary, one and a half middle school, and two for high school. And while certainly not

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a fan of that, um other districts have had to do that to reduce budgets. So, I think that will certainly be something that would be on the table as well to consider and take a look at. Very good. Thank you. Melinda. Yeah, Elizabeth already got one of my questions answered, but

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another question I have is um as far as when we're looking at these difficult decisions like we had to do in 2021, um what type of involvement level will our staff and our community have in these things? And are we able to go out

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and like have some type of questionnaire or something to to get their thoughts on things? Yeah, we already have um a slide deck prepared that principals will be getting in May to deliver to staff before the end of the school year, which includes just an open Google submission Google

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form submission of questions, thoughts, comments, all of the things. [clears throat] Um and then, as I mentioned throughout the process, we will be having lots of feedback loops with staff, with with our kids, um with our community. So, there's

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certainly plans for that. We will have an email address that's just for planning for the next five years. Um so, we have And we are meeting twice a month as a as a leadership team to really focus on hearing those hearing those thoughts and incorporating those into our planning. So,

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I think that answered it, but I'm trying to think if I missed something. We That is one thing with the um with the community survey coming back that they think that we're doing a good job of communicating, even though we know that there will be disagreements or people won't like where we're going or whatever it may be, um we really hope that people

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understand why we made those decisions and um have the rationale behind them. And so, that's going to come through communication. That's good. That was the most horrible experience being on the board is having to make all those cuts in 2021. >> to stand up here and read those [laughter] lists.

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And I think we know too, um that uh when we have conversations, we know that there is always district interest. It's part of the board training. We know there's district interest, and then there's self-interest. And self-interest isn't selfish, it's just the perspective that people are coming in with. And so, that is kind of the balance of the

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process of getting feedback and asking. And I think what's interesting as we talk, um I've done a process like this many times in another school district as well. I think all three years I was a principal. Um Many times, the lists don't change a lot. The same items keep showing up. And so,

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we have all of the previous documents for our last budget adjustment process as a foundation as we go out and begin our work. Okay. Sami. Um So, one of the questions I had. We So, when we cut the budget in January of

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2021, we um like everyone says, worst worst day on the board. Um But, at the same you know, we we both cut cut the budget, and we also went out, and we asked our taxpayers to um

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for a levy to increase our funding, right? And we at that time, we had talked about um we did the revoke and and replace um for 10 years, and we were hoping to get without having to go back out to the taxpayers to ask for additional

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operating levy dollars. And I'm feeling like that maybe isn't going to happen, though I don't know. Um but with the for these budget adjustments that we're going to make for this 13 million deficit that we have, um

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So, this is sort of a two-pronged question. Can you remind us what the what available availability to the cap there is to cover for that? And then, secondly, um if we were to cut 13 million, you know, sort of on an ongoing basis,

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what is a reasonable time frame for us to expect those budget adjustments to hold before we have to go through another budget adjustment process? That's a really big capital H, capital F. I know. Um the with the second part particularly. So, to the cap, right? We know the state sets the cap, and it does float every

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year. So, it's a little bit challenging. I always say most recently, we're about $225 below the cap per student. So, certainly there's some revenue there, um but $4 million, you know, roughly. And that I you know, as Jansen talked earlier, we can't fund our way

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out of this deficit, right? Unlike last time where we were significantly under the cap at that point. Um and so, we certainly have a opportunity perhaps there that we could. There's additionally the capital projects levy um that's done a little differently. And so, certainly we um perhaps could take a

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look at. I think right now, when I looked at our budget, there's a roughly 4 million, 3.5 million that's not funded. So, I think um our technical our tech staff that's out in our buildings, particularly um supporting all the you know, devices, whether it's smart boards or panels and microphones and a lot of

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the um different devices as well along with laptops and you know, all the devices for students and staff. So, um I think when we look at that, there's certainly capacity of some there. So, I think as part of the five-year plan, we would we would certainly you know, that's a

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would come up as part of that, I think, right? Because there's a lot more moving parts to it and then when may might be a good time. Um, and I hate to say it, I don't know if there's ever a good time to go to our community and say, "Hey, we're cutting it also, can you give us more money?" Um, but I think the reality is we may have to do that just to allow those to extend

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a little further. So, to the second part as to how long that might get us, um you know, unfortunately, as we project out, right? That $13 million will likely still that may not get us out of in fact likely won't um get us out of deficit spending for a number of years yet. Um,

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so you know, it's so early to be able to predict me like, "What is this actually going to look like?" We know there's some big things, particularly enrollment, um you know, school remember Clark two years, you know, right? That uh kind of what does some of those school choice programs and that enrollment options look like for

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us. So, I think we have you know, we have some students that are so successful and we have some fabulous programming. And so, how do we highlight that too and really become attractive as well. So, I we will some work to do, I think, to be able to really highlight those things and so this was a wonderful opportunity this evening with those students, but it's not going to it won't

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get us out of deficit spending. Um, unfortunately. So, it will mitigate and with our 57 million, we'll be able to um kind of extend that a little longer while we have go through the five-year plan to really be able then to do this kind of short-term so at least it keeps us out

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of statutory operating debt for a bit. And then as we look to that five-year plan, what does that look like and what adjustments perhaps need to be done where is maybe some increased revenue opportunities as well. Okay. And Semi, I think that that goal of 2031 was an internal goal and it probably came from your superintendent,

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me. Um, why? Because it's difficult to go back out to the community every couple of years. And so, when you asked um what changed, I think the biggest change was the enrollment. I mean, when we're talking about 7 to 750 students because

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of the opening of another school, we know that that's over $8 million worth of funding. And so, that was one and then I would say the second is just the cost, the incredibly the the rising cost of benefits um and um the salaries in order to compete. I mean, those were to

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me the two biggest factors as I look at not being able to make it to that 2031. Um, and then my other question is just around um what are there other mechanisms we can put

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into place that would allow us to um close a funding gap. And I'm thinking um you know, will the state ever move to allow like, for example, us to levy for paid family leave or or levy for summer unemployment

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or levy for some of these mandates that they have um passed that require us to dip into our operating budget that we would prefer to spend, you know, more classroom based. And I would say that's where I think

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with um the importance of contacting our legislators, right? So, I think ideally, yes. I don't know that that's reality just in I'll say current environment at the state. Um, right now we're not anticipating a whole lot of change even. I saw my update last

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week was that the um omnibus went forward in one and the other failed to take up the omnibus. And so, it's challenging that way for the education piece. And so, I think absent our voices though it really in talking to our legislators, I think it's the importance of that, whether it's from our staff or whether it's from our community or whether it's from

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ourselves, I think that's the only way that we're going to gain traction, knowing that at some point too they have to try to balance their budget as well. And so, certainly they have challenges that they're facing additionally which kind of trickles down to us. So, Okay. Sharon? Okay. With uh 3,000 open

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seats and we're going to talk about um repurposing these buildings. What and they all will need maintenance, right? So, what would be the cost associated with repurposing or have we thought about opportunities for revenue?

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Yeah, I would I would just say that when it when we talk about repurposing, what we know is how many seats we have open right now and the inefficiencies with staffing, with transportation. I think it would depend upon what it was repurposed to. I think what we heard our community say loud and clear was,

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"Please don't close a school and sell it." Um, because in the event that enrollment increases that the district would would still own the building. And we know that we have one school here in Cottage Grove, um St. Paul Park, I think, um that the district at that time many, many years ago, um it closed and

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it was sold and people still haven't forgotten about that. So, I think it's important to honor the fact that the district would continue to own the buildings, but may repurpose it for other needs. And so, in terms of looking at that, Sharon, that would be part of the budget adjustment process and or the

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five-year planning. And that may be something that runs parallel together. You know, if we're thinking about elementary with open seats, maybe part of it is looking at repurposing to get to the $3 million worth of cuts, um but then some of it is just in staff or in

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people. So, I think it's a combination. And we have a couple buildings where there's less students, less student programming, I should say. You know, as [clears throat] a they they care less about adults as they should. We care more about our kids in our schools. So, we have the service center and the program center that are a lot adult

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programs. And so, what is something that we could benefit from those two buildings as well. Thanks. I think they Okay, I will share that I was in kindergarten when that and when I did my first door knocking, Grove Elementary. Yep.

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And I don't think that that's the legacy that anyone wants to leave and I think that there are opportunities for continued growth. We know that in our communities and perhaps someday uh uh the student count will go up and some of these homes will be taken over and I I think that we have um enough programs

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and needs in the district to do that and do that successfully. And all of my questions have been asked. So, thank you very much. Okay, we will move on to 8.0 and that is our action items. We do have two this evening. 8.1 is a proposed policy changes and that will be presented by

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Julie Nielsen, superintendent. Thank you. Um, this evening I am bringing forward our six policies from our last board meeting um and asking for your approval. And again, for the community, those are policies 509, enrollment of non-res, 510.1, athletic and activity

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participation, 510.2, athletic and activity scholarship eligibility, 510.3, athletic and activity fee schedules, 510.4, athletic and activity field trips, and then finally 512, school-sponsored student publications and activities. And this evening um I am

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asking for approval of those policies. Can I get a motion to approve? So moved. Second. Moved by Sharon, seconded by Awish. I thought so. Any comments on this? No? Okay. All those in favor? Aye. Opposed? Motion

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passes. Okay, 8.2 and that is our transition program name and that will be presented by Dr. Hickey, executive director of student support services. Good evening, Chair Schwartz, Superintendent Nielsen, members of the board. Tonight I'm asking for approval

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of our recommendation for the name of our new unified transition program serving our 18- to 22-year-old students with disabilities. It was discussed at our last workshop meeting. After a process of gathering input from our constituents, our recommendation for

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the name of our program is the SoWashCo Headwaters Life Skills Program. Headwaters represents the work we do in 18- to 22-year-old programming with young people with disabilities, growing and adapting as they begin their adulthood. We are asking for approval of

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this new name as we open our school for the fall of 2023. Can I get a motion to approve? So moved. Second. Moved by Melinda, seconded by Ryan. Any comments? Okay, hearing none. All those in favor?

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Aye. Opposed? Motion passes. Thank you. Okay, now we move on to 9.0 and that is our superintendent report. And I will just keep it brief. While we were celebrating a lot of students, this is the time of celebration. I think on my calendar, I have multiple events every week celebrating and recognizing our

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seniors, whether it be scholarships or awards. So, a lot of things happening out in the schools. And then finally, on Saturday, Cottage Grove will have their showcase at our very own Park High School. And again, a great opportunity for us to highlight our school district, any job openings that we have um as well

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as to just connect with other business people during the showcase. Okay, on to 10.0 and that is our future meeting dates. May 7th, 2026 is our school board workshop meeting here at the district service center at 6:00 p.m.

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May 21st is our school board business meeting also here at the district service center at 6:00 p.m. And with that, 11.0 and we are adjourned. >> Mhm.