Illinois ASBO Facing the Top Financial Challenges of 2011

1. Illinois ASBOFacing the Top Financial Challenges of 2011 May 18, 2011

2. The Presenters • Dr. Frank Evans, Director of Business & Operations, Salt Creek School District 48 • Dr. Suzan Hebson, Assistant Superintendent for Communication & Instruction, Township High School District 113 (Deerfield-Highland Park) • Ms. Tammie Beckwith Schallmo, Managing Director, PMA Securities, Inc. • Mr. Barry Bolek, Assistant Superintendent for Business, Township High School District 113 (Deerfield-Highland Park)

3. Today’s Discussion • How do the political roles of the Board of Education and the superintendent impact the financial management of a school district? • How do they impact the effectiveness of a chief school business official? • How do they impact the financial messages the District needs to deliver to the community?

4. Introduction • Dr. Frank Evans • Currently works part time for Salt Creek School District #48 as Director of Operations & Business Services/District Treasurer • Served as Superintendent of Schools of two high school and two unit school districts, prior to retiring in June 2004 • Worked closely with the chief school business officials in each district • While serving the Macomb Community Unit School District #185 the District received six ASBO International Certificates of Excellence in Financial Reporting

5. Political Roles of the Board of Education and the Superintendent • Impact on the financial management of a school district • Accountability • Dealing with conflict • Communication

6. Accountability • Attributes • Focus on the end goal/bottom line/results • Valuing of others • Keeps promises and honor commitments • Willingness to delegate

7. Accountability • Skills • Focus on outcomes more than means • Practice characteristics of effective decision making • Set high expectations for everyone • Practice conflict resolution skills • Design accurate performance indicators to hold everyone accountable • Identify what needs to be tight versus loose control • Appreciate, value and recognize each person in the organization

8. Accountability • Knowledge • Board, superintendent, and business official roles and responsibilities in implementing plans • What to evaluate • Board Policy and Administrative Procedures • State and federal laws • Empowerment to create felt ownership and responsibility • Synergy

9. Dealing with conflict • About conflict • Conflict is inevitable • Conflict develops because we are dealing with people’s lives, jobs, children, pride, self-concept, ego, and sense of mission or purpose • Early indicators of conflict can be recognized • Although inevitable, conflict can be minimized, diverted, and/or resolved

10. Dealing with conflict • Beginnings of conflict • Poor communication • Seeking power • Dissatisfaction with management style • Weak leadership • Lack of openness • Change in leadership

11. Dealing with conflict • Conflict indicators • Body language • Disagreements, regardless of issue • Withholding bad news • Surprises • Strong public statements • Airing disagreements through media • Conflicts in value system

12. Dealing with conflict • Conflict indicators • Desire for power • Increasing lack of respect • Open disagreement • Lack of candor on budget problems or other sensitive issues • Lack of clear goals • No discussion of progress, failure relative to goals, failure to evaluate fairly, thoroughly, or at all

13. Dealing with conflict • Conflict is destructive when it • Takes attention away from other important activities • Undermines morale or self-concept • Polarizes people and groups, reducing cooperation • Increases or Sharpens difference • Leads to irresponsible and harmful behavior, such as fighting, name-calling

14. Dealing with conflict • Conflict is constructive when it • Results in clarification of important problems and issues • Results in solutions to problems • Involves people in resolving issues important to them • Causes authentic communication • Helps release emotion, anxiety, and stress • Builds cooperation among people through learning more about each other

15. Dealing with conflict • Techniques for avoiding and/or resolving conflict • Meet conflict head on • Set goals • Plan for and communicate frequently • Be honest about concerns • Agree to disagree – understand that healthy disagreement would build better decisions • Get individual ego out of management style • Let your team create – people will support what they help to create

16. Dealing with conflict • Techniques for avoiding and/or resolving conflict • Discuss differences in values openly • Continually stress the importance of following policy • Communicate honestly – avoid playing “gotcha” type games • Provide more data and information than is needed • Develop a sound management system

17. Dealing with conflict • Causes of Superintendent and CSBO conflict with the Board • Board members trying to be administrators overstepping authority • Making promises as Board members individually • Involving themselves in labor relations or budgetary minutia • Not doing their “homework” and failing to prepare for meetings • Not following procedures for handling complaints

18. Dealing with conflict • Causes of Superintendent and CSBO conflict with the Board • Not keeping executive session information confidential • Failing to act on sensitive issues • Failing to be open and honest • Making decisions based on preconceived notions • Not supporting the superintendent and CSBO – lack of loyalty • Springing surprises at meetings • Having hidden agendas

19. Dealing with conflict • Causes of Board conflict with the Superintendent and CSBO • Not treating board members alike • Not informing the board members of public concerns • Not providing adequate financial data or adequate information • Using poor public management practices • Making public statements before informing the board • Failing to be open and honest with the board

20. Dealing with conflict • Causes of Board conflict with the Superintendent and CSBO • Not providing alternatives in an objective manner • Not adjusting to the new reality of an involved board • Not supporting the Board – lack of loyalty • Springing surprises at meetings • Having hidden agendas

21. Dealing with conflict • Elements of a strong partnership • Full disclosure • Frequent two-way communication • Careful planning • Informal interaction • Periodic evaluation • Mutual support

22. Dealing with conflict • Courageous decision controversies usually involve • Changes in the way “we’ve always done things” • Notions of fundamental values • Determined, articulate advocates for every side • Inability to compromise • Rampant rumors • Threats of retaliation at the polls, levy, next bond issue • Board election

23. Communication • Eleven Commandments of communication • Be yourself: The most effective thing in effective communication is to be yourself. Avoid technical jargon or fancy pretentious language. It does not impress anyone. In fact it confuses people and cuts you off from the intended audience • Be comfortable and confident: Relax and remember that you probably know more about your subject than anyone else in the audience

24. Communication • Eleven Commandments of communication • Be honest: If you don’t know the answer to questions, admit it. Your credibility is crucial. Don’t jeopardize it. • Be brief: Keep it short and simple. You’ll look and sound better if you get right to the point. • Be human: Don’t be afraid to use humor. It promotes a friendly and confident image. • Be personal: Personal stories and anecdotes help get an idea or concept across because of your personal insight.

25. Communication • Eleven Commandments of communication • Be positive and consistent: Keep your goals in mind and stick to them. Control and focus all of your material. • Be attentive: Concentrate – don’t be concerned with any distraction. Listen carefully to any questions asked. Say what you mean and mean what you say. • Be energetic: Use gestures, facial expressions and body language to add vitality to your words

26. Communication • Eleven Commandments of communication • Be committed and sincere: Speak convincingly. Don’t be afraid to pause. Every time you open your mouth, look and sound as if you really care. We all know that poor communication is often the result of many factors. • Keep your voice conversational:but imagine it has a “face” which can show different emotions and expressions.

27. Case Study – THSD 113 Long Range Facility/Technology Plan Community Engagement Process Referendum Campaign, April 2011 133 Million Dollar Referendum Campaign Communication Key Messages Website Materials Financial Stewardship—CAFR Award, AAA rating Academic Excellence FAQs/Video Tours/Video Comparative/Listen and Learn Print Material Campaign Project Details No-Tax Rate Increase “Education First” - Develop a “Better Plan” Did Not Argue Need - Disagreed re Priorities and Overall Cost

28. Long-Range Facility/Technology Plan In house 5-10 year comprehensive plan Defended the cost of an external facility master plan Vetted and hired architectural firm Track record of fiscal management Created Community Leadership Team Community Engagement Opportunities

29. Referendum Decision Community Leadership Team Recommendation vs. Board of Education Action Communication Campaign Focused on Financial Stewardship and Academic Excellence CAFR Award press release, AAA status, levy impact, monies spent in past for projects Open Houses, Train palm cards, Website publications Print materials mailed to homes—postcards and brochure Main Message Choice—No Tax Rate Increase Education First and a “Better Plan” Poke holes strategy was more effective However, we ultimately got opposition to agree and note that NEEDS exist—now must delve into priorities and timelines…different consensus process

30. The Impact of the Referendum Community members had many questions about the debt structure Projected changes in EAV Interest rate assumptions What is the impact if the referendum is successful? Or if it does not pass? The administration and Board were consistent about finance-related messages

31. Other Events That Trigger Public Attention Developing a plan for Technology and Facilities Presenting the plan to the board for acceptance Standard Levy Hearing Voting on the Levy Board vote on resolution for Referendum Teacher negotiations Teacher Aide 5 year Agreement

32. Ongoing Communication about Excellence Deliver a “get what you pay for” response balanced by strong oversight and careful financial stewardship—Board and Superintendent must be well educated and kept apprised of financial processes—involvement is consistent, ongoing, and trust/partnership is essential

33. Impact on the CSBO We continue to have a “Day Job” and tasks that will need to be done on a daily basis… don’t get sidetracked and overwhelmed Have a relationship with your Superintendent, Staff and Board with Calendars on what tasks have deadlines State reporting Levy, Budget, Audit and CAFR… the cycle will NEVER END Negotiations are the meat of any budget List annually areas of savings whether re-occurring or one time Strategize what to post to web and how to frame it Meet with the Finance Committee at least monthly

34. Practices that foster partnership and keep Board well- informed Friday packet—business manager section Check analysis assignments—Board of Education discussion and review Finance meetings—PMA reports twice per year to the Board—looking at trends—future forecasts and history review

35. Keep facts and procedures transparent We all hear the buzz word “transparent”… how to do this Put items on the web… How the Levy works How the budget is developed If reductions are made, who, how, when what does it mean Better to point a person to the web when you get a phone call or get a FOIA

36. Framing events and timelines Keep the message simple and factual Don’t stray from the message Keep the Board and Staff on same page with facts and not tangential comments Keep respect on front line for staff, board and the public Reinforce there are factors one can’t control

37. Business Page at District #113 Can be found http://dist113.org/depts/businessoffice/

38. Impact on the CSBO • When communicating with superintendent and board members the CSBO must be very aware of what they say and how it is being interpreted. • “The single biggest problem in communication is the illusion that it has taken place.” George Bernard Shaw, 1856-1950

39. Impact on the CSBO • Dialogue between the CSBO, superintendent, and board members in the public forum must be heard by the public • If something is not clear, then ask for clarification or restate what you believe you heard for verification from the sender • If an issue has the potential to cause the CSBO, superintendent, and board members, to become disagreeable, then address the issue privately

40. Impact on the CSBO • “The more elaborate our means of communication, the less we communicate.” Joseph Priestly, 1733-1804 • As a CSBO make your expectations for communication clear, assess the superintendent and board on those expectations • Employ formal and informal means of communication on a regular basis

41. Impact on the CSBO • All messages are received within a context that determines how the messages are interpreted • Congruity between the message and the medium is important, especially during a board meeting, because things are not only being interpreted by the people around the table, but also by staff, citizens, and media • There should be formal and informal communication procedures agreed upon by all

42. Impact on the CSBO • It is critical that the CSBO, board members and superintendent always tell each other the truth, which means revealing the beauty marks as well as the warts • Effective communication is three-way between the CSBO, superintendent, and board members

43. Impact on the CSBO • Effective communication results in understanding • Barriers to effective communication can be external and internal • The CSBO, superintendent, and board members, must be very aware of how the other perceives or interprets their message • The purpose of informal communication might be situational awareness (heads up), and should be done by the CSBO to the superintendent and board members

44. Impact on the CSBO • “Good communication is as stimulating as black coffee and just as hard to sleep after.” Anne Morrow Lindbergh