The Thompson School board plans to decide around first of the year how to cut about $4 million from its expenses by closing schools, redrawing boundaries or laying off staff, or through a combination of those “difficult choices.”

At a Wednesday meeting, the Board of Education discussed its goals for the district’s master plan committee in coming months as the volunteer group looks for ways to meet the needs of the current students, handle growth, take care of facilities facing $72 million in deferred maintenance and, at the same time, cut costs.

The district has been drawing about $4 million per year from its savings account for several years to operate its existing schools and is at the point where, in about two more years, that reserve will be gone.

The first plan to address that was to ask voters for a $288 million bond and an $11 million mill levy override to fix up and remodel existing schools and build two new ones in areas of the district where there are no schools and growth is occurring and to boost salaries and update curriculum.

Both measures failed during the November election.

So now, school board members are looking to district staff and the committee for recommended cuts to make up the amount coming out of reserves.

Though any cuts will likely be a combination of ideas, which will have ripple effects through the district, board member Dave Levy noted they will include staff cuts.

“I recommend the board see a plan of what cuts we need to make to balance the budget two years hence,” Levy said at the Wednesday school board meeting.

“Eighty-five percent of our budget is staff, so that amounts to staff cuts. That will be the tough charge that we need to face.”

The master plan committee, which is made up of district staff and community members, will look at growth trends, the overall budget and facilities needs and work on recommendations for the school board, explained Margaret Crespo, the chief operations officer.

They will discuss boundary changes and the effect on bus routes and costs as well as possible consolidation and closure of schools, what that would mean for the students and what would be the fate of the affected buildings.

They will discuss potentially cutting staff positions or programs, and how each of those decisions would affect each other as well as the students who attend Thompson Schools.

Their goals will be to find solutions for a very complex issue with many interconnected parts that involve not just current programs and students, but meeting the needs of a district that expects to have a few thousand more students over the next decade.

“We are growing, and the reality being that if we don’t have those systems in place for those families they will choose elsewhere to go,” Crespo said. “It will be a self-fulfilling prophecy”

Much of the school district’s funding is based on an allocation to the state per student, so the more students, the greater the funding. If new students attend school outside the district, additional money that Thompson could use to help its financial crisis would go to those outside schools.

“There are a lot of moving parts to the conversation,” Crespo added. “We’re in a competitive environment.”

The budget crisis within Thompson and other school districts began about a decade ago when the state, in order to balance its budget during the recession, created a formula that allows it to pay less to the school districts. Each year, Thompson takes a $14 million hit from that negative factor.

Surrounding districts have supplemented that funding by passing bonds and mill levy overrides paid for with tax increases, but recent efforts to do that within Thompson have been defeated, leading to upcoming cuts.

“Everybody on this board realizes we have a crisis here,” said Carl Langner, board member. “I don’t think the public ever got the message. My question for everybody in the room is, will it take a closure of one or two schools or a dismissal of hundred teachers to get the message across?

“To do that, we’ve got to wake up the sleeping giant.”

Crespo mentioned that the master plan committee may talk about whether a future bond issue would be an option to help with the goals, but Levy, for one, disagreed. He said voters strongly spoke against additional taxes, so he hopes the district will figure out how to “live within what we have.”

He added, “We send the wrong message to the public if we are still looking at an MLO or bond.”

The master plan committee will meet in August, and returning and new members will be brought up to speed on the existing parameters as well as the charge from the board — to look at all the factors and find a creative way to balance the budget and craft a capital construction plan. (Those goals will be up for a vote from the school board on June 21).

Then throughout the next several months, Crespo will update the board on the progress with the goal of having a detailed recommendation for all cuts and future plans by December or January.

Lori Hvizda Ward, board president, said she wants to hear the details as soon as possible, closer to December than January, so the community can offer input and know what is coming, so that if schools close or boundaries change, families will have the opportunity to plan.

Levy agreed, saying, “I don’t want to wait to the 11th hour to start discussing those cuts. I think the board and the community need to know the ramifications as soon as possible.”

Pamela Johnson: 970-699-5405, johnsonp@reporter-herald.com, www.twitter.com/RHPamelaJ.