Medford board raises school referendum talks

A scaled back version of a high school remodeling effort focusing solely on district needs could be coming to voters for approval as soon as next spring.

Members of the Medford school board on Monday started discussion on if the district should try again in April 2022 to pass a referendum for renovation and expansion of educational spaces at Medford Area Senior High School. Last spring voters soundly defeated a $39.9 million referendum which included extensive remodeling of classroom spaces especially in the technology and science areas, office and library. Included in that plan were a second gym and new theater.

District administrator Pat Sullivan suggested the board consider going back to the voters but this time cut both the gym and the theater from the plan. This would cut the referendum from $39.9 million to $23.4 million and focus solely on essential building needs.

“The message was pretty loud and clear we would not be asking for a theater and not asking for a gym,” Sullivan said.

The other change Sullivan said he would like to see in any potential future referendum is to construct an additional driveway across district property connecting CTH Q with the elementary and high school complex as a way to address traffic safety and safety concerns due to congestion particularly at the elementary school.

“We need better flow, and another way to get in and out,” Sullivan said.

Sullivan said the feedback he received following the last referendum was that people said they would have supported it without the gym and the theater, which were perceived by many voters as being wants versus needs.

Sullivan brought forward his recommendation at the request of board president Dave Fleegel who was seeking board member input on if they should restart discussion on addressing issues at the school for the next 30 years.

“Do we want to restart discussion?” he asked. State law allows schools to bring a referendum once per calendar year during a regularly scheduled election. Fleegel noted while there is not a fall election every year, there is a spring election each year.

Fleegel noted there is high demand for skilled trades workers, especially those skilled with CNC routers and other equipment. While Medford schools have opportunity to acquire these sorts of equipment the technology education spaces at the school do not have the space for them.

While supportive of restarting discussion for a referendum, Fleegel said he would understand if others thought it was “too soon” following last spring’s vote.

Fleegel said he felt the last referendum request was the lowest cost, best possible way to advance education and serve the needs of all students. “We talk about serving all students, not just yours, or your neighbor’s,” Fleegel said.

“Here is everything you loved about the last plan and nothing of what you hated,” said board member John Zuleger in support of restarting discussion on a future referendum.

Others on the board were more hesitant about potentially bringing something to voters in April 2022 questioning if enough time had passed in people’s minds from the previous attempt.

“I don’t know that it is enough time for people,” said board member Don Everhard.

Others were concerned if the district would have enough time to put a proposal together in time for a question to be put on the ballot. Sullivan said they could talk with Findorff, who assisted the school on the previous attempts and have them bring some options to the board for consideration.

Another factor for the school board is the application to seek federal grant funds through FEMA for a storm shelter space which, if approved, would be built in the current parking area between the high school and Raider Field with the current driveway in the area being turned into a one-lane access, as a result, any technology education building expansion would have to occur to the east of the current space. Sullivan cautioned that the district will not receive word on the grant until December 2022 and that they would be seeking donations to cover the local match to the federal grant. “We need to be ambassadors for donations,” he said. “No donation, in my mind, is too small.”

Board member Jodi Nuernberger said she wanted to see how things would come together before deciding if they should pursue a referendum. Board member Steve Deml agreed saying the discussion should take place and be on upcoming agendas. “It is not like it is just going away,” Deml said of the issues at the high school.

Board member Brian Hallgren agreed saying he felt the district should move forward and go to the voters with a referendum in April 2022.

Board members would have until December to decide on if they wanted to attempt an April 2022 referendum. Finance director Audra Brooks said she would bring back updated financing cost projections and potential tax impact. It was noted that due largely to paying off previous referendum debt, the district equalized tax rate is projected to drop from $8.33 per $1,000 of equalized value to around $6.34 per $1,000 of equalized value. Brooks said they are awaiting data for enrollment-based aid from the state in order to finalize the levy. That will be formally set at the October board meeting.

Insurance

Changes may be coming to school district employees’ health insurance as board members work with insurance brokers to reduce premium costs.

Last year the district went out to the market and solicited proposals for insurance before ultimately switching from Security Health Plan to an Aspirus Plan at a significant premium savings. However, with usage loss ratios remaining high for the past three years, Becky Gorst, an account executive with Spectrum Benefits Solution advised board members against seeking outside proposals this year and instead consider plan change options as a way to reduce costs.

The usage loss ratio has become the primary driver for health insurance renewal rates. This is the ratio between the amount of premiums collected and the amount of claims paid out. In 2019, the district had a loss ratio of 100.2%, in 2020 the district ended the year with a ratio of 121.8% and through August the district was at 99.9% usage. Anything above 100% means the insurance company paid out more in claims than it collected in premiums.

As is often the case with health insurance a handful of very large claims drive the usage ratio. In Medford’s situation, of the 963 members covered by the insurance, claims from 13 members accounted for 49% of the claims spent. Tim Ottosen of Aspirus Health Plan, noted that three of those individuals are no longer on the district’s health plan. This carries over into the prescription drug coverage portion of the plan with prescription coverage for a handful of specialized anti-cancer medications accounting for a jump in usage rates. Fortunately for Medford school district, when agreeing to switch to Aspirus last year they locked in a maximum renewal rate which based on the usage levels is at 12%. Aspirus came in with a combined renewal rate of 10.07% which will raise total district premiums from $5.6 million to $6.2 million.

However, as account executive Cory Toth-LaPointe of Spectrum noted, the actual increases vary based on the plan level and are skewed higher for the Rural Virtual Academy staff who are on the district’s health plan but who live outside of the coverage area. The increase breaks down to 9.5% for people on the standard plans, but 16.67% increase in premium cost for the employees who live outside the coverage plan. This plan category was created last year to continue to provide coverage for these employees.

Hallgren suggested the increased cost of those employees should come from the RVA’s budget to bring the expense to the Medford school district level with its other staff. RVA administrator Charlie Heckel agreed that he felt that would be fair. The RVA is a virtual charter school under the Medford school district and operates as a consortium with other districts who all share in running it.

Toth-LaPointe said there were ways the district could lower its overall premium and save money. The first option through Aspirus is to impose an additional co-pay for prescription drugs after the deductible is met of $20 for generics, $40 for name brand, $60 for preferred and 25% of the cost of speciality drugs up to $250 at the pharmacy level with a maximum out of pocket of $500 for single and $1,000 for family. This would effectively increase the out of pocket expenses for the highest insurance users who use this medication by $500 to $1,000 per year. Gorst noted that those on the high cost medications could work with the pharmaceutical companies to get that cost further reduced on a case by case basis. The net gain for the district for this proposed plan modification would be to reduce the aggregate rate increase to 7.64%, a savings of $136,935.

The second option would increase the deductibles for all members by $500 for single and $1,000 for family plans for the low-deductible option and shift the amount the district pays into the health savings account contributions. This could reduce the rate increase to 7.17% and save the district $163,523 in the renewal. However, as Gorst noted this option impacts far more members than imposing insurance copays after the deductible has been met. After a lengthy discussion, board members agreed to send the issue to the school’s finance committee for a recommendation to be made for action at the October meeting.

In other business, board members:

_ Viewed the curriculum connection explaining how curriculum is changed and that in Wisconsin curriculum and what textbooks and materials are used is decided at the local school board level. The district has a multi-year curriculum review process with the high school science curriculum currently being updated.

_ Discussed the need for board members to accompany district administrator Pat Sullivan as he attends municipal board meetings in the towns, village and city in the district. The district started these annual visits several years ago as a way to get feedback and share information about what the school is doing with the 14 municipalities that make up the school district.