Association of School Business Officials Illinois 2013 Annual

Association of School Business Officials - Illinois 2013 Annual Conference Shared Services in K-12 Schools May 15, 2013 M Moderator: Anne Roth Presenters: Mel Diaz, Area VP, Gallagher Benefits Eric Miller, Assistant Superintendent, Skokie 69 Sarah J Millon, Business Manager, Hillside 93

Overview of Session 1. What are shared services? 2. Why should we share services? 3. How can we go about sharing services? Show of hands: How many are School Business Officials? Superintendents? Support Staff? Other?

Shared Services-What is it? *A way of organizing admin functions to optimize the delivery of cost effective, flexible and reliable services to organizations *Some share one contract * Share bid process, but have separate contracts Where is it reported? *AFR in IL *Other States have programs that are facilitated by the state and separate reporting Where is it practiced? *Public Sector *Private Sector

Shared Services-What

Shared Services-What -Examples of Shared Services: * Curriculum Planning *Educational Shared Programs * Energy Purchasing * Employee Benefits (Health, Dental, Life) * Property/Casualty Insurance * Legal Services *Special Education Cooperatives *Supply and Equipment Purchasing * Transportation * Administrative (Superintendent, Business Official)

Shared Services-What Case Study: Educational Benefit Cooperative (EBC) * Established in 1984 for the purpose of purchasing insurance * Current membership: 18, 000+ employees, representing 87 School Districts * Provides economies of scale and risk pooling (Medical, Dental, Life) * Self funded medical program with healthy reserve balance * Long term financial stability * Size allows for greater leverage with carrier and vendor partners

Shared Services-What Case Study: Educational Benefit Cooperative (EBC) Key Results/Benefits: * 5 Year Average Increase by Product: PPO: 4. 3% HMO: 6. 0% Dental: 0. 5% * Cooperative Funded Wellness Incentive Program * Cooperative Funded Eligibility/Benefits Administration System

Shared Services-What Case Study: Educational Benefit Cooperative (EBC) Key Results/Benefits: * Value Added Employee Assistance Program * Dedicated Compliance Unit * Dedicated Underwriting Team

Shared Services-Why Financial implications: • • • Lack of financial resources Desire to reduce administration costs Reduce headcount and salary/benefits Savings from streamlining process Economies of scale/purchasing power Examples: Joint Transportation Bid, Paper

Shared Services-Why Improved expertise: • • • Improve services and quality, accuracy and timeliness Group similar tasks and expertise for a critical mass Standardize/streamline services Simplify roll-out and IT systems support Advisory services = higher value Examples: Special Education Cooperative, Township Treasurer

Shared Services-Why Efficiency: • Only focus on one process, probably get pretty darn good at it! • Time savings, concentration on other areas • High volume transactional process = bigger savings • Examples: Substitute Cooperative, Healthcare (Reform)

Shared Services-Why Innovation and Collaboration: • Focus on central idea together • We’re all wrong on our own, but together we’re right! • Example: Financial Software

Shared Services-How do you get started? • • Relationships, Relationships Cost Benefit Analysis Create Proposal Draft Intergovernmental Agreement

Shared Services-How Relationships are key to getting started: • Networking amongst peers yields ideas for sharing • Reach out to municipality contacts to establish working relationship that can start conversation around sharing resources locally

Shared Services-How Mr. Russ Wajda Village of Hillside 425 Hillside Avenue Hillside, Illinois 60162 Dear Mr. Wajda: On behalf of Hillside School District 93, we thank you and the Village of Hillside for the continual support and partnership initiatives we have shared over the years, that include Hillside Village parade participation, use of our schools for Baseball practice, Hillside Scout meetings, as well as Fire Department and Honor Guard Testing and Training. As you may know, there has been a push by the State of Illinois for school districts, and municipalities, to explore and pursue, with their local governmental counterparts, shared services. We know the proverbial axe will eventually fall on local bodies to bear more of the states cost for pension, and perhaps other expenses. With that in mind, the District is being proactive in their efforts to continue to find operational and cost efficiencies in an environment of decreased school funding, and rising cost. To this end, as we look forward to future partnership initiatives, we are asking the Village to consider, an intergovernmental agreement with the District, to allow for shared services relative to gasoline and salt purchasing. As a village, the size of Hillside, you can take advantage of bulk pricing for gasoline and salt that the District our size can’t negotiate. We are therefore asking the village to allow the District to purchase its gasoline for its trucks, snow blowers, and lawn equipment, and salt for our driveways and walkways, from the village. Russ, it was great talking to you on Wednesday, and I hope to hear from you soon. As always, if you have questions or if we can be of further service to the Village, please do not hesitate to call me at (708) 449 -6490, extension 7105. Sincerely, Sarah Johnson Millon Business Manager

How- Cost Benefit Analysis XXX School - Satellite Program Proposal District xx. x Meals ANNUAL Daily - MEALS REVENUES - SALES 75, 000 $ 168, 750. 00 REVENUE $ $ 168, 750. 00 170 $ 22. 20 170 $ 15. 83 170 $ 16. 37 170 $ 12. 26 170 $ 10. 82 SALARY $ $ $ 3, 774. 00 6, 727. 75 6, 957. 25 10, 421. 00 9, 197. 00 37, 077. 00 IMRF FICA/MEDO BENEFITS FOOD $ $ 4, 376. 43 2, 836. 39 9, 400. 00 92, 812. 50 EXPENSES $ 146, 502. 32 $ 22, 247. 68 441. 176471 ADDITIONAL EXPENDITURES - SALARY 1 2. 5 5 5 $ 2. 25 NET GAIN / LOSS NOTE Separate production records Separate commodity use Pick up of meals Drop off pans Same menu 54%

Shared Services-How SAMPLE - INTERGOVERNMENTAL SHARED SERVICE AGREEMENT THIS AGREEMENT is entered into this ___ day of _______, 2012, by and between the VILLAGE OF HILLSIDE, a unit of local government (hereinafter referred to as the “Village”), and HILLSIDE SCHOOL DISTRICT 93, a school district (hereinafter referred to as the “District”) (collectively, the Village and the District hereinafter referred to as the “Parties”). WITNESSETH: WHEREAS, Article VII, Section 10 of the Illinois Constitution of 1970 authorizes units of local government and school districts to contract to exercise, combine or transfer any power or function not prohibited to them by law or ordinance; WHEREAS, the Intergovernmental Cooperation Act (5 ILCS 220/1 et seq. ) authorizes public agencies, including units of local government and school districts, to exercise jointly any power, privilege or authority which may be exercised by a public agency individually, and to enter into contracts for the performance of governmental services, activities and undertakings; WHEREAS, the Village currently purchases fuel from Avalon Petroleum Company (the “Wholesaler”) for use by the Village and its employees while operating equipment and motor vehicles owned by the Village and used in the performance of the duties and responsibilities of the Village; WHEREAS, the District currently owns and operates equipment and motor vehicles which are used by the District and its employees for the performance of the duties and responsibilities of the District;

Association of School Business Officials - Illinois 2013 Annual Conference Questions and Answers

Thank you! -Mel Diaz: Area Senior Vice President, Gallagher Benefit Services, Mel_Diaz@ajg. com -Sarah Johnson-Millon: Business Manager, Hillside 93, SMillon@hillside 93. org -Eric Miller: Assistant Superintendent, Skokie 69, millere@skokie 69. net