In a 5-2 vote this past week, the Ann Arbor Board of Education approved a $183 million 2011-12 budget. School board President Deb Mexicotte joined us on 1290 WLBY right before the vote to discuss the funding struggle Ann Arbor and other districts are facing.

Lucy Ann: You have nearly a decade of service on the Ann Arbor Board of Education. Is this (budget process) the worst you’ve ever seen it?

Mexicotte: We’ve never had to cut this amount in such a short period of time. We have a structural deficit in funding education in Michigan, so we are every year looking at between six and seven million dollars to cut just because of that structural deficit. But last year with some changes in the way that we were funded, we ended up looking at a $20 million deficit and this year we’re looking at $15 million.

Deb Mexicotte talks about the school budget, the new superintendent's pay and what she would say to Gov. Rick Snyder.

Mexicotte: What it means is that it’s built in, that there isn’t a good way to not cut every year. We have certain costs that are rising every year such as retirement, in some cases health care - we’ve actually capped our health care so we’re able to control that a little bit - but salaries, utilities, all these things go up and yet state funding has not been able to keep pace based on the formula used under Proposal A in order to fund education. It’s as if every year your costs go up 5 percent, but your revenue only goes up 1 percent. That difference is that structural deficit.

Lucy Ann: If you were an adviser to Gov. Rick Snyder and could tell him what you think would work for these school districts, what’s the answer?

Mexicotte: Well, the first answer would be without investing in education for all students, we will not have the educated workforce, we will not have the businesses that we are trying to attract to move into our area, and we will not have the quality of life that we expect for our citizens.

Lucy Ann: How do you do that in an economical way? There’s only this pool of dollars to use.

Mexicotte: I believe that the governor needs to look at revenue generation. You know, no one wants to say the tax word, but we tax ourselves for those things that we value and we value education for all of our students. Not looking at the revenue side and thinking you can cut and cut and cut your way to prosperity is just not what history has told us. We pay for what we value, we are willing to do that. Look at the last special education millage that just passed; it passed in some places at 90 percent, and why? Because people said, “You know what, I had no idea how strapped our schools were going to be around this issue and we are willing to pay for what is going to be good for our students.” So, I would say to Gov. Snyder, “This is an investment that we know we need to make. It is the primary engine of economic security and a high quality of life and we deserve to be given the opportunity to pay for it.”

Lucy Ann: The Ann Arbor Public Schools recently launched an agreement with a local business to license and sell wearables, which I think is a really interesting concept. Is there something that we can do on a business side to generate revenue as opposed to taxing our residents?

Mexicotte: Well, I think that we have been exploring a lot of those possibilities and certainly the licensing agreement is one of them. For years, we allowed the use of our school names and the like on all kinds of apparel and hadn’t even really thought about the fact that a small licensing fee would not harm businesses and actually help the schools.

Lucy Ann: Anyone could put a Huron River Rat on a T-shirt and sell it over at Meijer. That has stopped now because you have this new licensing agreement.

Mexicotte: Some of the big box stores were making a large profit. If our brand in Ann Arbor means something because of our fine education and the fine quality of life here, then that’s something that people can give back to the community a little bit for. … We certainly are looking at any area that we might be able to use while keeping true to our core mission, which is the education of students. We also have a new superintendent coming in July 1, Dr. Patricia Green, and we know that that always brings new energy, new ideas, new ways of looking at things, and I think that we’re all really looking forward to that as well.

Lucy Ann: I want to ask you about her salary. That was a point of consternation among some taxpayers considering the hard times that you’ve outlined here. How much is she going to be making?

Mexicotte: Her salary package is approximately $245,000 in terms of actual salary.

Lucy Ann: The district spent around $30,000 for the search.

Mexicotte: That’s right. (It was) a national search. We were very pleased with the candidates that were brought forward.

Lucy Ann: Explain why her salary and the cost for the search are worth it.

Mexicotte: We were looking for an experienced superintendent, somebody who could really lead us in these very, very difficult economic times, in these difficult educational times, and who had the experience of working with districts already that didn’t have to grow into the position but understood what it meant to be a superintendent. The board looked at what kind of salary would we need to put forward in order to get that kind of experienced superintendent and that is, indeed, the superintendent that we have hired. She has nine years of experience in her previous district as a superintendent, she’s been a deputy superintendent before that, and she has a long record of being able to turn around areas in student achievement, in special education, in budgeting, in negotiations. She is the whole package in terms of what we were looking for. We also knew, perhaps, that it would be a struggle to get those great candidates to come to Michigan where we have been struggling a bit economically. We knew these challenges would be great so we needed someone who was visionary and knew that they would be up for the challenge. The last thing … we wanted someone who was going to make a long-term commitment to the district understanding that their salary was probably not going to move during the time that they were here.

Lucy Ann: No one should be expecting that $250,000 to go up.

Mexicotte: That is correct. No one is expecting that.

Lucy Ann: And I guess time will tell whether it was worth it.

Mexicotte: And I think that’s always the case in a hiring process. You know, you do the best you can, you bring the community together, you bring the board together, you bring the administrators together, and we think we have made an excellent choice for the school district. But, as you say, time will tell. I think that in two years, if she is the visionary leader that we’re hoping that she’ll be, I don’t think that her salary will be an issue any longer.

Lucy Ann Lance and Dean Erskine own Lance & Erskine Communications, which produces “The Lucy Ann Lance Business Insider” (M-F, 8 a.m.-11 a.m.) and “The Lucy Ann Lance Show” (Saturdays, 9 a.m.-12 p.m.) on 1290 WLBY. The programs are live streamed at www.1290WLBY.com, and podcast on www.lucyannlance.com. The above interview is a condensed version of a longer conversation that is edited for clarity. The complete audio interview is posted online at www.lucyannlance.com.