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Cummins exec helping Franklin schools cut expenses

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Andrew Lamm is going through the city of Franklins finances to see what money he can help them save. Lamm photographed in his Indianapolis office Wednesday, Feb. 27, 2013. Scott Roberson / Daily Journal
Andrew Lamm is going through the city of Franklins finances to see what money he can help them save. Lamm photographed in his Indianapolis office Wednesday, Feb. 27, 2013. Scott Roberson / Daily Journal

Leaders of Franklin schools hope a business trend can help them cut spending as they face a multimillion-dollar shortfall for years to come.

Between now and the end of the summer, Andy Lamm, director of information asset protection for Cummins Inc., will review Franklin’s budget to see what cuts the school district could make. Lamm was trained as a Six Sigma black belt in 2002 and spent two years reviewing projects at Cummins to see how they could be done more efficiently and training co-workers to do the same.

Six Sigma black belts are trained to find ways to make projects run more efficiently and how to identify anything that could slow a project. Franklin officials are hopeful that Lamm’s training will help him find ways to reduce spending of tax money the school district gets from the state.

Some expenses can’t be cut, such as the amount of money paid to insure school buildings. And while Franklin might have to consider laying off employees, those cuts typically affect how well students learn, an effect the school district wants to avoid, executive director of finance Jeff Mercer has said.

That’s why Lamm will start by reviewing expenses such as utility costs and how much the school district pays for equipment such as copy machines and computers each year. By analyzing how much power Franklin uses, during which time of day and for what, as well as how often the school district upgrades technology, Lamm may be able to cut the school district’s spending.

“When we dig into those items that are under (Franklin’s) control, those are the items we’ll go after to see what changes we can make,” Lamm said.

Franklin school officials have to find a way to cut spending before the end of the year, because property tax caps are limiting the amount of money the school district collects for annual debt payments, building repairs and replacement buses. The school board already is considering how to refinance money borrowed in 2004 to pay for the high school. But restructuring those payments won’t be enough to offset the average $2.5 million shortfall for debt payments that Mercer expects every year for the next 10 years.

Last year, Mercer, Franklin Superintendent David Clendening and several other Franklin employees started receiving

Six Sigma training. But that instruction was broad and intended to be used in situations such as deciding whether or not to expand course offerings. Lamm has more experience using Six Sigma, as well as a fresh perspective because he’s not influenced by Franklin’s previous spending habits, Mercer said.

Lamm lives in Franklin and has two boys attending Franklin schools, and he started speaking with Mercer and Clendening a few months ago about the spending cuts they had to make. Lamm then volunteered to work for free to find ways for the school district to reduce its spending.

Cummins employees are encouraged to regularly volunteer in their communities; and while Lamm may need to use some of his spare time to review Franklin’s budget, he’ll also have a flexible amount of time during the day to work, Cummins spokesman Jon Mills said.

“The margin for error here is pretty thin, and having someone like Andy help you think through those opportunities is a great resource for us to have,” Mercer said.

To review utilities, Lamm wants to review what Franklin pays to power every square foot of every building it owns. He also wants to see how those rates compare during the day, when class is in session and at night, when clubs, sports teams and other groups may be using the buildings.

Once Lamm knows how much energy Franklin uses and when it’s used, he may be able to find ways to cut costs. For example, if lights are being left on in rooms that nobody is using, then automatic timers could help ensure the lights stay off when officials know the rooms will be empty. The school district also could consider new policies to ensure clubs and groups using the buildings are turning the lights off once they leave, Lamm said.

Equipment purchases are another example of where cuts can be made, Lamm said. He wants to see how often Franklin purchases copy machines as well as technology for computer labs, and how much it pays for those items. Then he’ll review whether it would be cheaper for the school district to lease those items instead, he said.

Most of the money in the fund Lamm will review pays for employees’ salaries and benefits, and while neither he nor Mercer thinks personnel cuts will be needed, he’ll have to consider every option. Franklin already has decided to eliminate one principal position next year by having one principal overseeing both Webb and Union elementary schools.

Lamm’s budget recommendations likely will be complete this summer. Franklin must decide whether any of those recommendations will be implemented as well as how it will refinance its debt payments by December, when it will no longer have enough in its savings to repay what’s owed.

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