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Appendix D
Revenue and Cost Reduction Initiatives
I. Cost Reduction Opportunities
Tier I Suggestions:
a) Encourage schools and public libraries to jointly plan and utilize local telecommunication facilities. Possible savings are $20 million.
b) Encourage the use of Community Colleges, Vocational Schools and the State University system to develop a program whereby technical students can provide support to K-12 schools for the installation and maintenance of the technology system. Possible savings are $5000 per year per school, for a five year total of $57 million.
c) Develop a program whereby teachers, students, librarians and administrators can pay a portion of the purchase price of the computers, and own the computers after a predefined period of using the equipment on behalf of the schools or libraries. If the split were to be 50-50 for lap top computers only, the savings would amount to approximately $40 million.
d) In the context of a NJ Board of Public Utilities proceeding, seek approval of preferential rates and/or discounted tariff rates with all telecommunication providers for services offered to schools and libraries. Plan assumes a 15% reduction in overall tariff network charges.
e) Develop measurable standards of progress with regard to implementation of the District Technology plan, and adjust allocated State funding in accordance with the annual results obtained. Also tie funding to the District's adherence to the NJ State DOE technology plans, and facilities standards for technology. Potential savings could be $50,000 per district on average or about $30 million.
f) Initiate a technology equipment repair program at various vocational schools throughout the State, and negotiate repair rates. This will reduce costs and provide student training in a growth industry. Possible savings are $17 million.
g) Develop "technology planning partnerships" between school districts with proven, acceptable technology programs and state operated school districts and special needs districts; provide an incentive for the more advanced district to lend its personnel to provide the necessary support. Possible savings would be about $3 million.
h) Each school district may conduct financial analysis of software purchasing versus district licensing. Savings are about $10 million.
i) Limit the referenced technologies provided to Kindergarten students. This reduces the five year capital expenditure by approximately $75 million.
j) Initiate a program of State level purchasing of all technology equipment for use in school or at home; at a minimum support the concept of combined local district equipment purchases. A 15% reduction in cost is anticipated and included in the funding/cost plan.
k) All district technology plans will have a funding section that details first costs, and suggests the method(s) to be used to assure long term self sustaining funding. The formal planning process will reduce costs 1% on average or about $20 million.
l) Actively encourage the use of leasing and lease-purchase options in lieu of product purchase. A life cycle reduction of 2% or about $40 million is anticipated.
m) Establish a school technology loan program in which NJ would define the eligibility requirements for borrowing from the loan pool and set the borrowing terms. A saving of about $10 million is possible.
n) Provide an incentive tax credit for business investment in NJ schools. Donations are included in the plan.
o) Use a mix of long term bonds and serial bonds to better relate the pay back period to the life of the asset(s). A $20 million saving may be possible.
p) Develop a District technology foundation that would accumulate and invest funding from multiple sources; the foundation would then allocate funds to the schools within the District in the most efficient manner. Increased efficiency in use of funds should reduce costs by $20 million.
q) Out source non-instructional services and reallocate sold assets and annual savings to instructional services. A saving of $25,000 per district per year, or $75 million may be possible.
r) Encourage the use of local residents as volunteers in all areas related to technology based systems. Assume a saving of 50 hours per year per school. At $40 per hour this equates to $23 million.
s) Match the technology to the task. If each school were to reduce its purchase of products by $400 per year, the savings over 5 years amounts to $5 million.
Tier II Suggestions:
a) Incent and reward school districts and libraries that reallocate existing funds to support the technology programs. Reallocation of $10,000 per school amounts to $11 million.
b) Suggest an upgrade in power, communications and environmental infrastructure design criteria for new construction to eliminate the need for future renovations. If 100 schools in the state prepare for future infrastructure additions, the savings could be $25,000 per school or $2.5 million
c) Suggest that all architectural firms that design schools and libraries within the State demonstrate knowledge of designing facilities for the use of technology. Savings could amount to $2.5 million by eliminating the need for future renovations to adapt to the needs of technology.
d) Create awareness of the need to plan new facilities (schools and libraries) to accommodate emerging information technologies. The savings are a component of those identified immediately above in paragraph c.
e) Offer a local tax break to community residents who donate usable (and appropriate) computers to their local school or library. The Plan assumes local donations.
f) Make every effort to take advantage of all forth coming Netdays by maximizing the use of volunteers. Wiring savings would be about $1,500 per school or $3.5 million.
g) Attempt to expand partnership relationships with NJ companies by soliciting their on going support of the state's schools and libraries.
h) Investigate the possibility of allowing school districts to place unused annual allocations of technology funds into an interest bearing account to be spent within a set additional time period on technology programs. New revenue (savings) could average 2% of average available funds or about $8 million.
i) Seek to combine district level installation, maintenance and support operations of the technology system under one contract. Savings could be $20 million.
j) Evaluate the potential savings associated with the use of computer simulations to reduce the cost of purchasing and safe guarding science equipment and associated support materials (e.g. chemicals). Assuming a saving of $2000 per school amounts to $4.5 million.
k) Look to local districts and libraries to coordinate the orderly retirement of obsolete equipment. The sale of aging equipment is assumed in this plan.
l) By coordinating the efforts of school and library technology coordinators attempt to develop and distribute procedures for the adoption of common software, e-mail and other applications, where deemed appropriate. Use of common platforms should save about $5 million.
(Total potential savings over 5 years = $522 million)
II. Revenue Initiatives for Consideration
Tier I Suggestions:
a) Seek voter approval of state bond issues dedicated to supporting technology programs throughout the state's schools and libraries.
b) Continue to leverage access to federal funding programs.
c) Make every effort to designate a technology funding component of the State lottery to be used for education and library technology enhancement
d) Encourage communities to obtain support for technology systems in schools and libraries from CATV companies or phone carriers as part of franchise or franchise renewal negotiations.
e) Suggest a sales tax on video rentals; the money to be used for distance learning programming
Tier II Suggestions:
f) Create awareness of the value of the NJ Education Network outside of New Jersey, and initiate a marketing program to develop this network as a revenue source
g) Offer NJ business the opportunity to partner with NJEN
h) Investigate the potential of offering access to technology room(s) after hours to civic organizations
i) Consider suggesting voluntary fees for the use of select technology products in public libraries.