Victor Hayek referred to the last few months as an endless game of yo-yo.

Now the North Caldwell Public School District's business administrator is just waiting for the spinning to stop.

Already faced with an approximate $750,000 deficit as a result of increased costs for benefits, utilities and projected salaries, the K-6 district lost all $246,659 in state aid as well.

As a result, the Board of Education plans to introduce a budget of $10,893,008 with a 4 percent tax levy Wednesday night that will potentially eliminate 21 of the district's 99 full-time positions—more than 20 percent—in addition to reducing several other teaching positions to less than full-time status, Hayek said Monday.

"We were originally told to plan for a 15 percent reduction in state aid and we built the budget on that 15 percent reduction," Hayek said. "It was kind of a yo-yo game. We started in a deficit—it's like that most years—and then we were told one thing and we built the budget based on that.

"It's been a three-month process of budget, cuts, new budget, more cuts, new budget and more cuts. It's brought us to this point here. It's an unfortunate situation all the way around, because it involves so many cuts in personnel."

According to Hayek, the proposed reductions span the entire district—including teachers, secretaries, custodians and support staff—but he could not provide specific areas since official notification won't be given by Superintendent Linda Freda until after Wednesday night's public hearing at Grandview School at 7:30 p.m.

"This is what the board is proposing," Hayek said. "Our budget hearing is Wednesday. The board has the flexibility and ability to change the budget. The point of the budget hearing is to listen to what the public has to say, if they want to make any changes and the board can make any changes before they adopt a final budget."

The district has already altered its budget several times.

 The Board of Education overcame a projected $750,000 deficit by deciding earlier this month to eliminate 14 full-time positions following this school year.

"We reduced that initial deficit by making some personnel cuts and reducing planned purchases for next year," Hayek said. "The bulk of it came from the elimination of full-time positions. We covered that gap initially with the board. We went line-by-line and made some other miscellaneous spending adjustments here and there with reductions through the budget."

However, the district was then informed two weeks ago that all of its state aid will be eliminated for 2010-11. Following an emergency meeting, the board elected to cut another full-time position—bringing the total to 15—plus reducing several teachers to less than full-time status, Hayek said.

"Teachers are measured on full-time equivalency, meaning 1.0 is full time," he said. "So we reduced some of the teachers' assignments to 0.8 and 0.6. That was a way for us to keep the programs, but save money at the same time."

But the district's proposed budget was rejected by the county superintendent because it exceeded the 4 percent tax levy cap, Hayek said.

The budget was then reduced by another $414,000 last week with the elimination of four more teaching positions as well as two other full-time positions, Hayek said.

This preserved a 4 percent tax hike that will cost a homeowner an estimated $192 increase for an average assessed home in 2010 of $736,800, according to Hayek.

The district also remains in negotiations for projected 2010-11 salaries with the teachers and support staff unions, according to Hayek, who said all programs appear to be saved.

"We're restructuring some programs that we're going to do and just the way that we deliver them," he said. "But we haven't eliminated any programs."

The district has also conservatively projected $100,000—about half of the $209,399 it was provided this year—in extraordinary aid for 2010-11 as a precautionary measure, Hayek said.

"In talking with the county superintendent, we figured we would budget half of what we would anticipate just to be safe. If we end up getting more, then it gives us flexibility to undo any changes that we did in the proposed budget," he said.

"What we went through is no different than any other district. The strength of this district is since we got such little state aid—the lowest per pupil in Essex County—it didn't hit us as deeply as it would have if we had gotten more state aid."