Tax Cap Worries

Posted on 30 March 2012

The Sag Harbor School District has accomplished an impressive feat. With a lot of careful tweaking, the district has come up with a budget that falls just below the two percent tax cap. It’s a feat that most likely would have required much more gruesome slicing and dicing in prior years.

Last year alone, the school board presented a budget that projected a 6 percent increase to the tax levy, and a year before that the projected tax-levy increase hovered around a whopping 10 percent—which, at that point, was the highest tax rate increase the district had experienced in 10 years.

But times have changed. This two percent tax cap is here to stay. This year, the district has not only had its sights set on keeping its budget under control, it has taken a magnifying class to current expenditures.

The business department took crucial steps to streamline its costs — from refinancing the 2002 Bond Issue ($22,524) to paying off Teachers’ Retirement System Incentives early ($132,240) — garnering a total savings of nearly $400,000. And the Special Education Department, which has worked hard over the years to facilitate special needs students’ transitions into regular classes, this year showed savings of almost $500,000.

In total, the district claims it has taken measures that have resulted in exactly $935,413 of cost savings.

Furthermore, the district has shown significant efforts to think outside-the-box to save even more on costs. While the district proposes spending nearly $570,000 of tax-payer money to buy six new buses this year, that money would be accounted for via cost savings by the 2017-2018 school year. Overall, the business office projects this maneuver would generate upwards of $170,000 in savings over the next seven years.

Our hats are off to you, Sag Harbor School District.

However, we can’t help but worry about what this budget process will look like down the road. And not just in the distant future, we worry about where we’ll be exactly this time next year.

Getting through the first year of a mandatory tax cap is admirable. But getting through it in year two, three, four and beyond — well, that’s going to take some doing.

So while the district has taken several cost-cutting measures that have helped with the budgeting process this year, these won’t necessarily generate additional savings each consecutive year. In fact, while special education has seen a dramatic decrease in costs this year, this number can just as easily increase in coming years—and this is not something the district can necessarily plan for.

At this week’s school board meeting, board members Walter Wilcoxen and Ed Drohan spoke to a need for developing a long-term plan for the district. And we support this idea in full.

The two-percent tax-levy cap will be here again next year, and the year after that, and the year after that… for at least four more years until the state will finally have the chance to reassess the legislation. Who knows what will happen then? But in the meantime our school district is looking at a cap, all the while costs of benefits are expected to increase each year by more than that.

At some point, the tax cap is not going to allow us to keep up with those expenses — the next round of contract negotiations could be an issue. This means cutting costs. This can mean cutting programs, or staff members, or teachers, or — you knew we were getting to this — cutting benefits.

It was mentioned on Monday and we’re going to say it again: we highly encourage the Sag Harbor School District to enter into contract negotiations with the teachers’ union early. And we urge the teachers’ union to consider negotiating down.

The cost of personnel is high and continuing to climb. Let’s try to curb these growing costs before we have to make serious cuts to our children’s educational programs.

And let’s not wait until next year to do it.

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