What would you cut from a school that aims to increase its budget based only on non-discretionary spending like that tied to the cost of health care or retirement?
That is exactly what the Bridgehampton School hopes to learn on Wednesday, February 8 when it hosts a forum on its 2012-2013 budget.
The school board is hosting the meeting in an effort to understand what the community hopes for the district as its wrestles with a state imposed two percent tax cap. On top of that, rising healthcare costs, new unfunded state mandates for teacher training and non-discretionary expenses are all increasing just as the district is being told it must cut back.
During a Bridgehampton School Board of Education meeting on Wednesday, January 25, the district’s superintendent Dr. Lois Favre and its business administrator Bob Hauser presented the board with a financial forecast for 2012-2013.
“There is no denying we are over-dependent on property taxes,” acknowledged Dr. Favre, adding communities throughout New York are struggling to deal with the reality while still funding necessary services.
Dr. Favre noted that the two percent property tax levy cap is misleading in that many voters will assume the cap limits districts to a total two percent in spending increases. In fact it is a cap on the property tax levy, or the amount of money the district is allowed to raise through taxes.
Existing capital projects and retirement systems, both which raise the Bridgehampton School budget annually, do not count, noted Dr. Favre. She added that while the state is trying to get school districts to force concessions with their teacher unions, those negotiations will likely not be determined as the school district presents its 2012-2013 budget. While the state is also recommending districts cut their fund balances — the amount of money left in reserve after expenses are accounted for each budget year — she believes that having a fund balance is critical, especially during tight fiscal years.
“We have seen little from the state in the way of mandate relief,” said Dr. Favre, noting that required teacher training and assessment requirements have increased while the state is also asking school to keep budgets tight.
The state is requiring schools to expend administrative time in a range of areas, such as new teacher evaluation methods, new teacher training in core standards and lesson development, new training on student learning objectives and the development and refinement of data teams, meant to evaluate the whole of the school’s effectiveness.
“Staff development costs are not being considered,” said Dr. Favre of the tax cap.
For Bridgehampton School, a two percent property tax levy cap translates to a 2012-2013 budget that cannot exceed 4.12 percent in increases. Dr. Favre stressed she feels many residents do not understand a two percent tax levy cap does not mean a two percent cap on increased expenses. She added that it will be critical for the school board to educate the community explaining that if they do seek a 4.12 percent increase, they are still within the two-percent tax cap.
Retirement costs and capital projects are not included in the tax cap, said Dr. Favre, but many residents may not understand that fact.
“If we don’t get the word out to the public they will get very frustrated and come running here to vote us down when that is our two-percent tax cap,” she said.
“The district must be mindful,” said Dr. Favre, “that they no longer have the ability to revert to a contingency budget if their budget is voted down. Contingency budgets often gave school districts funding to cover its basic expenses without having to drastically cut down programming or staff.”
If the budget fails to gain the approval of voters twice, said Dr. Favre, the district must revert to a zero-percent increase, meaning the amount of programming lost would increase significantly.
Dr. Favre said she wants the school district community to engage in a discussion about different budget scenarios before a draft budget is formalized, hence next Wednesday night’s meeting.
The reality, said Dr. Favre, is with zero increases school districts on Long Island are looking at an increase in budget cuts from 4.9 percent to over 12 percent over the next five years. At the same time, health care costs are increasing at what Dr. Favre called an “alarming rate.”
“This is not something that is sustainable,” said Dr. Favre, who added that depleting the district’s fund balance to offset the budget or not adding to it will only increase the district’s financial woes over time.
If the district simply rolls over its budget from 2011-2012, with no increases outside of contractual expenses and state mandates, the Bridgehampton School budget for 2012-2013 would be $11,333,042, a $756,328 increase or 7.15 percent over last year, well beyond the tax cap.
The budget advisory committee has looked at $195,237 in savings found in staffing changes and contractual changes with staff that have yet to be realized. They have also explored changes in staff and transportation that could increase that savings, although no figures had yet to be tabulated, said Dr. Favre.
Required in the 2012-2013 budget is a $135,000 debt payment on the 10-year voter approved window project, technology updates needed to keep the district within its five year plan with BOCES, expenses related to a five year safety and building plan at the school. Also in the budget is mandated staff development by the state, necessary upgrades to the music department and the tuition for up to three students to attend the Child Development Center of the Hamptons, which is required by law.
“I think for the past few years this board has done an excellent job of presenting a budget to the community they could support,” said Dr. Favre, adding the budget has been pared down each year.
Staying at the same level as last year, with the budget advisory committee’s suggestions, the district would need an increase of $561,000, but under the tax cap can only ask for $379,000 without any additions to the fund balance, said Dr. Favre, leaving the district in a worrisome position for next year and still facing a deficit.
The alternative is to ask voters for more, but the school must earn a 60 percent vote or more in favor of its budget if it hopes to pierce the tax cap.
“What are we willing to give up,” asked Dr. Favre, noting that the need to cut hundreds of thousands from a budget of Bridgehampton’s size does not amount to cutting down on supplies.
“There are not enough paper clips in the budget to reach these figures and trust me when I say we have already cut our supplies for this budget,” she said.
Instead, what is at risk, is programming like the summer school options at Bridgehampton, which have been very popular, as well as stipends to allow student clubs to run at the school. The pre-kindergarten program could also be at risk, as well as student leadership prizes, clerical support, teacher aides, custodial staff time, field trips, technology, staff and even teachers.
“We are in good company across the state,” said Dr. Favre. “This is not just a Bridgehampton problem, it is all over the state, and some are in a worse position than we are. This is a year we probably need to hear from our stakeholders.”
The community budget meeting will take place on Wednesday, February 8 at 7 p.m. at the Bridgehampton School.