Direction Sought as School Budget Planning Begins Now for February Presentation
The Oyster Bay-East Norwich Board of Education meeting on Tuesday, Nov. 16 was interesting and worth attending for the scope of the budget discussion. It was early in the year to discuss the budget, but with the economy more and more affecting school districts it was a lesson in how the numbers are piling up on top of educational costs. There is a fallout from the economy itself, having nothing to do with the schools themselves – which is going to add to the tax burden.
When Nassau County decided to push its certiorari refunds and the new sewer usage fees onto the schools it was joining the parade. The MTA had already signed on to get money from the schools; and the stock market that has sucked the NYS pension fund revenue stream up must be filled by the school taxes.
Trustee Keith Kowalsky put the issue in plain words when he said the school budget is the only one taxpayers vote on. What will be the outcome of that?
Interestingly this was the first OBEN board meeting to be available in live time on the schools Internet site, obenschools.org
Budget 101
Superintendent of Schools Dr. Phyllis Harrington showed a Power Point presentation of what the district is facing budget-wise. It’s unusual to discuss a budget so early in the year – it is usually a February discussion she said – but this year it is more daunting and a strategy has to be set to determine where and how the budget will be tweaked to fill the gap. She listed the cuts from previous years saying the flesh was gone and they were down to the bone.
She listed the prior year’s cost savings which included: refinancing existing debt; energy efficient upgrades; participation in cooperative bidding; reduced transportation contracts; settled labor contracts at a historic lows and increased employee benefits contributions.
When trustee Donald Zoeller reported on attending the NYS School Board Association meeting held in New York City he said, during lunch, a man came over and introduced himself and commented on the OB-EN board saying, “Congratulations on the great job working out the teacher’s contract.”
Dr. Harrington continued, giving the program highlights in terms of what was happening during the school day as well as those outside activities that add to the programs. It was to give the board a sense of where they are today, she explained. That brought her to the 2011-2012 budget challenges.
Projected Expenses
Her projection of what the district has to face includes:
• Significant increases to the NYS pension system of $985,000 as a result of the poor performance of the stock market.
• Significant increases in health insurance which adds $480,000 to the budget.
• The elimination of American Recovery and Reinvestment Act of 2009, that funded positions by $175,000. That funding is over and the district has to decide if they want to take on those costs.
• The new Nassau County sewer usage fee which is projected at $47,000 but which is not set as yet since there are no current guidelines for the fee.
• Next is the issue of how to address the tax certiorari refunds that Nassau County will pass on to the school districts. Assistant Superintendent for Finance & Operations Christopher Van Cott said, “The frustrating thing about it is that districts have not been provided with the financial impact of the refunds. The county has been asked to provide historical data which they have not. A colleague calculated the potential liability based on each district’s property values; which for Oyster Bay resulted in approximately $1 million in refunds. This is only an estimate, we’ll need to get real numbers from the county.” The question is – should the district begin saving for that cost, which will be shifted to the schools in 2013. Currently, County Executive Ed Mangano and Minority Leader Diane Yatauro reached a bi-partisan agreement with respect to handling the review and funding of tax refunds. This agreement includes the authorization of $50 million to be used as necessary in 2010 and 2011.
• The next consideration is what the contingency cap will be in case of a defeated budget. The school board has to consider what figure to go for in setting the budget. As the figures now stand, Dr. Harrington said it means approximately a 7 percent increase which she cautioned was not the actual figure, that a great deal of work needs to be done on the decision.
There was a suggestion that it could be a 2 percent cap which means if the budget is defeated twice, the district would adopt a contingency budget limited to a 2 percent increase.
Setting a Viewpoint
The discussion was to set a strategy on how to work with the budget when Dr. Harrington presents it to the public. She said she “struggles with the annual challenge of balancing the needs of the students with the needs of the taxpayers.”
She said that with a Rollover Budget with the current level of programming and staffing, the zero percent teacher contract settlement; elimination of the ARRA funded positions; the uncertainty of other grant funds; modest increases in BOCES services and contractual services; the majority of summer special education program costs absorbed by local districts; significant increases in pension and health insurance costs; the MTA Tax and the new Sewer Usage fee, the district would need to raise $3.3 million more than the current year’s budget to meet the other budget items. Not included was the tax certiorari refunds which was estimated to be $1 million, but Dr. Harrington asked, “Can you fund a reserve fund with no numbers? The jury is still out,” she answered herself.
Next Dr. Harrington considered some other “calculated risks”: that $350,000 will come in as grants; Special Education will come in at the same level as this year; and they can reduce that line item by $100,000. The risks would mean taking $520,000 out of the roll over budget figure.
She stated, “Given the reductions that have already been made, and the challenges we face, in order to reduce the budget further the following significant reductions would have to be seriously considered: reduce a total of 10 teachers resulting in $866,000 in savings including salary and benefits; one less administrator saving $158,000; the elimination of MS and JV athletics to save $300,000; and the elimination of co-curricular activities for a savings of $125,000. That would mean a reduction of approximately $1.4 million.”
Dr. Harrington said she was beginning the budget discussion earlier so people could talk to the residents and added, “Look at the list of cuts; there is no other place to tweak. We cut back the flesh and now we are at the bone.” She said the cuts are harder to make in a small district. A larger district has more options in sharing staff.
The district has however, been making dramatic cuts over the past three, four or five years she said, so they are a step ahead of others just addressing the needed cuts to keep taxes down.
Board Comments
The board then used the information to weigh which way to go. “It’s a very ugly situation,” said Board of Education president James Robinson. The county has shifted the blame onto the school district and the taxpayers will have to pay for it. Budgets will go through the roof, he complained.
“And only the school budgets get voted on. It’s a horrible problem. Terrible,” added trustee Keith Kowalsky.
Trustee Donald Zoeller suggested, “Please tell your friends to come to school board meetings so they can understand the problems.”
“It is not going to be a 7 percent budget increase,” said Dr. Harrington, to make people aware that it was just the initial information she was presenting. “I’m shocked by the figure,” Robin Dando commented.
James Matell made a stand: “The last place to look at is cutting teachers. That only takes away from the work we have been doing. Anything goes before that, we are educators. Our priority is education.”
Considering the history of voting in the district, Dr. Harrington said, “Even in the best economic times we have had a significant number of ‘no’ votes. In our last annual vote with a 2.9 percent increase there were more ‘no’ votes than the year before.”
Dr. Harrington said she would be fine-tuning the budget line by line looking for cuts to lower the projected percentage increase.
Robin Dando suggested the district had to look at things differently: if they were cutting out help for students at risk the teachers would have to be available an hour more after class to help them in small groups. Teachers will have to bring the lower performing students up to grade, was her comment.
Ann Marie Longo suggested to increase the size of classes at the elementary school while staying on the low class size level.
Community Comments
A question was asked about the renovations to the Memorial Stadium. Local resident Caroline DuBois had asked if the facility would include girls bathrooms – that were not indicated on the preliminary drawings. Assistant Superintendent for Finance & Operations Christopher Van Cott said he met with the architects and the building will be designed with two areas – so that in the future they can have boys and girls using the building – with a bathroom designated for female athletes.
Parent Louis Cohen said people are moving here for the great education provided and see value in the district. He said he and 15 of his friends are willing to pay what it costs to keep the education at the level it has achieved. “That’s why we moved here. It’s a whole new district,” he said.
Kathleen Basta said the district needs a marketing plan to help pass the budget.
Margaret Haus was concerned that her seventh grade son would not have what he needs for eighth grade. She was concerned with his college application and didn’t want to have to move to help him and said, “The colleges want well-rounded kids.”
That was when applause broke out from the audience of about 35 people.
Ms. Haus said she attended Catholic school but likes the openness of the public school. “I’m willing to pay more (in taxes) we have to tell the parents. We have to get the message out,” she said.
Mr. Robinson said the budget had not been set as yet; and said he didn’t want to cut staff. He said the district is where it is now because that is what the public said it wanted.
Lisa Iametti Heriot, with children in the seventh, fifth and first grade, said she was attracted to the district. But she added that she was saddened that her first grader was missing some of the benefits, such as trips her seventh grader had experienced, as a result of budget cuts. She said, “We are a very responsive community. We will help to get the information out.”
Mr. Kowalsky said, “We will provide the best education at the best price we can.”
Mr. Castellano added they would spend money more efficiently.
Trustee Zoeller commented that, “There is a percentage of people who have no children and won’t have children. Maybe there is nothing we can do realistically.”
Ms. Dando said that what is driving the budget is the state of the economy including the district having to pay $1million for pensions. She said on a personal note: “I don’t want to pay a dime for anyone’s pension. I have to work until I die.” Still, paying for others pensions is what the district must do.
Some Hope
In the midst of this, the district has a possible new revenue source which could reduce the budget somewhat. The Iroquois natural gas pipeline in the Long Island Sound uses adjacent underwater areas along the north shore, said Dr. Harrington. “We contend that the pipeline should be on the assessment rolls for Glen Cove, Port Washington, Great Neck, Oyster Bay and Cold Spring Harbor.”
Dr. Harrington said the tax benefit for Oyster Bay was originally considered to be in the 45 to 46 percent range. An underwater geophysical survey was conducted by an underwater diver and the lines were re-drawn and now Oyster Bay would get approximately 16 percent ownership – resulting in assessment tax money. Still there are things to discuss.
The law firm of Frazer & Feldman is working with the other districts’ law firms in representing all the districts to determine how to proceed. Nassau County wants the school districts to be accountable for a challenge of liability and attorney’s fees if the Iroquois Pipeline company takes the case to court. The board will have to decide what to do.
Mr. Van Cott said the Iroquois pipeline is a utility. By adding the pipeline to the tax rolls, it would increase the assessed value of Class III which is for special utilities and would cause a shift in what percentages each of the four classes of real property contribute towards the school tax levy. This could ultimately reduce the Class I homeowners’ percentage, which is the group that pays the largest share of the taxes.
Skate Boards
The district recently installed four benches at the Roosevelt School following the request of local residents to make the area where the basketball courts are look more like a park. Unfortunately, skate boarders have been using the benches to launch off of, and are destroying the faux wood.
Mr. Van Cott said he has two more benches and four trash cans to install but they are not going to proceed with the project. A board member suggested benches such as the Town of Oyster Bay has around town hall: green metal with holes in them.
St. Dominic puts quarters in the concrete so kids can’t use the sidewalks – they are speed bumps, commented someone else.
The school board meets on the first and third Tuesday of the month. The next meeting date is Dec. 7.
