by Dan McClelland
When it comes to approving a new school budget to present to voters later this month, it seems three times is the charm.
At the board’s regular monthly meeting on April 15, there wasn’t a quorum of members present (three needed), so a meeting couldn’t officially be held. The plan was to approve the budget that night, but only an informal discussion of it ensued. Only Sabrina Shipman and Mary Ellen Chamberlain were present.
A special meeting to approve the BOCES budget and the new school budget was set for last Monday morning. The members present for the non-meeting meeting on April 15 were joined by Korey Kenniston. When the new $21.988 million budget was proposed the board voted two to one, with Mr. Kenniston voting no. When a bare quorum of members is present, all three must vote in favor for a measure to pass.
Both Board President Jane Whitmore and Vice President Jason Rolley were both out of town on vacation in recent weeks.
The board convened again Thursday with all five members sitting, with Mr. Rolley back and Mrs. Whitmore connected via Zoom. This time the vote was unanimous in support of the draft budget.
This week Jamie O’Dell, Franklin-Essex-Hamilton BOCES’ director of shared services, who now oversees the Tupper Lake business office, shared some of the details of the budget approved by the full board Thursday. She oversees the district’s new business manager- also from BOCES- Jessica Rivers.
The budget document has been trimmed somewhat since it was presented at the March school board meeting when a 9% tax levy increase was in prospect.
Since then the state legislature approved a late budget which kept the long-time “Save Harmless” in place for school districts for another year so that the $126,000 decrease in state foundation aid forecast was averted for this year.
In the budget proposed by the full board last week there are 17.5 positions to be eliminated. “Twelve of those positions are a combination of either COVID-funded positions we knew had to be eliminated or positions that are being eliminated through attrition- staff and faculty people resigning and retiring who will not be replaced.”
“Then there are 5.5 positions on top of those 12,” which she described as “physical positions” currently held by an employee that will be eliminated.
She listed those: one art position, one music teacher position, one middle/high school special education position, one middle/high school science position, one L.P. Quinn classroom position and half a library media specialist position.
With those cuts done, she said that brings the budget to a tax levy increase of 8.75%- down from a first draft levy figure of 9.1% and under the state imposed tax cap.
The levy figure showing the 8.75% increase represents a total contribution by taxpayers in the three towns $10.383 million- “which is $41,153 lower than what we originally proposed (in March) at the 9.1% tax levy increase.”
The tax levy in the current budget (2023-24) amounted to $9.548 million.
She cautioned that if this budget is not accepted by school district voters, the board has a choice to put a budget to the voters again in June or go to a “contingency budget.”
She said if the board adopts a contingency or what is often called “an austerity budget,” the district will have to eliminate another $835, 450 from the budget.” The would mean more jobs lost, likely.
She explained a contingency budget would not permit the district to exceed the current year’s tax levy. “So we couldn’t exceed this year’s levy of $9.548 million. -And that’s the already scarier part than what we are now facing.”
In the informal discussion on the budget in prospect at the April 15 session, Superintendent Russ Bartlett said there wasn’t a great deal new to report since the earlier meeting in terms of major revenues or expenditures.
He said since the first draft of the budget was released the “expenditure side of it has been decreased by $1.6 million.
He said there had been eight or so full-time positions that had been funded with federal COVID money that has disappeared, “as was intended.”
He said some of that money was spent on additional cleaning in the schools, permitting smaller class sizes at both schools, an additional school nurse, interventionist to help assess and correct learning loss because students weren’t in school. “-And because we had been so long without two school psychologists, one of our psychologists was funded with COVID funds.
One of those professionals left in March, so that is a position we won’t currently re-fill, he told the two board members present that evening.
“We had a couple of teaching assistants retire. We also had several other retirements that we will attribute to attrition.”
“The part that is painful” were the positions cut, that were listed by Ms. O’Dell above.
In addition to the full-time faculty cuts, were five what he called “para-professionals”- aides or teaching assistants.
While several of the five were leaving through attrition, the balance were people serving or acting in teaching roles, because there weren’t certified teachers available to hire, he noted.
“We can now free up a few teaching positions that can actually be filled by teachers.”
“Other significant expenditures we’ve reduced are most of our JV sports and “a fair amount of new athletic equipment” to the tune of over $100,000.
“Dan Bower’s retirement will leave us with an empty assistant superintendent’s position, which will not be filled in title as an assistant superintendent.”
“-And you remember last fall when Mr. (Lee) Kyler left, that was another administrative position that we have not refilled,” he continued.
He said through BOCES services and other contractual items, “we were able to amass about $400,000 in savings there.”
He said the difficulty of eliminating spending on BOCES programs and services, the district shorts itself on BOCES revenue, which can be as much as 50% of expenditures.
“It’s a ‘for now’ savings, but that $400,000 will not come back to us every year.”
“I spoke with Mayor Mary Fontana this afternoon.” The superintendent said the plan was for school, town and village leaders to meet soon to come up with the best solution for funding school resource officers in the future.
He said the need to keep the officers in place in each school was one of the things residents in the community feel strongest about keeping, judging by his recent conversations with folks in here. “The community has been very vocal about wanting to see them remain!”
“So we are working on ways to fund them- albeit a little differently than in the past. -And, at this point, it is reasonable to think we can keep the school resource officers!”
The cost of the officers’ salary and benefits amounts to about $140,000 per year which the district pays the village.
“Currently the budget we are looking for the board to approve” would be $21.918837 and that’s with a tax levy that is under the tax cap. I’m happy we have been able to get under it!”
Asked by Mary Ellen Chamberlain about the elementary school faculty and staff cuts, Mr. Bartlett said they included a cleaner, a K-5 general education teacher, a K-5 special education teacher, school psychologist, school nurse, two middle/high school interventionists and one elementary school interventionist.
“As Russ mentioned, I don’t think there’s anything new since the last time,” Ms. O’Dell told the two board members and the administrators present for what was supposed to be the regular monthly meeting.
“We have some deadlines coming up” with respect to the budget and its adoption.”
She opened a discussion on the fund reserves the district needs to create. “Any time a reserve is established” for a specific spending or budgeting purpose that has to be passed as a proposition on any district ballot.
“Tupper Lake only has two reserves at this point”- the unemployment reserve and an Employee Benefit Accured Liability Reserve (EBALR) and combined they total about $500,000.
“What reserves are are basically savings accounts for the district, but it is a savings account that is not only advantageous for this school district, but also for local taxpayers. It’s a way that OSC (state office of state comptroller) prefers for us to have extra dollars. It doesn’t like anything over the four percent unassigned fund balance.”
She said as of last June, the district’s fund balance figure was 4.8% “-and so you are in a pretty good position.”
She said reserves help districts prepare for unexpected things in the future. “For example with your unemployment reserve, that permits you to pay claims in times when there are times of lay-offs and cuts.” The claims money comes from the reserve rather than a district’s general fund.
An EBALR can be used when employees retire and its written in their contracts that they get paid for all their accrued sick time which could equate to $10,000 or more, she explained. Again, instead of paying that sum out of the general fund in any given year it could come out of that special reserve.
She said the EBALR can be permitted to build to the amount of all of your liabilities that exist with your current staff.
She proposed the district create TRS and ERS reserves, which can be done by the boards and which don’t require taxpayer approval.
Another valuable reserve for the district to have is what is called a capital reserve, which can be used for many things including the purchase of buses, capital equipment like plow trucks or boilers, supplements to building projects to lower any local impact on taxpayers.
They can also be helpful, she said, to cover “unplanned projects” when they suddenly arise, like the presence of previously unknown asbestos or mold “that can cost a pretty penny for a district to abate.”
“It would be my recommendation to take a look at the reserves you have now, those you could create and put forth a plan,” she advised the two board members present.
Mr. Bartlett said the reserve creation doesn’t involve the spending of more money, but a more structured way of categorizing the money we are taking in each year.
“The other thing I wanted to point out is that when we originally looked at budget numbers and a $1.7 million shortfall, it was devastating and it is. And then we started looking at the facts that the COVID money was going away and that this person was leaving and we wouldn’t have to replace that person. But whenever you have a position and you see the impact that person has on a kid...a kid who might have been struggling without intervention and then you start to see them succeed, you think how great it would be to keep that person or that position in place.”
“-And then you start to convince yourself there is a way to keep that position. But then when you look at the dollars coming from state ed., you realize there is no way to keep that position!”
He said they knew with the COVID money drying up and the retirements coming there would be positions to be eliminated. “Some of them we had already written them off to attrition.” But of the actual half dozen or so teaching positions that had to be eliminated that hurt him deeply.
“I hate losing an art teacher...I hate losing a music teacher. Hopefully overtime the financial situation in the district will improve and they can be restored. We’ve lost both those positions in the past but over time we were able to add them back. So my hope is that as time goes by and funding cycles change, hopefully we can add them back soon.”
“I think Jamie and Jess and the building principals and Trish (Wickwire) found a lot of ways to make this budget balance that didn’t tear away a lot of things from kids that we thought we were going to lose in the beginning.”
“I wish there was more we could do. I hate to lose the people we have to lose. But I think we’ve done a fairly good job at maintaining the integrity of ability to educate kids, pre-K through 12!”
The Free Press publisher asked how the $1.7 million shortfall occurred this year to create this budget dilemma. He said that seems to be troubling the public the most these days.
“A million of it are the COVID funds that we used in recent years and now they are gone,” Business Manger Jessica Rivers told him.
The balance, she said, reflect “raises and increases in health insurance premiums over the years. In addition to that was the unassigned fund balance.”
“Was the COVID money spent when it shouldn’t have been?” Mr. McClelland asked her and she replied, no.
“The COVID funds arrived in different pots,” she said referring to different federal funds that came to address different problems created by the pandemic and the profound school absences that it caused.
“The last bout of it cycles out in September, 2024.”
She explained that all of the funds in the first rounds were spent in accordance with the requirements of each. The money that was left and that is being spent this year and over the summer of 2024 that’s the remainder of it.
The superintendent said the federal money had to be shown as revenue in the district’s budgets during the COVID years. “And now that revenue doesn’t exist in this year’s budget!” he told Mr. McClelland. “So that’s where the first million dollars went.”
Mr. McClelland asked if there was a lag in federal money arriving to fund programs already underway. “Were we employing people we shouldn’t have had?”
The superintendent said the district wasn’t. There were eight positions funded through the end of this school year” with the COVID funds.
Ms. Rivers said the federal funds came as grants allocated on the basis of the special programs offered by the districts. There were grants that came annually. It all depended on the grant program. Some had carry-over funds attached to them. Some did not.” She said some of the grants had different end dates.
The last federal fund was for a program that will end September of this year, she noted.
Ms. Rivers said the “district has also been balancing it budget with an unassigned fund balance...so you’ve had a gap for years!”
“Did the gap just keep rolling over and over,” the publisher asked and Ms. Rivers said it had. “If you go back and look at your revenues and where they were coming from before the arrival of the federal funds, you’ve always had a contribution (to the budgets) from the unassigned fund balances.”
“You can use unassigned fund balances to balance their budgets, but we always caution districts from doing that because it can suddenly go away or run low, where Tupper is now!”
“At the end of last year the district fund balance was at 4.8 percent of the budget, which is very low!”
She agreed with Mr. McClelland that state auditors like districts to keep their fund balance low and in the range of 4%.
“But in our eyes, running a school district year to year to year, 4.8% will not get you very far” when problems arise.
She some districts carry fund balances of 12 and 13%.
Jamie O’Dell said that realistically what this district should be doing, as per state regulators, is keeping an unassigned fund balance of 4% of total spending but create other reserves for particular purposes (as outlined above) to provide a suitable financial cushion for times of emergencies and surprises.
Many local governments have equipment purchase reserve funds or capital reserve funds, and others, Mr. McClelland noted.
“The contradictory thing we hear from the state is if our fund balance exceeds 4%, we have to write a corrective action plan. If you go back to 2010 (which saw a major lay-off of faculty and staff) and with the arrival of the gap elimination assessment, the average cut to districts across the state was 8.8% and the state said just use your fund balance. So on one hand the state will slap you on the wrist if you exceed a fund balance of 4%, but it will expect that you actually have one more than that!”
“So after this year, once the COVID funds are gone and corrected for, will we still have a $700,000 gap?” Mr. McClelland asked.
Ms. Rivers said this year’s budget should eliminate the gap, with the exception of the $250,000 that the district is still using in its budgets as an unassigned fund balance.
In recent years the board members have used $350,000 from the district’s fund balance to apply as revenue in the new budget. That figure has been trimmed by $100,000 in the proposed budget.
“We’d love to see Tupper Lake lower that amount again a year from now because it cannot sustain putting that much unassigned fund balance into each year’s budget.
