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Dr. David Hopson |
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December 11, 2006 It’s that time of the year again when thoughts should turn to the holidays but instead are mired in preliminary budget discussions with school administrators and the school committee. It continues to seem somewhat inane to be developing a budget when we are less than halfway through our current budget year and we are forced to work with ‘best guess’ estimates on both expenditures and income. However, I understand the legality of having a budget completed--and assessments to the towns—45 days before the first annual town meeting. I give our towns credit for trying to make this process more workable for all by changing the dates of town meetings, even though that requires a legislative act. One key question regarding the town’s cost for education will not be answered until much later in the year because the local assessments are dependent upon both expenses and the amount of state educational aid that the district receives (Chapter 70 aid, regional transportation reimbursement, and “Title” funding determined by the federal government). We’ll be looking to see what the governor elect’s budget provides in late January, followed by estimates from the legislators in the spring. There appear to be promises of more aid from all sources but the reality is what really counts. I am sharing very preliminary numbers with you this week, reflecting our current best estimates on what expenses will be (i.e., will the winter be colder than average and require more oil to heat the buildings, or warmer than average saving fuel costs?) Also at this stage we’re looking at three very basic budget parameters—level funded (cut services to keep the budget the same dollar amount as this year); level service (increase the budget to provide the same services at next year’s cost); or a progressive budget (looking at, and funding, additional needed services). Without any changes in services to students, the budget will increase by an estimated 5.1% or $836,914. Major categories of increases are estimated health insurance increases of 12 and 15%, increases of over 10% in other types of insurance, an increase in fuel adjustments for bussing, a principal and interest payment on the building project (the town’s share), increases in labor costs, and an increase in heating and utility costs for the schools. These estimates will be adjusted as we progress through the budgeting process, so that the town assessments right up to the actual town meetings will more accurately reflect the true cost to the district and our towns. Why do district costs increase so much more than the rate of ‘inflation’? This is because the commonly cited inflation rate takes into account a broad cross section of the economy that has little relevance to the schools, i.e., housing, food, and automobiles (many imported from low-wage countries). If we only consider the national increase in costs of the items that make up a school budget (professional salaries, health insurance, specialized health and educational care) we’d find a much more closely aligned set of numbers related to the increased cost of providing services. We can all recognize the inherent difficulties in budgeting when Proposition 2 ½ limits the tax increases to 2 ½ % plus new growth—budgets grow faster than our ability to pay, leading to some very difficult choices. For most of the 90’s these difficulties were hidden by increases in local aid. When the state’s economy went bad in 2003 we saw increases in taxes and drastic reductions in services in both the schools and the towns. Similar to the towns, the Gateway School District is still recovering from cutting 20% of our staff in fiscal year 2004. We are not alone in this struggle and a group of rural regional schools is looking at ways to adjust the state formula to account for population changes and population density to potentially ease this situation. I’ll keep you informed as this group moves forward over the next several months. ### |
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