In the April 11 edition of the Longmeadow News, Select Board member, Mark Gold responded to recent comments by two School Committee members about FY2014 budget process.
In the March 28, 2013 edition of the Longmeadow News there were two opinion columns, one by School Committee member John Fitzgerald and the second by School Committee chair Michael Clark that presented the School Committee’s opinions about the current Longmeadow Town budget process. Since it appears that the residents of Longmeadow will be receiving their information in the Longmeadow News about important topics such as the budget through opinion columns rather than an objective reporter’s article, I feel it necessary to respond to both these opinions by offering my opinions on this discussion.
Let me start by making it clear that I have, and continue to support a compromise budget with the School Committee. Even before this process of dueling budgets began, I reached out to School Committee member and school finance sub-committee member Jim Desrochers to see if there was a compromise budget that could be agreed upon. Although I am not particularly fond of the compromise that has been proposed, that is in fact the nature of a compromise, a budget that neither side is entirely comfortable with but one which can be taken forward for the Town’s Fiscal 2014 budget.
Having stated my support for compromise, I also, however, feel it important to communicate to town residents why I feel it was reasonable to request that ALL town departments, from accounting to zoning, from Parks and Recreation to Schools, prepare a fiscal 2014 budget at the same level as Fiscal 2013. In fact, all town departments except the school department met that budget directive. It is also important to communicate exactly what a level funding is, because even that was an early point of disagreement between the School Committee and the Select Board.
What is Level? During last year’s budget process, the Select Board and School Committee jointly identified an annual expense of $110,000 within the School Committee budget for the rental of a fiber optics system from Verizon that served both general government offices and the schools. At the recommendation of the Director of IT, it was jointly agreed that the town would purchase a fiber optics network, remove this $110,000 from the school’s annual budget, and use those funds over the next 8+ years to pay off the bond that purchased the fiber optics network. It was agreed that for FY 2014 and beyond the school committee budget would therefore be reduced by $110,000 (or slightly less to account for the cost of a service contract for the purchased network) to reflect the capital costs of this purchase. With the FY 2014 budget that was first proposed by the School Committee, it was claimed that the budget was $635,000 above last year’s budget, but in fact it was $735,000 above the “level funding” budget that had been jointly agreed upon. A small point, and perhaps it was just semantics, but it took several weeks before the School Committee acknowledged that the submitted budget represented an increase of $735,000 above last year.
Recent tax history and capital needs. The Longmeadow tax rate for the current fiscal year (FY13) is $21.54 per $1000 of evaluation. This is an increase of 9.45% over the FY12 tax rate of $19.68 per $1000 of evaluation. This increase is the result of three factors: A general budget increase that raised tax revenues by 2 ½ %; the Proposition 2 ½ exclusion of the cost of the bonds for the new Longmeadow High School; and the reduction in tax revenue from large taxpayers such as Twin Hills Country club who successfully challenged their tax classification.
Despite this significant increase in tax rate, the Select Board recognized the need to begin addressing infrastructure needs that had been long neglected; road repairs, sidewalk repairs, and storm sewer outfalls all need substantial improvements – improvements that required capital funds. Although the Select Board could have asked town residents to fund these projects through debt exclusion bonds (bonds that are paid for in addition to the Proposition 2 ½ general tax increase) this approach was not taken for two reasons. First, the amount of capital needed for currently identified repairs to these three areas (roads, sidewalks, storm sewers) would have required a bond that is up to two times the amount borrowed for the high school. That’s right; road, sidewalk, and storm sewer outfall capital needs exceed $60 million. Secondly, it was felt that a way had to be found to begin to include the cost of these capital repairs into the general operating budget so that we could tackle these infrastructure issues over time without exceeding the proposition 2 ½ levy limit. I did not feel that it would be wise to add to this year’s 9.45% tax increase with a tax proposal for next year that would also exceed the proposition 2 ½ % levy limit. Luckily, there were several issues at work in the town that would allow us to provide funds for beginning the infrastructure improvement program without increasing taxes above the 2 ½ % levy limit. The starting point for providing this capital infusion was level funding for operating department budgets.
Why a level funding request is reasonable. But I digress from the purpose of this document, which is to put forth why I believe a level funding request to all town departments, including the School Department, was reasonable. There are four reasons I felt that the town departments could submit a level budget for 2014 vs. 2013.
First Reason: Turnbacks: The first reason to expect a level funded budget is that for many years the budgets of both the general government side of the ledger and the School Department side of the ledger has exceeded the funds needed to run those departments. Year after year, money has remained unspent at the end of the fiscal year. This money is returned (or turned back) to the town and is euphemistically called “free cash”. It’s not free, you and I paid for it in taxes. In the past four years these funds have ranged from as little as $400,000 to as high as $800,000. Why are town departments asking for money that is apparently so desperately need in May, only to return it unspent a year later? In a word – contingency. On the general government side of the budget, we are required by state law to approve budgets department by department. Not quite as restrictive as the line item budgets of the past, never-the-less the town departments must estimate in May how much money will be needed in the upcoming year. For example, on the general government side of the ledger, funds allocated to the police department’s wage overtime line item cannot be supplemented by funds available from not fully spending funds on legal fees. Since police department overtime is used to pay for OT needed to book criminals, watch prisoners in our cells, or testify in court, one can only estimate the overtime that will be necessary. In a year (such as this) where there was a string of house breaks requiring extensive OT, that budget was fully utilized. We cannot supplement Police Department overtime funds in January by transferring funds from Park and Rec, only a town meeting can put more funds in that budget. But the School Department budget is different. The School Committee has line item autonomy. Working with just a “bottom line” budget, the School Committee can and does shift funds from line item to line item. They can alter any budget line item needed – as long as the bottom line remains unchanged.
The Select Board has worked hard to minimize turn backs, and with a track record of consistent turn backs it was felt that better budgeting would prevent us from raising tax money that wasn’t going to be spent – and with the line item flexibility within the School Department a budget request that would minimize next year’s turn back of funds was reasonable.
Second Reason: payroll attrition: The second reason to expect a level funded budget is attrition of employee salaries. The salary structure of the general government and schools often include payments for longevity and steps for years of service to long-term employees. The natural attrition of employees that takes place year after year has become statistically predictable. It’s time we started budgeting for that attrition. This year the general government included these salary changes in our budget process – some through true attrition (including the town manager) such as the police department and some the result of the unfortunate deaths of two key town employees. There are retirements in the schools every year, and it is not unreasonable to ask the School Committee to include in its budget a reduction that reflects the approximately $100,000 in lower salaries that result each year from hiring new employees at the bottom of the pay scale or without the steps or longevity of those departing employees.
Third reason: designated fund accounts: The third reason to expect a level funded budget is that the School Department has significant money in designated fund accounts. These specific accounts total over $750,000 and although not all the funds in all accounts can be made available (some are indeed restricted use funds), accounts such as the parking lot fund (money raised from student parking fees) will clearly not be needed to renovate the new high school parking lot (one of the stated uses for the fund when it was established) for years to come. There is $40,000 in this parking lot fund that can be used for one time purchases, thereby reducing the overall school budget by that amount. The parking lot fund is just one of many designated accounts available to the School Committee to moderate their budget for 2014. The general government budget has been using one time funds (free cash, reserve fund) for several years to balance the budget – it’s not unreasonable to request the school committee do the same.
Fourth Reason: enrollment decline: The fourth reason to expect a level funded budget is that there has been a significant decline in school enrollment over the past five years, and neither school department staffing nor funding reflects that enrollment reduction. Since the 2007-2008 school year the enrollment in Longmeadow public schools has declined from 3157 students to 2868 students this year (numbers from the Mass Department of Education). That’s a reduction of 289. Since 2004-2005 the numbers are down 499 students, with a further projected decline of over 30 students next year. During this same five year period where enrollment has declined 10% the school departments non-cafeteria staffing has increased as has their overall budget by over 10%. It is not unreasonable to expect to be able to hold the line on expenditures one year out of five in the face of reduced year over year enrollment.
As I stated at the outset of this article, I favor finding a compromise budget position with the school committee. I have provided these comments because there have been opinions published in the Longmeadow News that present the Select Board’s budget directive as either arbitrary or unreasonable or both. Nothing could be further from the truth. The Select Board’s budget directive was and remains a reasonable expectation.
In his opinion article, School Committee member John Fitzgerald chose to characterize the Select Board as “a collection of five individuals who can pretty much do what they feel like doing”. Nothing could be further from the truth. Select Board members are answerable to ALL town residents, even those who do not have children in the town school system. We deal with a myriad of issues from underage drinking violations to water and sewer rates. The breadth of responsibilities of the Select Board requires that our actions be guided by the Town Charter – a document that supersedes the need for a catch-phrase based vision statement. As for his opinion that members of the Select Board “do not have to offer evidence to support their views”, and that few of our meetings “feature real policy debates”, he clearly has not attended or watched many of the Select Board meetings. Unfortunately the contents and details of neither Select Board nor School Committee meetings are reported in depth in the Longmeadow News, but Mr. Ftizgerald is mistaken if he believes that his ability to pen a well written, but error filled opinion column will be the definitive word on the workings of the Select Board.
The operations of Longmeadow Town government, particularly the relationship between the School Committee and the Select Board, should not be a win-lose alternative as Mr. Fitzgerald “predicts” in his column. Such a statement indicates an unwillingness to work toward a solution that best benefits ALL town residents. The use of press releases couched as opinion columns that portray only one side of an issue do little to encourage the town residents to understand the complexity of issues that the town is facing. I encourage Mr. Fitzgerald to join the other members of the School Committee and work toward a budget that recognizes the realities of 21st century municipal financing, one that the entire town can live with.
Longmeadow Select Board Member