Thursday, May 1, 2014

Potential Consequences of ATM Budget Amendment

This following letter was submitted by Marie Angelides, Chair- Longmeadow Select Board.

On May 13th at 7:00 pm Longmeadow will hold its annual town meeting. This year it will be especially important for residents to come and have a voice in the decisions being made on the town budget. The town manager, Stephen Crane, the Departments, and committees worked hard this budget year to go from an over $600,000 projected deficit to a balanced budget that allowed for increased hours at the Adult Center and a new program in the elementary schools costing over $500,000. This balanced budget was $170,000 under the 2 ½ percent tax levy. The extra money was put towards infrastructure.

As you may have read in the papers, residents have not been happy with the School Committee’s decision to fund the literacy program in the elementary schools and charge tuition for full day kindergarten. The superintendent had a series of meetings emphasizing the importance of full day kindergarten, but prioritized funding for the “literacy program” instead that replaced teacher’s aides with certified teachers in each of the elementary schools to improve test scores.

At town meeting there will be an amendment on the floor asking for an additional $400,000 in the school budget to eliminate the tuition for full day kindergarten.   The residents believe that the funds in the Town’s Operational Stabilization Fund and/ or Free Cash should be used to pay for the tuition.

I will be speaking against the amendment. The Free Cash being referred to as a funding source is the projected Free Cash that is will not be certified until the Fall. Responsible fiscal policy is that any projected, Free Cash (unused funds budgets and projects) should not be used until certified after FY14 in September and that the money be used for non-recurring expenses such as Capital or emergencies such as the October 2011 storm. The Town also has a policy that states any unobligated Free Cash over $500,000 be placed in the Operational Stabilization Fund. Rating agencies such as Moody’s look very poorly on the use of projected uncertified Free Cash to balance an operating budget. Rating agencies recommend that a town have   5-10% of the general fund expenditures in the Operational Stabilization Fund. We are at 6%.

By ignoring our own fiscal policy and municipal finance best practices and use the Operational Stabilization Fund or uncertified Free Cash to balance an operating budget, we risk our credit rating and risk higher costs for borrowing in the future.

For the above reasons, if the amendment to fund full day kindergarten passes, the Select Board will be obliged to cut programs and staffing on the general government side of the budget. These are programs that benefit the entire town. The cuts will be noticeable and, in some cases severe. Raising taxes does not appear to be a reasonable option; taxpayers have already absorbed an increase in taxes to build the new high school.

Unfortunately, the choices here are difficult. If the residents want to cut programs, hours, and staffing to support a full day free kindergarten, the Select Board will move ahead with those cuts. In either case, the will of our community will prevail. I urge all of you as citizens to come to the Town Meeting and have your voice heard and your vote counted in this very important matter. 

Thank you,
Marie Angelides
Chair of the Longmeadow Select Board

1 comment:

Anonymous said...

I question why the Select Board is stating that they would reduce town services and cut jobs if the amendment passes when they have historically used free cash to prevent that from happening.

Does best fiscal policy prevail over basic ethical practice? Past actions by the Select Board's use of free cash to protect town services would say it does not.

As seen on page 34 of the FY15 Town Budget:
“It is the policy of the Select Board not to utilize anticipated reserves (free cash) to fund the operational budget. In as much as it has been done so in past years, it mainly has been done so not to reduce services to the residents of the Town.”

Full day kindergarten is a service to the residents of the town and the ONLY kindergarten program being recommended by the school district for all students next year.

The only way to ensure that every child, regardless of ability to pay, will receive the full day kindergarten program that the school district is highly recommending in order for students to learn all that is required, is to fund it.

Using funds from the 1.1 million that is expected to be available in free cash would protect all town services, jobs, programs and town capital projects (well over the recommended 2%) that the select board voted to fund in FY15.

The free cash would be used to fund the kindergarten program for the first year only. In subsequent years the kindergarten program would be made part of the school’s operational budget. At that time the program cost would be less than the initial year’s due to an increase in chapter 70 funds for transitioning to full day K without tuition and the absence of startup costs. Also important to keep in mind that the school department came in $190,000 under budget for FY15.

87% of Massachusetts’ kindergarten children currently attend a full day kindergarten program and 84% of those students do not pay a tuition. Those numbers will be higher next year.

Utilizing free cash to help transition the school to full day kindergarten protects all town jobs and programs while ensuring equal access for all children to the public education our school district highly recommends for them to learn all that is required.