UD-3 board eyes 3.2 percent budget hike
MIDDLEBURY — UD-3 school board members will consider cost cuts and the use of a fund balance to reduce the property tax impact of a draft 2010-2011 budget that includes a 3.2 percent increase in spending. The increase in the $16,025,483 spending plan is overwhelmingly driven by anticipated surges in special education expenses.
While the spending increase is being calculated at 3.2 percent, the potential property tax increase is tentatively being calculated at 5.1 percent — a number that school administrators warned could go up when the Common Level of Appraisal (CLA) is factored in. The CLA is a formula used to equalize education taxes statewide, to ensure that properties of equal value pay equal taxes.
“I have to wonder out loud, if there is anyone here at this table or in this community who thinks that — given the economic situation in Addison County right now — that 5.1-percent-plus is a reasonable figure to present to our voters,” UD-3 board Chairman Tom Beyer said of the property tax impact of the budget, which district staff unveiled at board meeting on Tuesday.
The UD-3 budget represents the combined spending requests for Middlebury Union High School and Middlebury Middle School. Property tax payers in seven towns in the Addison Central Supervisory Union are responsible for funding the budget.
ACSU Superintendent Lee Sease credited MUMS and MUHS administrators for presenting a tight budget that is being hit with some expenses beyond the schools’ control. He noted that of the $495,013 increase reflected in the spending plan, $303,655 of it is directly related to special education services that the ACSU must provide by law. So in essence, about 60 percent of the overall 3.2-percent budget increase is associated with special education — services the district will provide to students “that require extraordinary individual education plans moving from the elementary schools to the middle school,” Sease said.
Officials said the balance of the spending increase — amounting to 1.23 percent over this year — does not reflect any major additions or subtractions of programs at either MUMS or MUHS. It reflects an additional one-third of a custodial position at the high school level.
Administrators started financial planning back in September with the goal of ensuring the UD-3 budget would not run afoul of spending limits prescribed by Acts 68 and 82.
Act 68 is Vermont’s education spending law that establishes per-pupil spending thresholds that, if exceeded, result in a school district having to pay a penalty, the proceeds of which are distributed among poorer communities. The current UD-3 budget draft does not exceed that penalty threshold.
Act 82 is a newer Vermont law that requires a school budget to undergo two separate votes if the district spends more than the statewide per-pupil average and if that new spending rises faster than a state-prescribed inflation rate, plus 1 percent. The current UD-3 draft budget exceeds that Act 82 threshold by $61,764, according to Sease. His calculations are based on a tentative inflation rate guideline of 2.2 percent recently provided by state officials.
Many board members stressed on Tuesday they don’t want to split the budget into two separate articles that would be required under Act 82. With that in mind, they have asked district administrators to report back at their next meeting (Tuesday, Dec. 15, at 6 p.m. at MUMS) with some new calculations, including:
• A list of $61,764 in budget cuts to stay below the Act 82 trigger.
• An overview of how the UD-3 fund balance of $512,189 from the previous fiscal year could be tapped to reduce some of the property tax impact of the spending plan and bankroll some capital improvement projects.
Two major factors contributed to the fund balance (from fiscal year 2009): District expenditures ended up being $223,711 less than anticipated; and the state ponied up $280,535 in revenue for an elevator project at MUHS that had been completed during the previous year.
By law, the fund balance is to be folded into next year’s budget to reduce school taxes, unless district voters opt to set the money aside in a special reserve fund that they could choose to tap for future education purposes, or district officials recommend spending some or all of the money on specific projects that would have to be endorsed by voters.
MUHS BUILDING REHAB
Board members said they don’t want to see all of the $512,189 applied to next year’s budget, because such a maneuver would simply postpone difficult financial decisions until the following year. That said, the UD-3 board has asked Sease to present them with scenarios on how education property taxes could be lowered some by applying various $50,000 increments of the fund balance to the budget. But board members stressed they’d like to use a substantial chunk of the fund balance to bankroll some capital improvements on the MUHS campus, including potentially reconstruction of the circular entrance fronting the main building (recently estimated at $210,000) and an $80,000 roof repair plan.
“We’re costing the taxpayers more money because that project needed to be done three years ago,” said board member Leonard Barrett of Bridport, who is on the UD-3 Facilities Committee.
Board members noted that many taxpayers are hurting in today’s economy. They also noted that Middlebury selectmen have pledged to draft a fiscal year 2011 general fund budget that reflects no increase in the municipal tax rate — for the second year in a row.
Also figuring in board members’ thinking is that Vermont Education Commissioner Armanda Villaseca has asked school districts to consider consolidations, unified boards, level-funded budgets and school teachers taking on 20 percent of their health care premiums, in an effort to contain spending. UD-3 teachers are currently working under the terms of a contract that expired this past June 30. The board and teachers’ union are now negotiating a new pact.
“There is some general anxiety with some people about their own jobs and where they are going to be next year,” board member William O’Neill of Shoreham said. “If all those harbingers are there, maybe we need to cut more.”
“This is a tough time; we’ve got a lot of empty factories and we have a lot of people who have been laid off, and I don’t really see a lot of sacrifice in this budget,” said board member Peter Conlon of Cornwall. “We are carrying forward every program and every staff and faculty member and I am a little torn as to that is where we should be, or if we should be making some bigger sacrifices.”
Board member Devin McLaughlin of Middlebury argued that it is during tough economic times that public education should be maintained and improved.
“(It’s) the wrong time to be spending down on education,” McLaughlin said. “I think it is time to be spending in a prudent way.”