Explaining a “structural deficit ” and City Manager did take $300K back

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In UTL President Paul George’s letter in today’s SUN he writes:

we have been informed that the School Department has a structural deficit of more than $1 million and that the city manager has taken back $300,000 in money already appropriated for our schools.

Mr. Georges is correct in both instances. however the first item about a deficit has been known since the School Committee approved the Fiscal 2015/2016 budget. The School Dept had roughly $4.8 million dollars in “free cash” at years end. They also knew they were short about $1.2 million in cost of existing programs and staff.

Rather than cut staff or eliminate programs, the Committee used $1.2 million dollars of the Free cash which is one time money to fund those programs and not have to lay off staff, some who might have been UTL members.

So technically the School Dept. does have a $1.2 million dollars structural deficit but they have done the same thing before and did so in public and posted the information in the budget presentation.

The Projection by State is that Lowell exceeded its net school spending by approx. $300,000 so because the budget on the city side is so tight, the Manager decided to take back the $300,000 overage.

Finally Mr. Georges also wrote the following:

the UTL informed the committee of the pending elimination of the healthinsurance trust fund, containing approximately $7 million, with $3.5 million to $4 million due to the School Department, as it had already been charged to the School Department by the city. The School Committee did nothing to recover that money, as former City Manager Lynch appropriated it elsewhere with no input from the School Committee whatsoever.

Paul George’s knows exactly where that money went and why it went there bu chooses to not state that fact. The money was used to fund the City’s OPEB Trust Fund which pays for the health insurance for retirees many of who are former school dept. employees.

I’m not sure what Mr. Georges thought would be gained by this letter. Pointing out a “structural deficit” seems to me to work against the union. If the school dept is already running in the negative has Paul claims, doesn’t that mean there is no money for raises?

If you can’t pay the bills that are there now, how can you increase cost by giving raises?

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