If you appreciate irony you have to appreciate that on a night where the School Committee awarded the Supt. a 4 year contract with a 10% guaranteed salary increase, they are presented with the 2017/2018 budget that possibility contains around a half million dollar structural deficit.
The current House Budget has of 1:00 pm Friday showed the expected amount of Chapt70 aid to be $144,067,633 which the Supt. based his budget on.
However with the recent State DOR release about the lower than expected April revenues($241 million short of projections) the city / school dept. will be lucky if the number doesn’t decrease lower than the Governor’s / City Manager’s January estimate of $143,520,403
If Chapt70 funding somehow stays the same, when you add in the $18,005,691 in CASH contributions from the City the operational budget for the schools would be the Superintendent’s $162,073,324 recommendation which is $3,628,096 more than last year.
$547,230 hirer than the $161,526,094 the City Manager proposed in January. However that budget is built with some presumptions that haven’t been proven.
If you look at the last 2 years the City has funded the schools with a “Cash” contribution of $18,856,851 & $19,856,851. This year that has dropped back to $18,005,691 which is $851,160.00 less “cash” than last year due to another large increase in charter school cost.
It is important to realize that the amount of Cash contribution affects the School’s Operational budget. In-Kind or Maintenance of effort contributions are important and appreciated but those line items generally have no direct impact on the Operational budget but does on the city’s Net school spending requirement.
Transportation is NOT a chargeable item to the City’s Net School Spending and is a city NOT a School Expense but the cost is deducted from the city’s cash contribution.
The cost of Transportation went from $7,819,660 up to $9,043,069 an Increase of $1,223,409.
Adult Education which Lowell has been a leader of for many years is also not counted toward the Net School Spending requirement and is also deducted from the cash contribution of the city. That cost this year is forecasted to be $500,011
Health Insurance for the Schools has increased but not as bad has it has for those of us in the private sector. This year’s increase on the school side is $1,320,229
So between the increase in busing and health insurance ,the cost of Adult Ed and the reduction in Cash from the city there is a decrease of available cash in the amount of $3,894,809 to use for operational budget.
Health Insurance, transportation and Adult ed cost are reoccurring but the increase in transportation due to a new contract (which has the min. wage increases and mandatory health care and paid sick days that the companies need to address) was larger than expected and the decrease by the city of $851,160.00 in cash though known about in January still has a negative effect on the operational budget.
The School Dept. to try to offset the loss of the cash from the city has apparently unilaterally made the choice to transfer the salary of the 3 School Resource Officers they funded to be funded through the City of Lowell’s budget. That is estimated to be approx. $263,594
On page 6 in the budget presentation it states
All maintenance is covered under the City budget. The Heating Maintenance, Energy Management Systems and two Plumbing positions that were in the Lowell Public School’s budget for FY2016-2017 have been eliminated.
That is a savings of $201,408 on the school side.
However on page 34 of the budget there is a line item that reads Building Repair & Maintenance funded in the amount of $227,000. There seems to be a conflict in philosophy here. Either All maintenance is covered or just some maintenance is covered. Will the current School Committee ask about this mix message? or try to either reduce that amount or worse for the city transfer transfer that amount and try to force the city to fund it.
The savings for the schools between the 3 resource officers and the other positions is a total of $465,002 which appears to be a deficit in the budget because it is my understanding that the city has not agreed to it. If you look at the fact that they decreased the cash by $851,160 do you think they would voluntarily add back $465,002?
That number may be much higher with the new contract for the Superintendent that specifies the “District” will conduct an audit of the books and accounts yearly. There is no money identified in the budget to pay for these audits and the schools have multiple accounts for City, State and Federal funds so doing an audit will be a costly process. If the Committee doesn’t fund that and audits are not done, aren’t they violating their agreement with the Superintendent and opening up a possible lawsuit for a violation of the contract?
Having been blogging and doing the radio on Saturday Mornings I’m also aware that in a city that has a budget of approx. $340,931,235 Lowell has very little “free cash”.
Free cash is a misnomer, it is the amount of your budget for the previous fiscal year that wasn’t used. In Lowell last year that number was $1,333,385 slightly up over the $942,033 of the previous year.
The State (DOR) recommends 3% – 5% excess be built into a budget and for the past few years Lowell has been around 1%.
When you compare Lowell with some larger communities like New Bedford, Worcester , Fall River and Springfield you will see that Lowell is well under those communities in “Free Cash”. This and the previous City Council’s and the Manager’s have done their best to run Lowell with a low tax rate (though many think we pay to much) and have purposely NOT raised the property taxes 2.5% a year the way most surrounding communities do. That has allowed the city to be in position to fund the High School project without the need to have to do a proposition 2.5% override or a debt exclusion.
Believe it or not the city side is run on a shoe-string while at the same time I believe this Council and this Manager have shown a strong commitment to the public schools.
On Wednesday night the Committee also voted to ask the Supt. to renegotiate the Maintenance of Effort or Charge back agreement the city uses to meet or exceed has they have under the Murphy administration their Net School Spending requirement.
So now besides the fight over where to build LHS which has gotten nastier and the potential fight over if we can afford to do a new LHS and how we will fund it, it appears armed with his new 4 year contract this Superintendent with School Committee support is ready to challenge the City Manager and press th case for an additional $465,002 and to try to force the City to reduce their maintenance of efforts cost while increasing their cash contribution.
By taking that vote the School Committee seems to be supporting an us against them mentality Schools versus City needs. The Superintendent came to Lowell with a reputation that he didn’t work well with city or town administrations and in December of 2015 told the Sun “I’m not an easy person to work with.”
With a June 13th date approaching for the High School project and with a city divided over location, is looking for more cash this School Committee’s way of trying to push the cheaper downtown location? Remember many members of this committee strongly back the downtown location and by advocating for an increase in cash are they trying to give Councilor’s a reason to support the downtown by saying we can’t fund the highest priced location and support the schools the way they want us to?
All of a sudden the School Committee which voted 6-0 in September to ask the city for an additional $527,524 but never followed up on it is pressuring the City to reopen the Maintenance of Effort agreement and allowing the Superintendent to change the agreement and present a budget which calls for over $400,000 more than what the city has an agreement on. Are they purposely trying to influence the location by telling the Councilor’s they want more cash and if we go to Cawley they will lobby the parents and unions for funding at the expense of city services?
The proposed school budget has $1,000,000 in a reserve account that I believe is set aside for teacher’s – para and principal raises. Paul Georges the UTL president Wednesday night urged the Committee to lobby the Council for more funding.
He wants the us versus them. He doesn’t answer to the taxpayer’s / citizens he just wants more funding for his union. If the committee can guarantee the Superintendent a 10% raise with no evaluation required, he’ll want a guaranteed raise for his union. By voting to eliminate the Library aids and making them paraprofessionals this School Committee has strengthened the UTL who represents the Para’s but didn’t represent the Library aides.
Again by not asking enough questions about financial matters this Committee has strengthened the union and are encouraging the us versus them mentality. That is not beneficial to the students, parents and especially taxpayers who are all ready facing a large tax increase. At a time when the city is looking to fund $130,000,000 or more through a 6% – 7.5% tax increase for a New High School, I’m not sure the taxpayers or City Councilors would be willing to increase taxes more because of this committee’s lack of fiscal responsibility.
If the Senate has to cut more things could be even worse…it’s going to be interesting to see if the School Committee will appear before the Council to ask for more funding. If they will suggest cuts to the budget or if they will ask the Superintendent to find that amount during the upcoming year.
The next few weeks will be fascinating…