City Cash contribution less than 1989 / 1990 levels…Severe cuts inevitable

Motion by me on this week’s School Committee Agenda:

Based on the City budget the past 2 years and anticipating the City will provide at most approx. $650,000 of their required $2,000,000 increase in Net School Spending in the form of an additional cash contribution. School Committee direct Superintendent to provide report showing savings if we eliminate All Pre-School Programs, Adult Education , All Varsity/ JV / Intramural Athletics programs and rezoning School District for 2019/2020 School year.

We are facing $2,000,000 – $3,000,000 in cuts unless we receive a more fair distribution of the City’s Net School Spending Requirement or more funding from the State Chapt. 70 account from the legislature than the Governor’s budget projects.

I get these are DRASTIC options to look at and some will say DRACONIAN but they are the type of cuts that will be required without more cash contribution instead of SERVICE FEES from the city. By Law we are not responsible for Pre-K or Adult Ed, we are not obligated to offer sports, we know if we rezone we could save between $700,000 – $800,000 in Transportation cost. Nothing will be off the table if we have to make these reductions….No after school transportation, no tutors, no music / drama after-school programs, eliminating Asst. Principals, combine and reduce Department Heads at BOTH Central and LHS..

I’m not asking the city for Additional Funding I’m asking the City to review their current distribution of their mandatory funding and to increase the cash contribution of their required Net School Spending by decreasing the maintenance of effort charges by the same amount.

While the City ON PAPER shows they “continue to meet and exceed” NET School the fact is, it’s a paper game with numbers presented in the form of half the information. When you hear we will give all the Chapt 70 money to the schools including any increases after the budget is set, sounds great, The fact is the city cannot use Chapt 70 funding for anything but education. When you hear we have a $350 million budget and half of that is given to education it sounds good but they don’t tell you $150 million comes from chapter 70 state money. They never tell the public that they supply only 33.5% of the total net school spending requirement in the form of cash and the rest is done has chargebacks because people would question that. When you hear we exceeded NET School Spending but look at see that was achieved by Charging for Services rather than actually funding these services, it makes a huge difference.

The State provided Unrestricted Local Aid to communities to assist with the cost of Education but there was no mandated specified State / City requirement that exist now. During the late 1980’s even in a state of recession, the State was able to provide local aide equal to 25% of what was needed for education. It was due to not having minimum contributions and a solid core funding amount among other issues that drove the creation of the Ed Reform Act passed in 1993.

In 1980 the City funded $22.8 Million dollars of the School Budget in CASH!

In 1989 the City funded initially $40 Million then later during the fiscal year another $3,500,000 from Water and Sewage and then in the spring another $605,000 in unused snow and Ice funds

In 1990 the City funded $46.5 Million with the State supplying $5.6 Million

The City still had to plow snow at the School parking lots, pick up trash and do the auditing..etc.

In 2019 the City Funded $15,736,053 in Cash

In 2020 I’m projecting based on my short experience on the School Committee a Cash contribution not more than $16,400,000.00

In the current School Year the State in the form of Chapt. 70 monies supplied the city with $150,935,483.00

The City was required by Law to “contribute” $47,400,845..they provided the School District with $15,736,053 in Cash slightly over 33.5% which means that over 54% of the required NET School Spending is being CHARGED to “services”. ( some money gets used for Charter School offsets that’s never been clearly explained or defined)

On top of that, the School Department is required to pay the cost of Transportation out of the Cash contribution so that drops the actual cash to approx. $6,736,053 or around 14% of their required NET School Spending.

The ability to “offset” cost by allowing “Chargebacks” for services was never meant as a way for individual City’s to reduce local cash contributions nor was it meant has a way for Chargebacks to exceed actual cash contributions. However these last few Managers have decided to do just that!

Transportation wasn’t addressed in Ed Reform because the State used to fund reimbursements up to 80% in a separate line item in the State budget. Since 2008 that fund has not received money so the city included the transportation cost has part of the total cash contribution. Ed Reform never thought of that occurring.

In Governor Baker’s proposed 2019/2020 education budget Lowell would receive an additional $7.7 Million dollars for Lowell Public Schools in Chapt 70 funding while the City’s obligation increases from $47,400,845 to $49,626,890 or $2,226,045.

Based on history Manager /the City will provide less than 50% (somewhere around $600,000-$640,000) of their required $2,000,000 increase in Net School Spending in the form of additional cash contribution.

Increasing the total Cash contribution from $15,736,053 to $16,400,000 is still just slightly over the 33.5% of the Total Net School Spending since the City’s obligation also increased , leaving the same % being charged for services.

Because of the way the UTL contract was structured and because of “Step Increases” along with the raises for the Administrators, Clerks, Principals and non-union /contract staff the salary account for 2019/2020 will increase by over $5,000,000 this year. Health Insurance is expected to increase by 3% – 3.5% around $1,000,000 – Transportation will increase around $1,000,000, Out of district education for our most needing special needs students generally goes up 5% approximately another $500,000 – $600,000

The district also has mandates that must be followed but are not taken into account by the city or state. One example is how many Para’s are required per students in some if not all of our special need classes.

The previous Administration overspent the food service account and we “owe” the state $2,000,000 which has to be refunded by NOT Charging the account $500,000 in offsets over the next 4 years. The contractual obligations for Sick Leave buyback maybe $500,000 short this year and needed to be paid for in the next budget

Due to all of this and based on the funding that has been made public and what I project will be available the School Committee has no choice but to make cuts.

If the City increased their Cash contribution from 33.5 % to 42% that would provide the School System approx. an additional $4,464,094 which added in to the Chapt. 70 funding would prevent most if not all of these major cuts from being required.

I / We need the PARENTS of Lowell School Students and the many stakeholders and friends of education to contact the City Councilors and the City Manager and DEMAND they review and agree to a new fair Maintenance of Effort Agreement that provides the needed cash to maintain essential programs.

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