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Superintendent Presents 2011-12 Preliminary School Budget

Proposal Calls for 2.71 Percent Tax Levy Increase

Spring hasn’t arrived yet, but the school budget season has. Superintendent of Garden City Schools Dr. Robert Feirsen held the first in a series of school budget presentations for the 2011/12 academic year. The proposal includes an overall budget of $101,117,058, with a budget-to-budget increase of $3,128,568 or 3.19 percent. The projected tax levy increase (with STAR) is 2.71 percent.

This year’s overview and revenue projections were clearly influenced by the current fiscal climate, NYS projections for state aid, pension, health insurance and other mandates, according to Dr. Feirsen. “This is called the superintendent’s budget because it hasn’t been touched by the board of education. It is really what I have prepared for the board. There are citizens’ comments that we encourage and respond to over the next several weeks. We encourage participation from organized parent groups in the community and, ultimately the board will adopt a budget that will be presented to the voters,” Feirsen said.

According to Dr. Feirsen, the budget is defined as “what provides the resources to achieve our goals.” As it stated in the presentation, the budget design principles include ensuring health and safety and provide funds to maintain the physical plant; provide allocations to address laws, mandates and contractual obligations; and reduce potential for tax spikes by maintaining sound level of appropriated fund balance as well as money for contingencies. It also is created to “maintain reserves to every extent feasible” and “respect that property taxes from individual homeowners remain the major source of revenue for the budget.”

When describing the budget process, Dr. Feirsen explained how he arrived at the specific proposals. “The recommendations I am giving the board in turn just didn’t materialize out of nothing,” he said. “We go through a rather lengthy process, almost as soon as school starts in the fall, of looking at our expenditures and looking at the big picture and working with principals and other budget directors and every recommendation has the approval, consent and support of the entire administrative team,” Feirsen said.

The superintendent also emphasized that the challenges to this year’s budget are a result of the fact that federal ARRA funding, which the state used to make up for cuts during the past two years, is ending this month. “We’re always under pressure to conserve our resources and use them as prudently as possible. This year, and I’ve said over the past several years, we have some increasing challenges. This year is perhaps the most challenging of all,” Feirsen said.

In addition, another challenge is that significant state aid reductions were recently proposed by Governor Cuomo in his 2011-2012 executive budget. “It’s not just a Garden City problem. It is a regional issue. For example, we send much more to the state then we get back. Nassau [County] as a whole is scheduled to get a 10.1 percent reduction in state aid as opposed to a state-wide average of 7.4 percent. The governor’s proposal in particular decreases our aid by 13.61 percent,” he said.

Foundation Aid, which is the basic aid that all school districts receive, also remains frozen. Feirsen noted that regardless of whether or not the school district’s needs change, there is no change in the basic allocation for state aid. “I’m very weary of a proposal contained in the fine print of the governor’s budget recommendations to change the way special education aid is dispensed. And even though the governor rode into town on the horse that said ‘mandate relief, mandate relief, that’s the way to deal with these budget issues,’ there is no mandate relief specified in the governor’s proposal,” Feirsen added.

Among one of the most costly drivers in the budget is rising pension hikes. By law, the school district must contribute to NYS pension funds for all employees; health care increases; and special education costs. Special education reimbursement levels from the federal and state governments have never approached promised rates, according to the district.

Also, another factor affecting the budget is cost shifting from local governments to school districts. “The various levels of government attempt to make their budgets look better by shifting costs onto school districts and sometimes other municipalities because we are the last in line. There’s nobody we can turn to after us and say, now we got hit with this, now some other agency can take the hit... We’re the end of the road,” Feirsen said.

Rising fuel and energy costs and a new water tax set by the county are significant cost drivers. Should the budget not be passed on time, the school district will not know how much money to allocate for state aid. This is also the first year the district must pay on the 2009 school investment bond and those payments are included in the budget numbers.

On the revenue side, interest rates remain miniscule, according to Feirsen. “We’re not generating a lot of interest income and we’re inhibited from investing in wildly speculative instruments,” he said.

Dr. Feirsen informed residents that the administration looked at every budget code and examined every way they spend their funds. “What we tried to do is create a balance, a balance between achieving the district’s mission and addressing the expectations of our community to maintain that level of excellence and to retain that level of high performance that we’ve become known for and that is the reason people come here, and, at that same time, developing a budget that the community could support because it shows an attempt to control expenditures and a recognition of the burden on taxpayers,” he said.

In order to control such expenditures, Feirsen recommended using the remaining $300,000 in federal ARRA money. As a means to offset cost increases, he also proposed using the district’s reserve funds. “That’s why we have reserves. We have reserves for just these kinds of situations. And, as the governor recommended, we are using them. We’re not using all of it because once you use it up, you don’t have anymore, and then you don’t have any reserves. Then you have nothing to fall back upon except to go back to the community and say we have nothing left in the tank, we need extra money now.” Feirsen added that one of the budget’s biggest costs are personnel costs and the budget does contain personnel cuts, which will be addressed in future budget sessions.

Assistant Superintendent for Business and Finance Albert Chase explained that the district is taking money from reserves and putting them back in the budget. “We put them away for the express purpose if the time came when we needed them, we would take them and use them gradually,” Chase said.

Several members of the board of education asked the superintendent questions about using reserve funds to offset pension obligations. Board Trustee Angela Heineman likened it to robbing Peter to pay Paul in a way. “Effectively, you’re taking in new money, and using up old… and using new money to replace it,” she said.

School Board President Colleen Foley commented that throughout her tenure on the board, she has heard residents ask why the district doesn’t use the reserves more often. “So now we are using them and the strategy for that is to use them now when we need them, as opposed to four years ago, when we held the line,” Foley said.

Feirsen agreed, “And that’s what the board said at those points, that’s what we said at those points, that this makes sense. When you’re able to do it, put money away for that difficult situation,” Feirsen said. “Folks, we’ve arrived at the difficult situation,” he added.

Residents will vote on the budget on May 17. For a complete budget calendar, visit the district’s website at www.garden city.k12.ny.us.