(The following letter was presented to the Manhasset Board of Education at its Public Session Meeting held on Thursday, January 8, 2004.)

The Citizens Advisory Committee for Finance has been at work since August of this year to fulfill the charge given by the Board of Education to create three distinct subcommittees to investigate and report upon the areas of per pupil costs, long range planning and the teachers' contract. We expect to forward the subcommittee report on the teachers' contract to you before the end of the year under separate cover, and attached please find the reports of the CAC's subcommittees for Per Pupil Costs and Long Range Planning. The reports are based on the best available information and should be updated and refined on a regular ongoing basis. Included with each report are the recommendations made by each subcommittee of the CAC that deserve the board's serious consideration.

As you review the Per Pupil Costs subcommittee's findings, please note some critical recommendations that require immediate attention:

• Total compensation levels (salaries and benefits) for employees of the district cannot continue to grow as they have in recent years. Continued growth in total compensation coupled with student population growth and bond-financing costs will result in double-digit annual increases in the district's budget. We feel that the community will not support annual increases of this magnitude. Thus, moving forward. The upcoming contract negotiations become all the more important to address. Similarly, the number of staff members cannot continue to grow as in the past. Staffing levels need to be reviewed periodically to ensure that the district is retaining only those employees necessary for the proper education of the students.

• The board should look closely at ways to either increase revenues on activities that are not considered "core" curriculum or to decrease the breadth of activities currently being offered. While our District is extremely fortunate to have such a rich schedule of varied and enhanced courses and activities, it is not at all clear that the District can afford to continue this rich variety of offerings without having alternative sources of funding in place.

The Long Range Subcommittee postulated various scenarios and assumed realistic average increases in utility costs, benefits and BOCES. If we also assume, unrealistically, that salaries

do not increase at all in the next 5 years and that no new debt is issued, the average annual

increase in the budget over the next 5 years would still be 5.6 percent. We feel the rate of budget growth including salary increases and additional debt would be unacceptable to the community.

The resounding message is the need to rein in and exert control over the district's level of spending. Our community is confronted with a number of issues that make action more urgent. Some of these issues include:

1. A relatively high level of spending in the district

2. Reassessment in Nassau County which has put a lot of pressure on the taxpayers

3. Increasing enrollment which is straining the capacity of our facilities.

4. The need to refurbish and expand present facilities

5. Inadequate transportation facilities and an aged bus fleet and attendant inefficiencies

6. Increased costs for mandated Retirement System and health insurance expenses

The board needs to address these critical issues facing the district while maintaining great restraint on the overall level of spending. In recent years it has appeared that the board has not acted on recommendations from the Administration and from independent consultants on a variety of actions that would result in cost savings. The board needs to balance the current financial and political realities with the desire to provide the highest level of educational programming for our children. The board should direct the Administration to implement a plan to achieve this necessary balance. The CAC strongly advocates capping the level of total district spending during the next few years. We recommend that the cap not exceed the rate of inflation and should include a formula to account for increased student population. The issue of spending by the district needs to be brought under the board's control, rather than having the costs and programs dictate the board's actions.

The CAC recognizes and endorses spending for necessary capital and cost-saving improvements that have either been ignored or were removed from prior bond issues. Decaying facilities, aging systems, and overcrowding are issues that detract from the education of the students that the district serves. For these reasons the committee is extremely concerned about the timing of the vote on the proposed bond referendum. We recommend that the Board strongly consider delaying the proposed bond referendum in order to take time to more accurately identify and to fully advocate for the children's overall short- term and long-term needs. The BOE needs to methodically and rigorously defend its proposed course of action, thereby capturing support from a greater sector of the community. The Committee also feels that the resulting increases in operating expenses after the proposed referendum have not been examined in full.

The committee stands ready to assist the board and administration in finding solutions to these difficult issues. We would like to formally present these reports to you at your board meeting on Thursday, Jan. 8. Please include these matters on your agenda for that evening.

Respectfully yours,

The Members of the Citizens Advisory Committee for Finance

Mark Aloia, Larry Belinsky (chair), Jill Brogan, William D'Antonio, Mimi Donohue
David Hilpl, Joseph Leonardi, David Lewinson, William Lyons, Elaine Phillips
Joanne Piluso, Carlo Prinzo, Regina Rule, Jane Sessler, Victor Simonte, William Sinclair, Frank Trotti, Ashok Vora, Kathleen Ward

Lead Board of Education Liaison: Thomas Maimone

Board of Education Liaison Teacher Contract Analysis Subcommittee: Cindy Cardinal

Board of Education Liaison Per Pupil Costs Subcommittee: Reuben Cohen

Staff Liaison: Stanley Germain