The Mattituck-Cutchogue School District has found itself in an uncommon situation when it comes to preparing its spending plan for next year. Last May, voters approved a $39.6 million budget for the 2014-15 school year. In September, however, that budget was increased to $40,124,885 — without any impact on taxpayers.
The change occurred because the district ended up a year-end surplus of $450,000 from the 2013-14 budget, district business administrator Michael Engelhardt said last Thursday.
Mr. Engelhardt explained that most of the surplus resulted from several unexpected teacher retirements. There was also a reduction in teacher retirement benefits, which has affected schools statewide.
“We chose to pay off debt principal for 2014-15,” Mr. Engelhardt said, explaining how the district used the surplus funds. “It shortened the debt schedule by four years and lowered the annual interest payment.”
If $450,000 had not been added to the current year’s budget, the district’s budget proposal for next year would have reflected a 1 percent increase, he said. Instead, the district has been able to put together a budget that’s lower. The 2015-16 budget proposal calls for spending of $40,116,062, which represents a year-to-year decrease of $8,824, or .02 percent.
But if the proposed spending amount is dropping, why is the district also asking for an increase of 1.66 percent — or $590,000 — in the 2015-16 tax levy?
The reason, Mr. Engelhardt said, is a projected loss in revenue.
“The assessed values [of properties] have moved down,” he said, which “requires that the tax rate go up a little bit to balance it off.”
Mr. Engelhardt also noted that revenue from out-of-district student tuition is expected to drop next year, since some of those students are graduating.
During a budget workshop held before last Thursday’s school board meeting, Superintendent Anne Smith estimated that the tax increase for 2015-16 would cost the average homeowner between $63 and $79 more. After she described the current draft budget as “still a work in progress,” school board members discussed applying other available savings to offset taxes.
Under the state-mandated tax cap, the district could present a budget carrying a 2.4 percent increase in the tax levy without needing 60 percent voter approval. Instead, its proposed increase in the levy is $264,000 below the tax cap, according to Dr. Smith’s presentation.
As for state aid, Dr. Smith said the draft budget doesn’t incorporate any increases.
“We’re assuming we’re going to at least get what we got last year,” she said. “At this point, we’re not adhering to the governor’s recommendation to assume a 1.7 percent increase until we see that is real.”
When asked for comment, Gov. Andrew Cuomo’s office sent a transcript of a statement he made during a Feb. 25 cabinet meeting.
In it, Mr. Cuomo said schools shouldn’t have trouble preparing their budgets and claimed they were made aware two years ago of the 1.7 percent increase planned for 2015-16.
“The education budget is a two-year budget as opposed to an annual budget,” the statement reads. “It’s one of the few exceptions in the state budget. Most of the agency budgets are year-to-year.”
Mr. Cuomo also said he’s putting forward two different versions of his budget proposal: one with a 1.7 percent increase in state aid and another with a 4.5 percent hike, which is contingent upon the Legislature’s passage of his proposed education reforms. These include a teacher rating system that would base 50 percent of an instructor’s evaluation on student performance on state tests — up from the current 20 percent.
The governor has said the reforms are needed because many students continue to “lag behind in performance” despite the fact that less than 1 percent of teachers statewide were rated ineffective last year.
“There is a chance that if we pass a reform package, the budget goes up to 4.5 percent,” Mr. Cuomo’s statement read. “And that would be great and a windfall for education in this state, but the number they were given to plan was the 1.7 percent.
“If they want to be risky and think about what they would do if it was 4.5 percent, they could do that also,” the statement continued.
As for the district’s projected enrollment for next year, Dr. Smith predicts that Cutchogue East Elementary School will remain close to its current 564 students. Total enrollment for grades 7 through 12 is expected to drop slightly to 677 students.
Dr. Smith said the bulk of that decrease is expected to affect seventh and eighth grades, where enrollment is projected to drop from 220 students to 177.
School board president Jerry Diffley said he believes the district should look at staff reductions in those grades.
“I don’t know if we can stay the status quo,” Mr. Diffley said. “We’ve got to look at that.”
Trustee Bill Gatz agreed.
“It’s nice to offer all of these things, but you only have so many kids to fill those buckets,” he said. “If you only have three or four kids [in a course], that becomes rather expensive.”
Dr. Smith said she’s looking into the district’s options, like redesigning courses and reducing some positions to part-time.
“At this point, I’d rather see the staff assigned to support more students in creative ways instead of collapsing down and keeping class sizes so high,” she said.
The school board has scheduled an April 2 budget workshop and is expected to adopt the budget by April 16.
Editor’s note: An initial version of this story published at suffolktimes.com Monday morning was replaced online Monday afternoon with an updated story, which will also appear in Thursday’s edition of The Suffolk Times newspaper.