No Staff or Program Cuts Next Year in EG Schools; Surplus Funds Tapped to Cover $200k-Plus Funding Cut

The East Greenwich School Committee won’t be making cuts to staff or programming as a result of the Town Council’s vote for a $200,000 reduction of the district’s increase next year, school officials said this week.

Instead, the committee will tap into reserve funds to plug the hole while thinking about how to avoid a structural deficit and a repeat of the scenario in subsequent budget years.

School Committee Chairwoman Carolyn Mark thanked the many parents and supporters who came to the Town Council budget meeting last week to speak in support of the district and argue for a less significant reduction.

She also said the decision to use surplus funds to replace the $200,000 was “preferable to looking at programs and services [to cut].

“We did not want to have that conversation. It was a conversation that nobody wanted to have,” Mark said.

Still, “it raises the concern for me that we have the potential of running a structural deficit. . .I think this is a reasonable and balanced approach but [it’s a] concern I take with me into the next budget cycle.”

The district will recieve an increase of $795,000 next year, for a total of $33.3 million.

Emails before the council’s budget adoption meeting warned parents of significant cuts, such as the elimination of librarians, nurses, middle school music, maintenance projects and other items.

Town Council members noted the district has been tending $4 million in reserves. While rating agencies like to see communities maintain rainy day funds and operate in the black, Mark noted that there appears to be a disconnect between what the Town Council and district officials expect the school’s surplus to be on an annual operating basis as well as its different restricted fund balances.

The total reserve fund balance will decrease to from $3.89 to $3.59 million, said Gail Wilcox, director of administration.

Next years’ school budget already included $100,000 out of the fund, Wilcox said.

In total, the district will plug a total of $293,680 back into the budget. That’s the total amount the district needs to cover all that was cut during the entire budget process, Wilcox said, beginning with Town Manager Thomas E. Coyle III’s initial budget proposal that called for a $925,000 increase in the town’s annual appropriation to the district.

In April, the council asked for a $70,000 reduction, followed by the additional $200,000 in May.

To cover the $293,680, the money, according to a handout provided by Wilcox at this week’s School Committee meeting, will come from:

$60,000 - Committed Tech Fund Balance — Chromebooks

$99,140 - Restricted Educational Program Fund Balance, aka the rainy day fund

$59,142 - Restricted West Bay Collaborative Fund Balance

The West Bay fund stands at $1.1 million after the adjustment, which includes an additional $131,734 not anticipated in the current year.

The remaining $75,398 would be found through operating budget decreases in the net health and dental rate ($57,758), long term disability ($7,397) and new hire health and dental reduced from family to individual for one of the five anticipated new hires in the budget ($10,243).

The school district has recieved some criticism for tending to run annual surpluses or perhaps budgeting a bit conservatively, but Superintendent Victor Mercurio noted that it’s next to impossible to perfectly predict the future.

Mercurio said that at any time, the district could see multiple special education enrollments with significant support needs. That random event could add tens of thousands — if not hundreds of thousands — more dollars in cost to the district. On the other hand, the district could have a year in which medical claims are unexpectedly low and the district ends up with a surplus in the health account.

He did say that he felt confident that collaboration with the town could help synchronize both the town and school district’s expectations.

“This puts us where we need to be going forward,” Mercurio said of the plan to use surplus funds this year. To reconciling expectations: “I think with your confidence we can do this.”

Mark said that it’s clear that the Town Council “is interested in us assuming a little more risk in our budget process,” though “for many reasons, we have to balance the volatility inherent in any school district budget.

At the same time, “we need to put forth a budget that is acceptable to the Town Council,” Mark said. “That is going to be the work of the next six months — to get on the same page as the Town Council about what the assumptions are.”

A formal agenda item for the committee to authorize the budget adjustments is expected at its June 2 meeting.

The Town Council approved a $60.9 million budget for fiscal 2016 — an increase of $1.13 million. The tax increase would be 1.89 percent.

East Greenwich voters will have a chance to make last-minute changes to the budget at the town’s Financial Town Meeting on June 9, though it’s unlikely to happen — not enough voters have shown up to reach a quorum in years.