Even though New York State has not officially enacted a 2 percent cap on property tax increase, Great Neck School District was scrupulous this year in working the budget for 2011-12 to keep within the 2 percent.
In fact, the budget is increasing by a 1.99 percent increase, a feat that would seem mathematically impossible given the pressure of unfunded mandates that were supposed to be lifted before a cap went into effect. The mandated contribution for pensions, alone, went up $4 million, while state aid to Great Neck is being cut, and the school population is continuing to increase. To stay within the 2 percent, the district had to find $5 million in cuts.
Not everyone (including me) greeted the news of such a small increase with unqualified joy. In fact, you would have expected more of those at the school board’s first public hearing on the proposed budget, on Monday, March 14, to have urged the administration not to forecast so tightly and cut so sharply – in effect, leaving no “wiggle” room for such things as a spike in energy costs, a natural disaster like last year’s microburst (which already spent down the district’s reserves), or reneging by the state on promised funding (like reimbursement for the MTA payroll tax).
Indeed, it was surprising that more of the district’s education boosters did not protest, as they did last year, when similar dire economic situation forcing the district to “cut to the bone” actually threatened to affect classroom instruction.
This time the cuts were made without affecting programming unlike districts across the country which are seeing their sports, music, arts, theater and anything that is not specifically mandated being slashed.
But the concern was that by doing what Nassau County school superintendents told state senators, led by state Sen. Jack Martins, was “mathematically impossible” without first getting relief from mandates, which cost the district $22 million this year, the district has contradicted their own claim, raised expectations among politicians and the community that the 2 percent cap is workable, and also set a base at a lower level that will forever be the base upon which future budgets are capped.
It is important to remind the community that unlike most districts around the state, which derive 35 percent to 40 percent of their school budgets from state aid, Great Neck will only receive 3.56 percent of its budget this year, and 3.4 percent for the 2011-12 budget. That means that Great Neck schools are overwhelmingly dependent on raising its revenue from property taxes, which fund 94.26 percent of the budget. The irony is that the state’s cut in aid hurts us less than the cap on property taxes.
Board of education members at the Monday meeting said they weighed long and hard the implications – and risks – of a minimal increase in the budget for all these reasons. In fact, most Nassau school districts, are expected to exceed the hypothetical (at this point) 2 percent cap. But their assessment was that many in our community are in financial distress, that the reason our school budgets pass with overwhelming support (with the percent of “yes” votes in the 80s) is because the community – which includes a significant proportion who do not have children in schools – trusts that the schools are not seeking a penny more in taxes than is absolutely needed. And anyone who attends the Saturday morning, line-by-line budget review, knows that to be true, that literally every penny is discussed and debated, in a process that is the best example of zero-based budgeting by a municipality anywhere.
School Board trustee Don Ashkenase, who is also a member of the finance committee, admitted the board and administration wrestled with the risks in slashing anything and everything that could be slashed this year, leaving little room to cut next year if the cap is in effect and mandatory pension contributions increase at the same rate, but in the end, decided that the economic plight of many in the community was significant.
This year, he said, they were able to keep within the 2 percent cap “without damaging the program, but we won’t have [the same latitude] next year, and if we face the same pressure of [mandated increases in contributions to] pension and health, we will really be between a rock and a hard place. It really worries me, the long-term implications.”
If the mandated contribution for pensions goes up at the same rate, that would force the district to find a further $5 million in cuts, “in order to have a chance at a 2 percent increase.”
In fact, the Board and administration recoiled at the notion that the administration not cut as much as they could this year, in order to have room to cut next year.
“This is an issue concerns us all. Great Neck schools going back as far as anyone can remember have enjoyed tremendous support,” said Trustee Lawrence Gross, a member of the finance committee, and the longest sitting school board member. “That comes because people respect what [we propose as the budget]. If we start to play games for $1 million, we would undercut the confidence, and do something we’ve never done before – It is hard to be in favor of that.”
So it is important to understand how the district was able to manage to keep to within the 2 percent cap this year – especially in the absence of mandate relief and why it will be hard to repeat this feat next year without cannibalizing what makes the Great Neck public school system, well, “great.”
The biggest savings came because 17 teachers retired – more than expected especially since the state didn’t offer a retirement incentive – on top of the 43 teachers who retired last year. These teachers at the top of the salary scale are replaced by teachers at the low-end of the salary scale (and a different tier for pension and benefits). This allows for a cut to the salary line of $796,000, but that is a one-shot – there won’t be that cut next year, in fact, salaries are likely to increase.
Also, SAGES, the collective bargaining unit for school administrators including principals, for the second year in a row, agreed to freeze salaries. Despite Gov. Cuomo’s vilification of the salaries that superintendents get – as if they are not deserving of six-figures when they manage the equivalent of a small city – it is not likely that administrators will go forever without any increase in salaries.
The district made reductions across the board – including in its allocations for security, supplies, contractual items, transportation, materials, noninstructional aides – but these are “fairly minor cuts, nibbling around the edges,” Great Neck Superintendent of Schools Tom Dolan said.
Principals agreed to small reduction in “index” money – that is, allocations to individual schools for such things as textbooks and supplies, based on student population. The cuts in the elementary schools, alone, amounted to $178,000.
Working with secondary school principals, the individual school buildings came up with $500,000 in programmatic reductions.
This is accomplished by “more careful scheduling,” which allowed the elimination of 1.2 full-time equivalent positions, which affects six classes between the two buildings; reduced teaching assistant hours at all four secondary schools, and reducing hourly teaching assignments. These changes resulted in total reductions of $296,859 in salaries and benefits.
“That’s a considerable amount when we will still be able to offer same program, even with a 1.99 percent budget,” Dolan said.
A key source of savings, $500,000, was the elimination of the “positive variance” in the budget.
Budgeting always involves guesstimating, especially since you are projecting more than a year in advance.
So budgeters typically use actual, year-to-date numbers, then give some projection of increases based on cost inflation and anticipated need, round-up, and if the best-case scenario works out, they might wind up with a budget surplus. This budget, though, uses “real hard numbers” – exact numbers – leaving no wiggle room at all, especially if there is a worst-case scenario.
“You can do that only once,” Dolan said.
In all, the number of students in K-12 in Great Neck’s public schools had been steadily rising since the 1990-1991 academic year (5,311, when state aid was at $7.4 million and covered 8.8 percent of the budget), and this year, numbers 6,352; next year, the projected enrollment will be 6,362 (2,477 in elementary and a greater number, 3,885, in secondary, where the cost of instruction is more expensive), plus another 39 students in other settings.
In addition, the district funds transportation, textbooks and other services for more than 1,500 Great Neck students who attend 73 parochial and private schools (a $3.2 million expenditure for transportation, alone, 25 percent of the total transportation budget of $11.9 million).
One area of mandate relief that school districts have been pleading for – and which seemed so obvious to school delegate Matthew Wigler, an 8th grader representing North Middle – is to be rid of the requirement to provide a seat on a bus for every student, rather than only those who actually use the school buses.
“What a big waste of money,” he exclaimed, “The majority don’t take bus.” School districts have also been looking to be allowed to cooperate on providing bus service for parochial and private school students out-of-district. But mandate relief does not seem to be on the horizon.
Despite year-after-year of “cut to the bone” budgets and rising enrollments, the most miraculous feat of all is that the district has managed to preserve low-class size.
Our district was able to preserve sports, music, art, theater, science research and all the things that make kids actually want to go to school.
This proposed budget has the support of the key groups, including United Parent Teacher Council and the Adult Education Advisory Committee. Adult Ed gets some 10,000 enrollments, including Basic
Adult Education programs that enable adults to earn their GED, programs which generate revenue but nonetheless, go into the total, $193,324,596 operating budget.
“One thing we are reassured about – for this [coming] year, I can’t speak beyond – when your kids come in [to school] their days will be the same,” said Board President Barbara Berkowitz. “These cuts were made with the principals who know their buildings, to keep the continuity of the day as close as possible for all the children. We kept cuts as far away as possible from the children.”
The irony is that despite the administration’s heroic efforts to keep the budget increase to less than 2 percent, by the time the property taxes are assessed, residential home owners can wind up seeing their property taxes rise more. That is because the continued shifting of base proportion (the amount that each class of taxpayer pays) on to the residential property owners, and because of tax certioraris, which lower the taxes for some, while shifting the gap to the rest.
It will be interesting to see if parents and others in the community come out to the Saturday, April 2, line-by line review that takes place at South High School (beginning at 9:30 a.m.). Nothing crystallizes the priorities and mission and vision of a school district than seeing how money is allocated.
That is followed by the official public hearing and adoption on Monday, April 12 at North Middle School (8 p.m.); then another hearing on Monday, May 9 (discussion only), and finally, the budget vote on Tuesday, May 17. (all the detail about the budget is at the district website, https://www.greatneck.k12.ny.us/).
