Smithtown Central School District (SCSD) does a good job educating its students; it is something of which we can be proud. But there is a very big crack in the system that needs fixing now!
NYS is in a difficult financial situation, people leaving has resulted in the loss of 3 Congressional seats after the 2010 census. The birth-rate is declining. Businesses are struggling, unemployment is high, and home sales are sluggish, with a 2 year inventory of unsold homes in Nassau and Suffolk. Taxes are being grieved.
NYS is contributing 16.31% less than last year in school aid for SCSD. We learned that for the '11-12 year we will have a shortfall of $5 million from the state--that's on top of last year when we were cut by $3.5 million! At the same time, we were told to expect an increase of at least $7 million in payments we must make for retirement pensions and benefits this year alone. [The amount is being questioned.] In addition to increases in fuel, salaries, and more, we have to find about $12 million (give or take) more.
In the last couple years, the school tax increase has been low, before that, the average increase was around 7% per year. Every year there has been a 'capture' of money 'left over' that are called reserves. This amount can range from $3 to $10 million. It is, essentially, money we are over-taxed that is kept by the SCSD. In 2005, a year we had a contingent budget, meaning that taxpayers voted down the proposed budget and we went to a pared down budget, we had about $6 million in reserves! How did that happen?
There is nothing wrong with carrying a percentage of the budget in reserves--the state lets us keep 4% on hand--like a rainy day fund. We actually have several reserve funds with a total of about $48 million. Some reserves are dedicated to fund to a particular action and may not be used for anything else. One use for a reserve fund is to pay it toward the next year's tax bill--we did and that is why our recent tax increases were so low.
Our school budget is being thrashed out right now, as the Administration proposes and the Board gives direction. Already, the district has been in turmoil over the possibility of 1. changing the walker area, 2. issuing a referendum to change private and parochial school student busing, 3. a referendum to change SCSD busing, and 4. the proposed closing of one elementary school which would only save about $340,000.
The Administration has discussed raising class size as a means to save some money. Unfortunately, even though we have elementary classes with 17 and 18 students, their model didn't produce much more that $1 million in savings.
Last year the district made some changes that we applaud that saved money: buses made to carry 66 passengers had been loaded with 12-15 students--no more, High School electives without an enrollment of at least 15 students are not run, and after-school athletic program teams were combined, creating savings.
If the governor's proposed tax cap goes through, and it is believed it will, we will be limited to a 2% increase a year. And that is where the problem lies. Some would like to tax us by, maybe, 12%, and use the 'excess' money for future years to ease the burden. Others want to see big cuts NOW, as they will surely need to be more cuts made around the corner.
Why do we say this? Contributions we make to pay pension and benefits for TRS (teachers) and ERS (other employees) in 2003-04 were $1,161,857. and eight years later in '11-12 it is projected we will pay $11,621,929. Pension, benefits, and salary eat up 78% of our budget this year--it will be greater, next year. In fact, these bills will increase exponentially. We can't afford the contracts we are in, and we can't afford the current retirement system.
Negotiate a package that is good for teachers and for the district.
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