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Finance Committee Combs 2011-2012 District Budget

Details Budget Savings and Year-to-Year Progression

Mineola School District Finance Committee Spokesperson Doug Schumacher reported to the board of education the committee’s findings on the adopted 2011-2012 budget at the school district’s most recent meeting. Schumacher stated that the limitations on administration left little time for the six-member volunteer group who analyzes the district finances and the proposed budget every year.

The proposed budget for the next school year is $84,221,638 with a budget-to-budget increase of $4,093,065 (5.11 percent) and a tax levy increase of 2.37 ($74,798,377) percent. The current district budget is 80,128,573.

The district was aiming at decreasing the tax levy increase to 2.5 percent or lower for a fourth consecutive year without cutting programs. This budget will come before Mineola School District voters in May.

The 2011-12 budget includes the first year’s effect of the reconfiguration, which will generate return cost savings despite having to “require some non-recurring expenses up front, according to Schumacher. That savings is coming in light of significant state mandated increases to both the teachers’ and employees retirement systems (TRS, ERS). The current projects to the Hampton Street School and Meadow Drive School will be paid through the existing fund balance without raising taxes.

“Only by reducing staff several times during the last several years has the district kept the annual increase in its budget and its tax levy from growing as fast as payroll costs would have otherwise,” Schumacher said,

In the current budget, TRS accounts for 8.6 percent of payroll and is projected to increase to 11 percent in 2011-12. The ERS is set to jump to 16 percent from 11.5 percent in the current school budget. Costs for both are dictated by the state.

The district’s health insurance premiums, the carriers of which are set in union contracts, are also set to increase from 4.5 percent to 10 percent. From 2008 to 2012, 47.2 percent of the budget consisted of teacher salaries.

“We should emphasize that salaries and benefits are the major factors in the rate of increase,” Schumacher said.

According to district superintendent Dr. Michael Nagler, expenses for Mineola typically increase about 5 percent each year. “The only way you get a tax levy down is to cut out from the expense side,” he said. “There’s no more money coming in so you have to take out from the expense side.”

The planned reductions in staffing would offset much of the increase. Mineola is currently planning on a reduction of 19.2 full time positions, according to Schumacher’s presentation.

Not accounting the expected surplus of $1,258,000, the 2011-2012 “baseline” budget according to Schumacher in a budget “roll-forward” (summarizing current budget compared to next year) is $78,871,000. The finance committee estimated a total increase in salaries at $1.37 million, health insurance increases at $739,000 and TRS/ERS increases at $1.429 million.

In addition of $500,000 in staff not being supported by ARRA (American Recovery and Reinvestment Act), the 19.2 reduced positions reduces the budget by $2.32 million. Add on the renovations to Hampton Street and Meadow Drive, coupled with the district’s 99 percent spending plan adjustment, the current district budget is the end result.

“It’s prudent to plan to spend somewhere around 99 percent of your budget, or to describe that more harshly, to overbudget by 1 percent,” Schumacher said. “If your numbers are good, you have it left over at the end of the year and roll it over to next year. That’s what’s happening.”