The Highland Central School District’s proposed budget of $41.66 million failed to win voter approval on May 17, leaving the district facing two alternatives going forward: either try again, putting the same exact budget up for a vote a second time, or re-tool the numbers and present a trimmer budget.
At a special meeting on Tuesday, May 31, Highland’s Board of Education voted 6-0 — board trustee Mike Bakatsias was absent — to put a leaner budget of $41,522,885 up for a vote on Tuesday, June 21.
Had this been a typical year, the first budget would have passed on May 17, garnering 728 “yes” votes and 568 “no” votes. But getting the approval of 56 percent of the voters was not enough this time around; the budget that reflected a 1.987 percent tax levy increase required a supermajority 60 percent voter approval rate to pass.
While that 1.987 percent increase in the tax levy would seem to satisfy the “two-percent tax cap” legislation — a requirement for the budget to pass with a simple 50-percent-plus-one majority — the “two-percent” figure is actually a bit of a misnomer. A district’s actual tax levy is determined by a complex formula that includes calculating in the Consumer Price Index (CPI). With the CPI relatively flat this year, the Highland district found itself with a negative tax levy, requiring a 60 percent voter approval.
Highland was one of 80 districts statewide that faced this challenge when putting forth budgets for a vote in May. The New Paltz Central School District was in the same predicament, but they passed a $57 million budget with 77.8 percent voter approval, surpassing the necessary 60 percent majority by a generous margin. In Highland, they came up just 50 votes short.
In debating the matter during the annual budget development discussions conducted earlier this year, the Highland district’s BOE elected to push the limits of the tax cap and try for a budget that required a supermajority vote because they felt the alternative — cutting student programs — was unacceptable.
The new reduced budget of $41,522,885 reflects a tax levy increase of .5861 percent, bringing it in at just under the .59 percent increase allowable in Highland without having to resort to supermajority voter approval. The trimmed-down budget will pass if it receives a simple majority vote.
The new budget eliminates $133,211 allotted in the first budget for salaries to fill three full-time positions made available by retirement: a teaching position at the elementary school, a physical education teacher at the middle school and a teaching assistant position. (There is also a vacant custodial position that will not be filled, but that was already accounted for in the first budget.) The district is asking for volunteers among existing staff to cover the workload left by the vacancies.
The $133,211 would have covered the salaries for three first-year employees. The retiring positions actually cost the district more than that amount, but since the district was aware when developing the budget that the employees would be retiring at the end of the school year, the numbers for their replacement had already been factored in.
An additional challenge the Highland district faced in budget development this year was an increase in the costs of mandated (and necessary) special education services, which rose from $822,000 this year to $1,047,000 for 2016-17. The costs for the BOCES budget of $1,135,000 this year also went up, to $1,425,000.
The budget voters will decide on now reflects an increase of 2.5 percent over the 2015-16 total budget (the first budget on May 17 came in at a 2.8 percent increase). It calls for a tax levy of $26,051,044, which according to the district’s business administrator Louise Lynch, will cost taxpayers with a home assessed at $200,000 an additional $26 per year over what they pay now. The budget will be balanced by applying an employee benefit accrual of $300,000, and the $900,000 typically transferred from the fund balance account reserves will be increased to $1,219,716. State aid brings in $13,454,490 and the district receives $497,635 from other sources including PILOTS, interest and penalties.
And schools Superintendent Deborah Haab is continuing to lobby local legislators for additional state aid. The Highland district received $100,000 in supplementary state aid in each of the past two years from state Assemblyman Frank Skartados and $50,000 from state Sen. George Amedore for the 2015-16 year. Haab is currently seeking $300,000 for the district from Skartados and Amedore.
The Gap Elimination Adjustment (GEA) legislation — enacted to balance a state budget deficit seven years ago by using funds that would have gone to the schools — has ended, restoring $711,610 in funding this year to Highland. (The district maintains it lost more than $8.5 million during the years the legislation was in place, however; funds that will never be recovered.) And the formula to determine Highland’s basic Foundation Aid is still frozen, resulting in the district receiving just $17,000 in Foundation Aid this year rather than the $2 million it would have received had the formula been restored.
If the revote fails to pass, the district will be required to adopt a contingency budget that will not permit any increase in the tax levy, resulting in further reductions. More significantly, perhaps, a contingency budget funds only teacher salaries and “ordinary” expenses to ensure the health and safety of students. Having to resort to a contingency budget brings with it restrictions from the state that prohibit the district from performing any “nonessential” maintenance or purchasing any equipment for the schools and forbids the free use of facilities and grounds by community groups.
Currently the school’s facilities are available to use free of charge during off-hours by recognized civic, social, fraternal and religious organizations (the latter may use the facilities only for non-religious activities, like a basketball game.) If a contingency budget has to be adopted, school-sponsored teams and clubs will still be able to use the facilities at no cost, but everyone else will have to pay. A quick glance at a single week on the school’s facilities-use calendar shows the wide range of organizations that utilize Highland’s school facilities, from the YMCA to the Babe Ruth League, from Pack 70 Cub Scouts to Brownie Troop 60093, to boys’ AAU Basketball and the 20th Century Limited Drum and Bugle Corps.
The vote on June 21 will be for the budget only; the bus replacement proposition on May 17 passed with 704 “yes” votes to 597 “no” votes, achieving the simple majority voter approval rate it required. The district will purchase seven 65-passenger buses, one 29-passenger vehicle and one eight-passenger van at a cost of $937,803, with almost 60 percent of the cost covered by state transportation aid. The remaining $383,561 will be funded through local taxes, an impact that will not be felt by taxpayers until the 2017-18 budget, when it will add a maximum of $6 per year (for five years) per $100,000 of assessed home value.
Trustees Tom Miller and Sue Gilmore were reelected in May to their seats on the Board of Education for a third three-year term each, beginning July 1. The new vote will not affect their election.
A public hearing will be held on the budget Tuesday, June 14 at 6 p.m. at the high school, prior to the regular open board meeting at 7 p.m. More information is available at www.highland-k12.org.