At the recommendation of Business Affairs Director Anthony Ferrucci, the School Committee voted Tuesday to adopt a revised budget for fiscal year 2012. In a presentation to the committee, Ferrucci projected an increase of $551,038 in revenues and expenses to the previously adopted $157.3 million budget to reflect a projected yearend FY 12 budget of $157.8 million. Since the increase in revenue and expenses offset, the budget remains balanced.
“I’m happy to say we still have a balanced budget for the year,” he said, adding that crafting and maintaining a budget for a department that has 1,500 employees is a difficult task, which is why he plans to keep the committee updated on budget matters through a series of reports throughout the year. “My goal is to adopt a balanced budget in the summer, then provide you with a report update in late November-early December, like this one, and a third report in March so we can see what costs we incurred during the winter.”
As part of that process, Ferrucci said when the initial budget was adopted in the summer, the department had to make some assumptions and estimates in anticipation of what would happen throughout the school year. For example, he said the department estimated there would be 25 teacher retirements and it took into account breakage, which is the difference in cost of the salary of the highest step teachers and the salary of the lower step teachers. Ferrucci said the department also anticipated the reduction of 50 staff members due to the new transportation contract outsourcing special education busing to First Student.
“We now know what our staff level is and we can fairly project costs for the school year,” he told the committee. “We can factor in the cost of the contract for First Student, which is planned to be fully operational when students return from Christmas break. We now know a lot of the major impacts.”
According to Ferrucci’s report, which can be found at the school department’s website at www.warwickpublicschools.org, two of the major revenue items are $370,983 in FY 11 state restricted set aside funds that were part of FY 11’s state aid allocation, which have been carried over into the FY 12 budget, and $65,000 in refunds and jobs grant funds “that have been confirmed to come in over budget.”
With regard to expenditures, Ferrucci said personnel costs are projected to come in $718,868 under budget and employee benefits are projected to come in $1,258,196 under budget but non-personnel costs are projected to come in $2,528,102 over budget.
According to the report, “The expenditure analysis includes all known and anticipated impacts regarding staffing both for the transition of outsourced transportation services and the implementation of the new bargaining agreements.”
“The significant reduction of personnel expenses and the significant increase in other non-personnel cost is primarily attributed to the recognition of our transition from an in-house transportation department that is staffed by employees to services being provided by an outside vendor that is accounted for in other purchase services, a non-personnel cost,” the report continues.
Ferrucci said the transportation contract that outsources special education busing to First Student yields a positive variance of $1,460,000, which is offset by staff cost reductions. Outside of the transition of transportation, other expenditure items include: $90,000 for contracted nurse service to meet student needs; $240,000 in tuition payments for actual and anticipated out-of-district special education services; $48,000 in charter school tuition payments; $170,000 for needed supplies; $60,000 in building improvements throughout the district; $85,000 in technology hardware costs; and $250,000 in technology software costs, $120,000 of which will be used for the establishment and maintenance of a Point of Sale system for the school lunch program to better track students and attract more students who qualify to take advantage of the free and reduced lunch program, which factors into the formula that determines how much state aid the district receives.
Ferrucci said increases in technology hardware and software are partially offset by the carryover of set aside funds from the FY 11 budget. He said of the $1.1 million designated for technology licensing fees, only $100,000 is available for the replacement of computers and repairs or replacement of parts to existing computers – $50,000 to purchase 45 new computers and $50,000 for repairs and part replacements.
With 3,200 computers in the district, Ferrucci said it would take 80 years to replace all of them if only 45 are replaced each time.
Maloney said the $1 million in license fees could be used to purchase 3,000 new computers each year. He said many of the basic programs the district pays license fees for, such as Microsoft Word and Excel, come with Google Apps, which each student should have access to already.
John Kennedy, who spoke during public comment, suggested taking half of the technology licensing fee line item and using that money to update existing computers every three years.
Addressing charter schools, Ferrucci said he misspoke during an earlier interview with the Beacon when he said the district currently has 12 students attending charter schools. At Tuesday’s meeting, Ferrucci corrected himself and said the district currently has 33 students attending charter schools. At a cost of $9,300 per pupil, it’s costing the school department $307,000 in tuition payments for those students. In addition, the district loses $3,300 per pupil in state aid, which follows the student and goes to the charter school instead of Warwick Public Schools. For 33 students, the district is losing $109,000 in state aid it would otherwise receive if those students attended schools in the district.
“We’re losing a total of $417,000 in resources to accommodate students leaving the district to attend charter schools,” Ferrucci said.
Taking that one step further, if the proposed Providence Mayoral Academies, which would draw students from Providence, North Providence, Cranston and Warwick, are approved and 20 percent of the academy is made up by Warwick students, as projected, Ferrucci said the district has the potential to lose an additional $2.3 million per year.
“We don’t have the ability to account for that in terms of savings,” said Committee vice chairman Patrick Maloney.
Committee member Eugene Nadeau said he doesn’t believe the projections are accurate.
“I believe the majority, about 80 percent, will come from Providence,” he said. “I don’t think parents will want their kids bused to that extent. I hope it doesn’t happen.”
Superintendent Dr. Peter Horoschak said he and Maloney attended hearings on the proposed academies held last week and voiced Warwick’s opposition to them. He said they were informed that anyone else who wishes to object to the academies, through a petition or letter, must be sent to the Board of Regents Office at the Rhode Island Department of Education by Dec. 30. The Board is scheduled to vote on approval of the academies in January.
Kennedy questioned why students are currently attending charter schools.
“Are we lacking something here that they can get somewhere else?” he asked.
“The decision to attend a charter school is an individual family decision,” Horoschak responded.
Although the committee approved a balanced revised budget, Maloney said it was important to point out that it’s only balanced because the district is not doing things that need to be done, such as fire code upgrades and other building maintenance needs, such as repairing roofs; neither of which has been included in the budget.
“We’re showing a balanced budget because that’s what the state and the law say we must do, but we have a lot of obligations that are not being met,” he said.
When asked if the committee plans to continue pursuing its lawsuit against the city over the $6.2 million it was cut in local support, which the department argues is part of the city’s maintenance of effort to properly fund schools, Rosemary Healey, director of human resources and legal counsel for the committee, confirmed it was.
Referring to comments from Mayor Scott Avedisian that the school department should drop the suit against the city since it realized a surplus last fiscal year and has achieved a balanced budget for this year, Robert Bushell, director of elementary education, said, “The mayor’s comments prompted us to look at our priorities; we may have a balanced budget, but we’re not doing what we need to do to meet the B.E.P. [Basic Education Plan] – there’s a lot we’re not doing. The list is overwhelming in dollars but underwhelming in what we’re doing for our students and what we need to be doing.”
In other committee news, Maloney said the committee plans to draft a resolution seeking to obtain waivers on some of the permit fees the school department incurs from the city for building upgrades and other construction work.
While approving bids and change orders for work that’s already been completed, the committee learned the permit fees could have been reduced if the projects were combined on one bid, but because the projects had to be bid separately, a permit was required for each one. In this case, the fees amounted to $17,000.
“So let me get this straight … the city owns the buildings. We maintain the buildings, which means the school department incurs the cost of $17,000 in permit fees, which the city requires and charges the school department for work on buildings that the city owns?!” shouted committee member Terri Medeiros. “That’s ludicrous!”
The committee’s next scheduled meeting is for Tuesday, January 9, 2012. A time and location has not yet been determined.