How school budgets keep adding up

Posted 4/23/15

The numbers tell a story. Last week the school administration proposed a $166.6 million budget to the School Committee. It’s a number supported by a raft of other numbers that basically fall into …

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How school budgets keep adding up

Posted

The numbers tell a story. Last week the school administration proposed a $166.6 million budget to the School Committee. It’s a number supported by a raft of other numbers that basically fall into two categories: revenues and expenses. Those numbers in the two categories add up to the same to make for a balanced budget.

That’s what’s expected of the administration. It’s job is to look at the system, determine what is best for the education of the slightly more than 9,000 students in Warwick Public Schools and put together a balanced package that goes to the committee for its approval or revision and they, in turn, send on to the mayor and City Council.

In some respects what’s happening is no different than what City Department directors and the mayor are undertaking right now. Directors are presenting their projected needs for the new fiscal year, which the mayor reviews and most likely adjusts before presenting a city budget to the council.

The mayor’s budget will include a line item – a single appropriation – for schools. The city administration and the council do not have the power to tell schools where or how it should spend its money.

Here’s where the numbers tell a story.

At the conclusion of the budget cycle last June the council overrode the mayor’s veto of its school allocation, giving schools an added $400,000. The total school budget was $158.8 million with the city’s allocation of $119.4 million.

The difference between the two budgets is $7.8 million and the difference between what schools is asking taxpayers to underwrite – $119.4 million for the current year and $126.5 million for next year is $7 million.

But the school administration looks at it differently. It compares what it projects to spend to complete the current year with what it concludes is needed for next year. The difference is $3.4 million, not $7.8 million.

The mayor and council used to have a name for this – “Dooley Math” – so named for Robert Dooley who served as school finance director for more than 20 years before retiring.

How can schools be arguing it will spend $3.4 million more next year when it was appropriated $158.8 million last year and is asking for a total of $166.6 million now?

The answer is what happened in the current fiscal year.

City departments are expected to live by their budget appropriations. By and large that happens. The exceptions this year are expected to be the Department of Public Works snow removal budget that understandably ran higher than projected and Fire Department overtime that will remain a chronic problem until manning requirements are contractually changed.

At the end of the fiscal year, amounts are transferred between departments leaving the city with either a surplus or deficit.

Dooley math works differently.

Soon after approval of the school budget last year, the school administration learned that it would finish the prior year with a $3.9 million surplus, which is called a “carryover.”

If that happens on the city side of the budget, the money flows into an unrestricted reserve account often referred to as “the surplus.” Sometimes those funds are tapped to balance the next year’s budget.

Schools don’t have a reserve account. When they get a surplus, they turn around and spend it in the current fiscal year instead of saving it as a “rainy day fund.” Hence the $158.8 million budget approved last June has grown to $163.1 million.

Thus the school budget approved by the mayor and council is not always what it spends for the year. It’s a moving target.

Schools would go a long way to restoring taxpayer confidence if they spent what they were appropriated and put into a reserve account whatever surplus they generated. It’s time for some basic math.

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  • Justanidiot

    That's approximately $18,500 per student. Are we getting our money's worth?

    Friday, April 24, 2015 Report this

  • JohnStark

    Why would the Beacon think that those in charge of schools would know anything about basic math? Warwick schools are now spending about 50% more per student than full-time tuition at URI. Is the quality of instruction really that much better than that found in the engineering or pharmacy departments at URI? Of course not. The fact is that any entity run by government and poisoned by corresponding public sector unions will be costly, wasteful, inefficient, and ineffective. Only by bringing market forces to schools via vouchers will things change. Hence, it is no surprise that career educrats are deathly against ANY plan that would bring such genuine change.

    Sunday, April 26, 2015 Report this