With its $161.9 million budget proposal the school administration aims to reduce future interest expenses by about $250,000 while ensuring a revenue stream from the taxpayers of $10 million over the next three years to complete required school fire code improvements.
So far it’s a plan that isn’t understood by the city administration or City Council and is coming under question by School Committee members.
In marked contrast to prior years when Scott Avedisian flatly rejected any request to increase school spending, the mayor reserved comment on the school budget Tuesday. Overall, the budget calls for a $5.9 million increase in city funding.
Members of the City Council had issues with the amount and the fact they don’t have copies of the document.
“I haven’t got a hard copy of it yet,” protested City Council President Bruce Place (D-Ward 2).
He’s not alone. Other council members weren’t issued copies either in keeping with the school administration’s decision to make the document available online and save printing costs.
“I’ll be looking at it,” Place assured.
Ward 4 Councilman Joseph Solomon hasn’t gotten into budget details, but he’s reached a conclusion on the proposed increase in spending.
“We all know that’s impossible to achieve. There’s no more money in the bank,” he said.
When told of the plan to fund fire code improvements, Place questioned whether those requirements were resulting from stricter codes since The Station nightclub fire that might be relaxed by the legislature. He said he wants to see what the General Assembly will do.
“Relax the stringent fire codes. They [legislators] should rush that through,” says School Committee member Eugene Nadeau.Fellow committee member Patrick Maloney wants to see the fire code improvements funded with unspent bond money as well as cut another $1.5 million from the budget.“These taxpayers can’t pay anymore,” he said, “and I’m not going to ask them to do it.”
School business officer Anthony Ferrucci offered an overview of the budget Tuesday, explaining that in addition to the funding of fire code requirements, the request for additional city funding would offset a structural deficit created by the use of a $2 million surplus to balance the current budget; $1 million in new textbooks; $800,000 in building costs and another $800,000 in technology equipment and user fee costs.
Fire code upgrades at $3.3 million is the biggest chunk.
Collectively, this adds up to about $7 million. However, based on the governor’s budget, which calls for an increase in school funds and a small surplus, Ferrucci projects the department will see $1 million in new revenues. That reduces the demand for added city funding to $5.9 million.
It’s the fire piece that has sparked debate.
Of $8 million the department borrowed several years ago to make building repairs, including a new Pilgrim roof, $3.5 million remains in the account. Schools are paying principal and interest costs on the money.
What the school administration proposes is rather than use the $3.5 million, thereby saving an estimated $250,000 in interest expenses over 10 years that taxpayers come up with the money.
That’s part of the picture.
The department has a three-year plan to address school fire codes, making improvements to as many as 10 schools each summer. The issue is that for the work to start in June and be done in September, the department must line up contracts before it has a budget for the upcoming fiscal year. It has no guarantee of getting the money.
But if taxpayers fund it as part of the schools’ operating budget, the amount would be included in the “maintenance of effort,” or the base the community would be expected to underwrite the next fiscal year. In such a manner, the 3-year plan costing a projected $10 million would be assured.
“If not this way,” Ferrucci asks, “how do we make the commitment to construction in 2013?” He said the mechanism “provides certainty” albeit at the taxpayers’ expense.
Looking at the current year, Nadeau favors reducing the requested amount in city funding by $3.3 million and using the bonded funds for fire code upgrades. Maloney would do the same thing.
Nadeau he agrees with Ferrucci that schools should make upgrades with operating funds, he can’t see doing it in this instance because of the pressure it puts on taxpayers.
“As long as we have the money available, let’s use that up,” he said.
Echoing Nadeau, fellow committee member Christopher Friel said, “I don’t think we should be asking for $3.3 million [from the city] when we have bond money available this year.”
Friel said the recommended FY 2013 budget is “pretty much a straight budget from last year,” adding that the salary and benefits portion, which makes up 85 percent of the budget, is approximately $400,000 less.
“I don’t see the logic,” Friel said yesterday. He noted that school would borrow the $3.5 million at a “very low rate,” adding that when those funds are depleted the department can appeal to the city for to fund the second and third year of the program.
The committee is slated to vote on the budget this coming Tuesday.