School aid cuts will cause tax hikes — even with reserves drained

BARBARAELLEN KOCH FILE PHOTO | Riverhead's Pulaski Street School.
BARBARAELLEN KOCH FILE PHOTO | Riverhead's Pulaski Street School.

Get ready for a healthy school tax hike.

Spending in the Riverhead School District would increase by 3.28 percent, or more than $3 million, under superintendent Nancy Carney’s proposed $111.8 million 2011-12 school year budget, a draft of which she unveiled at Tuesday night’s school board meeting. But the tax levy — the amount of cash the district collects from taxpayers — would go up 5.7 percent for 2011-12, which is $5.2 million.

That’s because Governor Andrew Cuomo has proposed cutting $2.9 million, 16 percent, in state aid to the Riverhead district, causing administrators to plan for the worst, school officials said.

School districts also won’t be receiving federal stimulus funds in the 2011-12 year, which had been the case this school year, during which Riverhead received $750,952 in stimulus funds.

The governor’s proposal is part of a plan to eliminate a $10 billion state deficit.

The neighboring Shoreham-Wading River school district is facing an 11.62 percent state aid cut, or $985,326, courtesy of the governor’s first state budget proposal, which proposes to cut aid by 10 percent in Suffolk County and 7.3 percent statewide, reportedly one of the largest proposed statewide cuts ever.

”This is the worst it’s ever been,” Ms. Carney told the News-Review last week. She said that while governors customarily propose steeper cuts than what ends up being approved in the final state budget, the district still has to plan its budget based on the governor’s numbers, unless it gets other information.

“It’s totally not what we were expecting,” she continued. “We thought we might lose 5 percent of our state aid. We’re losing about 16 percent of our state aid. It’s huge.”

State Senator Ken LaValle (R-Port Jefferson) said the proposed cuts to Long Island schools were out of proportion with cuts elsewhere, and he said the state Senate’s new Republican majority seeks to change that.

“These are extremely difficult economic times and everyone is being asked to do more with less,” Mr. LaValle said. “However, no single region of the state should shoulder an unfair proportion of cuts to education. As in the past, the Long Island Senate delegation will work together to ensure L.I. schools are not being asked to underwrite cuts in education for other areas of the state.

“We will ensure that Long Island is treated fairly and equitably within the budget footprint.”

The final budget vote is May 17, but officials in Riverhead cannot make accurate tax rate estimates at that time because the district is split between three towns that have separate tax rates that are affected by factors like final state aid numbers, equalization rates and town assessment figures — which don’t become final until later in the year.

Ms. Carney said that 61 percent of the proposed increase is due to big increases in Teachers Retirement System contributions and the Employees Retirement System. Those numbers are dictated by the state and the district has little control of them. Combined, the two funds are scheduled to increase 40 percent, or $2.2 million, according to Ms. Carney.

Contractually mandated increases from negotiated and previously approved labor contracts also amount to $2.1 million, and would account for a 2.55 percent increase in the tax levy by itself, the superintendent said.

The projected 5.7 percent tax levy increase includes the use of $3.375 million in reserve funds to offset taxes, according to the draft budget proposal. Without the use of those reserves, the increase would have been about 7.8 percent.

The draft budget would use almost all the district’s reserve funds, which Ms. Carney said come to about $3.5 million. Governor Cuomo has said that most districts have enough reserve funds on hand to offset the aid cuts.

The superintendent said her spending plan proposes cuts to all sections of the budget, and will impact administrators, teachers and nonteaching staff.

The district is considering cutting some extracurricular activities, some sports programs, instituting larger class sizes, making staff cuts, with further reduction in building maintenance and fewer bus stops, she added.

“We have no choice but to make the cuts as if [state aid reductions] are going to happen,” school board president Ann Cotten-Degrasse said during Tuesday night’s meeting.

Ms. Carney said that if the budget had simply rolled over all existing costs, and factored in cost-of-living increases and increases in contractual issues like salaries, the spending increase would have been around 7 percent.

The school board has about three months to adopt a budget, which will be presented to the community for the May 17 vote.

As for the Shoreham-Wading River district, its outgoing superintendent has yet to draft a proposed budget.

“That’s a tremendous sum of money,” board president Jack Costas said of the possible $985,326 state aid cut. “Obviously we are going to be facing cuts ­— probably in athletics. We’re seeing where we might be able to eliminate teaching positions through attrition or, if we have to, layoffs. There’s always that possibility.”

Mr. Costas said “the only way to make up for the shortfall in aid is to increase the tax levy or to apply prior year state aid funds to bridge the gap.”
Shoreham-Wading River, which has a current budget of $57.9 million, is also losing $354,607 in stimulus funds.

“We’re in the beginning stages of formulating our budget,” Mr. Costas said. “It’s very difficult to propose a budget when Albany itself has not passed their budget. It’s a little bit of a guessing game. We’ll take the most conservative estimates available and that’s how we’ll formulate the budget.”

The governor is proposing to cut school aid by $1.5 billion statewide, but says this represents only 2.9 percent of total school expenditures across the state.

School aid is the largest state-supported program and represents 29 percent of New York’s general fund, the governor said in his budget address.

To offset some cuts moving forward, Mr. Cuomo hopes to develop a $250 million statewide grant system through which money would be awarded on a competitive basis to school districts that demonstrate significant improvement in student performance outcomes, and another $250 million to districts that undertake long-term structural changes to reduce costs and improve efficiency.

[email protected]

Like the Riverhead-News Review on Facebook and follow us on Twitter for breaking news alerts.

Looking to comment on this article? Send us a letter to the editor instead.