Helped by an increase in state aid, the Red Hook school district budget will increase only 1.75 percent for the coming year, according to preliminary figures.
The 2014-15 budget is $49,539,447, an increase of $1,131,826 from the 2013-14 budget of $48,407,621.
Taxes are projected to increase by 2.02 percent, just under the allowable amount under the state’s tax cap law, so the board will not need to override the cap. That levy will raise $31,324,293 in taxes.
School District Business Manager Bruce Martin said the tax rate could not be calculated using the preliminary numbers, but he estimated that if the board does adopt this budget, the rate per thousand would be close to $20.60, up 2 percent from last year’s $20.20.
“We have tried to do some budgetary tightening. We’re leaving less room for contingencies,” Martin told the Observer, noting that the budget as proposed leaves no room if there are unexpected high costs for winter heating fuel next year.
He said the district didn’t cut anything this year, but will not replace one retiring teacher because of smaller enrollments.
“We believe we were successful in creating a budget for 2014-15 that will maintain the program that we offer and stay under the tax cap,” he added.
At the Board of Education’s March 12 meeting, Martin said the draft budget projected a $691,421 gap between revenues and costs, which he blamed on state mandated increases associated with employee benefits, including retirement (3.68 projected growth for 2014-15), and a tax cap rule that restricts school district revenues to a 1.89 percent projected growth.
“Whether we’re talking about program reductions, consolidations of government services or using down one-time revenues [such as the fund balance], these strategies will not work forever. Eventually there will be nothing left to cut…we are always going to face a structural deficit until we find a way to either eliminate the built-in, mandated growth [such as retirement benefits] or get the kind of revenues to support that,” he told the board.
Total salary and benefits, which are contractual costs, are $38,113,785, up 4.53 percent from last year.
Martin told the Observer last week that since March, the district was able to close the budget gap in several ways. One pleasant surprise was a $175,000 reduction in health insurance costs for the upcoming year. And two other retiring teachers will be replaced by teachers with lower salaries, which also provides some savings.
More significantly, state aid is projected to be $15,235,322, an increase of 3.7 percent, or $544,192. The budget will also draw $250,000 from a $1.8 million reserve fund that was set aside to fund a long-term employee health insurance liability. Last year, the budget included $450,000 from the reserve that Martin said the district would not use this year.
The $250,000 from that reserve fund is in addition to an appropriation of $2.2 million from the fund balance, which will cover about 4 percent of the budget. Last year’s budget was also built on taking $2.2 million from the fund balance, a practice Martin told the board could not continue forever.
More details on the budget were to be presented at the April 23 meeting, where the board intends to adopt the budget, A copy of the budget will be posted on the district’s website by April 30. A public hearing is scheduled for May 7 at the Mill Road 3-5 cafeteria and the budget vote will be held May 20 in the Mill Road 3-5 gym.
Also on the ballot will be two out of the five board of education seats, those of Dawn Morrison and Ryan McCann, along with a $270,000 bus proposition for a full-size propane-fueled bus, a 30-passenger vehicle, two 20-passenger vehicles and one maintenance vehicle.