Tuesday, February 9, 2010

A Blizzard of Bad News

I attended Rick Timbs's talk at DHS last night on The State of the District's Finances. The word, in a nutshell, is "sucks"--not through any fault of the district, which has been relatively prudent lo these many years, but rather via 9/11 followed by Wall Street followed by bad bank loans followed by economic collapse, both state and federal.

If they use the governor's budget and add nothing at all (roll over), they're looking at over 20 percent increase in the tax levy. Or they can cut $2.5 million in program and personnel and maintain a tax levy increase that looks about like those of the last few years.

The high costs in all NYS districts this year are special ed and employee benefits, especially retirement costs, which were creamed in the Wall Street crash. They can take money from reserves, but that will ultimately mean they can't pay their bills and have to borrow money, which means they'll pay interest on that money, which will in turn be passed on to the taxpayers.

They could get rid of most administrators and all sports and not make a dent. Cuts will have to come from teachers and staff, and lots of them. This will, of course, lead to more unemployment in our area, which eventually affects revenue.

The problem with cutting teachers is that you must cut the last hired first, and they tend to be the young and peppy ones rather than the dead wood you'd like to see gone.

Our relative wealth factor is about 0.5, meaning that we're half as rich as the average district in NYS. Our state aid is, to some extent, built around that number. However, big foreclosures and big unemployment are not hitting us locally--they are hitting those wealthier districts. That means that if the state sits down and does a reassessment, we'll look richer than we did (although we're not richer than we were), and we'll automatically get less state aid.

The board mostly sat in stunned silence, and who could blame them. I asked Rick whether he'd heard of any clever ways to mitigate special ed costs. He said no, mostly schools are finding they're out of compliance and actually have to spend more.

Ithaca is talking about closing Fall Creek School. I have to assume that our primary schools will need to be on the chopping block again, no matter what people say.

There are things to be done legislatively: 1) get rid of the roadblocks to negotiations (Triborough/Taylor); 2) get rid of high tax aid to high wealth districts and divide that money among poor districts like ours. But there's not a thing that can be done fast enough to solve this year's problems, and since our legislature, in its infinite wisdom, already plunged into next year's federal stimulus funds to keep us from having midyear cuts, we're looking at an even worse 2011-2012.

Right now, most Dryden residents pay $20.43/$1000 in school taxes. Even just a 10 percent tax rate increase would bring this household's school taxes up over $10K/year. I'm really not getting my money's worth.

1 comment:

Elizabeth Lutwak said...

Oh, dear, the last in. I could never be mistaken for peppy or young!

A growing trend in our district is to hire the grey haired. Freshly minted from Ed degrees as any of those young whippersnappers, we also have the benefit of being known quantities (a few calls around town will do) with little or no chance of maternity leaves.

The mommies from Althea's kindergarten class are slowly becoming faculty and staff at all of the town schools. It's a running joke for us, but the town sees it for what it is, a bargain with little chance of the premium retirement package ever being earned.