By Elizabeth F. McNamara
This story has been updated since it first posted. An earlier version inaccurately reported the district had a $700,000 deficit. The district will need to take more than $700,000 from its fund balance to cover costs, but $400,000 of that amount was planned when the School Committee passed the budget last year. The deficit for the year looks to be around $400,000.
Finance Director Linda Dykeman told the School Committee the district was looking at a $400,000 deficit for the current fiscal year. The official notification meant the panel had five days to submit a “corrective action plan” to the state auditor general.
This will be the second year in a row the district has had to take such a move.
“I don’t know why it took so long to find out we’re running a deficit,” said schools lawyer Matt Oliverio. “Why are you running a deficit? … We have to articulate that – why we’re running a deficit.”
The question for the state: Is this an ongoing structural problem or a one (or two) year issue.
The School Committee got $770,000 less in funding from the town for fiscal year 2018. While it made adjustments, it started the fiscal year with little wiggle room.
The district suffered one budget hit right off the bat.
In addition, an influx of preschool-age children needing special services required opening another preschool classroom, at a cost of more than $100,000.
Another cost this year was an uptick in the number of students enrolling in charter schools. When parents decide to use a charter school instead of the district school, the per-pupil education cost – around $12,000 – follows the student. East Greenwich went from 8 to 12 students in charter schools this fiscal year. It’s unlikely this is a one-time expense, however, unless those students return to the district.
In addition, the district needed more nursing services this year than anticipated, at a cost of around $32,000.
Baked into the budget was a roughly $100,000 cost to implementing the new health savings account insurance program. The program will ultimately provide significant savings for the district – but in this first year the district took a hit.
One bright spot is $72,000 the district thought it would not be receiving from the state after the delayed passage of the state budget last year. School officials learned Friday that money would be coming after all.
The School Committee will be asking the Town Council for an supplemental appropriation for the unexpected increases in nursing and preschool costs. Town Manager Gayle Corrigan has denied earlier requests.
The district used more than $700,000 from its fund balance in fiscal year 2017 and is projected to need $760,000 from its fund balance this year. The fund balance today sits at around $3.2 million.
The School Committee requested a budget increase for FY2019 of $1.2 million; Corrigan put $149,500 in her budget. The panel plans to add a meeting to discuss budget issues Tuesday, May 29. By Town Charter, the budget must be approved by the Town Council by June 10.
Here’s a link to the district’s budget presentation from Monday, May 14. And here’s an update on the district’s fund balance: School fund balance breakdown 5/15/18.
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