The Derby school district’s tight budget is being stretched beyond its limits, so Superintendent Stephen Tracy hopes the Derby tax board will give the schools another $99,000.
However, school officials said the request won’t affect the city’s bottom line.
The school district has incurred about $240,000 in unanticipated expenses since the fiscal year started July 1, Tracy told the Valley Indy.
Example — the school district had more students enroll for the second grade in the city’s two elementary schools, causing the district to hire two new teachers — as mandated by class-size limits in the teachers’ union contract, Tracy said.
“By contract, we had to hire two additional teachers and that’s about $50,000 a piece when you do that,” the superintendent said.
In addition, the school district had to hire more para-professional staffers than anticipated. Para-professionals help kids with special needs, generally, and the school district can’t pick and choose who gets the service.
For the most part, the school district has been able to deal with the unexpected costs by moving money out of unemployment insurance and reducing the amount of money budgeted to buy supplies.
However, given it’s only October, Tracy said it makes sense to go back and talk about the situation with the Derby Board of Apportionment and Taxation (tax board).
The $99,000 being requested won’t hurt the city, school officials say.
Here’s why:
Back in May, at the suggestion of Mayor Anthony Staffieri, the tax board decided to cover expenses connected to the school district’s health benefits.
That took roughly $3 million in health care costs out of the school budget and transferred it to the city budget.
However, Tracy said about $99,000 of that $3 million included benefits to long-retired teachers who no longer qualify for their benefits.
Since the money isn’t needed for health care costs, Tracy and the school board would like the money back in the school budget.
“The city will not be paying that money out because the people who would have received it are no longer eligible for it,” Tracy said.
The superintendent made this same request back in August, tax board meeting minutes show.
The tax board didn’t take action on the request. Instead, members opted to see how the new health plan was working, according to meeting minutes.
The Derby Board of Education gave Tracy permission Oct. 4 to make a second request to the tax board.
Tracy said he would be calling tax board chairwoman Judy Szewczyk with the hope the money request would be added to the tax board’s next meeting agenda.
Yes, the City of Derby took over the administration of the medical insurance for all City employees, including the schools, starting this fiscal year. This method of payment is called self-insurance because instead of paying costly, fixed premiums every month, we pay just for those medical services rendered. This plan was adopted by a 10 member unanimous vote of the Tax Board, because it was an excellent way for the City to save money and it didn’t affect the current medical plans of any of the employees. So it was definitely a win-win.
When the Board brought across the medical funds, that the schools had just asked for in their new budget, we also brought across the $99k because it had also been requested for the new fiscal year for medical funding. It made sense that we bring the total amount in the medical funding account across to the city side.
The schools came to the Tax Board, after the budget was passed, and asked for that money back because they explained that it should not have been in the medical insurance account in the first place because these individuals were retired and were not going to receive benefits any longer.
Since the $99k was not for medical expenses and had not been included in their original budget for other purposes, the Tax Board decided that they wanted to wait for a few months to see how the self insurance was performing, i.e. was it reaping the savings level we were expecting, and then revisit the schools request to give them $99k back from our medical funds.
This was presented to the Board at our August 15 meeting and after we discussed it with Dr Tracy, at some length, a motion was made by Mark Nichols “to table this discussion for two to three months until the City can have some experience with the medical system”. The motion was seconded by Tim Conlon. It passed with only one nay vote from Carlos Malerba.
I fully expected this to come back at us in November or December, at which time we should have a much better feel for the self-insurance program performance and can decide, at that time, if in fact the City can afford this extra amount, beyond the school’s official budget.
This is basically an accounting oops that needs to be straightened out. Since the schools typically return close to $100k to the City coffers each year (and that was covered in the local papers a few months ago), we on the Tax Board are understanding that the $99k request is not of an urgent nature or a make or break amount for the Derby Schools at this moment in time.
Dr. Tracy has already requested, through me on October 7, that the matter be revisited at our October 17 meeting. This would only give us a scant 2 months to extrapolate our self-funding benefits but we will certainly put the request on the agenda for our next meeting.
The Tax Board is very cognizant of the schools needs and we are strong supporters of education. At the same time we are charged with looking out for the City’s finances and the welfare of all Derby residents. Given the high-cost of education today, these are unfortunately difficult goals to reconcile in every instance.
(Judy Szewczyk – chair Tax Board)
I have a question, Judy: do we have numbers for at least the first two months for cost analysis? I know it’s a small (pathetically so) sample size, but just for some sort of comparison’s sake?”
(Personally, I think the item can wait another month, but it’s not a backbreaker in either direction)
I’m sorry I didn’t see your post earlier! I have a few irons in the fire right now. I can’t share any numbers yet because they just wouldn’t make sense and I feel it would be misleading. By the time the next budget cycle rolls around, starting in March 2012, we’ll have a full, documented report from the plan administrators.