By Katie Wagner, Staff Writer
MONTGOMERY — The school district’s health benefits costs for employees and the amount it’s being required to contribute to its noncertificated employees’ pensions are the line items most responsible for making the school district’s 2008-2009 budget extremely tight, the school district’s business administrator, Tom Venanzi, announced during a Board of Education meeting Tuesday.
The total proposed budget is $76,103,696.
While the school district budgeted $7,717,363 for this school year’s health insurance plan, it is budgeting $8,318,093 for the 2008-2009 school year, a 7.78-percent increase and the largest dollar increase from this year’s budget.
These increased health insurance costs are the result of the unusually large number of claims school district employees have made this school year, according to Mr. Venanzi. He added that the high volume of claims will force the school district to switch from a minimum premium plan to a more expensive one.
”We’ve had a very bad year this year to the point which we are running right at our premium dollars,” Mr. Venanzi said. “We’re going to have to put more money into the funds, “ referring to the health insurance premium account.
The high dollar amounts the school district will have to contribute to pensions of noncertificated employees, such as bus drivers, secretaries and custodians, are less surprising to the district. A state law implemented five years ago requires school districts to begin contributing to these pensions at a rate that increased 20 percent each year.
Next year marks the fifth year of this legislation’s impact, meaning that the district will be maxing out on the percentage of its employees’ contributions to their pensions it will have to make. The state is requiring these noncertificated employees to contribute 9.93 percent of their salaries to the state next year, so the school district will have to contribute the full 9.93 percent of each of these employees’ salaries to their pensions.
While $315,000 was allocated for these pensions in the 2007-2008 budget, $638,000 was allocated for the 2008-2009 budget. The increase of $323,000 represents a 103 percent increase from this school year’s budget.
Despite the tightness of the budget, the district is still requesting $364,421 less than the state allows it to collect through the local tax levy.
The $500,000 in savings on transportation costs the district is anticipating next year is one factor that has allowed the district to stay below the state’s tax levy cap. The district allocated $5,071,991 for all line items falling under its transportation budget for the 2008-2009 year, a decrease of $312,582 from the amount budgeted for this school year. A consultant hired by the district to create a more efficient busing plan for the district projected the savings that have been accounted for in the 2008-2009 budget.
”We believe the concept will work,” Mr. Venanzi said, regarding the transportation system.
The Board of Education will be voting on the proposed 2008-2009 budget at its Tuesday meeting. This budget needs to be approved and submitted to the county by March 6. County feedback will follow and changes will be made before a final budget is adopted.
