State school aid levels for 2013-2014 wll be critical
By Joanne Degnan, Managing Editor
ALLENTOWN The Upper Freehold Regional Board of Education released preliminary projections for the 2013-14 budget that show expenses exceeding revenues by $1.27 million, due mostly to declining tuition revenue from Millstone.
”That’s our challenge right now. We either need additional revenues or less expenditures,” school Business Administrator Diana Schiraldi told the board Jan. 16. “Somehow we have to bridge that gap.”
Ms. Schiraldi presented school board members with preliminary 2013-14 budget numbers showing $33,548,062 in anticipated general fund revenues, but $34,826,659 in projected expenses.
The draft budget with its projected $1.27 million shortfall already assumes the board will adopt a 2 percent increase in the school tax to raise $374,445. State law requires school tax levy increases over 2 percent to have voter approval, and board members stressed they did not want the levy increase to exceed 2 percent.
Overall spending is actually $80,622 less in the draft 2013-14 budget compared to the current budget a decrease of 0.2 percent, Ms. Schiraldi said. The budget shortfall is mainly from an anticipated $793,732 drop in tuition revenue from Millstone, which sends its students in grades nine to 12 to Allentown High School.
”We have a very big drop in enrollment from Millstone for next year,” Ms. Schiraldi said.
The Millstone tuition rate is set at $12,000 per student in 2013-14.
The drop in Millstone enrollment has not produced a correlating drop in expenses for the school district because for every Millstone student the district loses, it gains two new Upper Freehold students, Ms. Schiraldi said.
”Over the last four years, Millstone enrollment has declined by 40 students, and Upper Freehold’s has increased 80 students,” Ms. Schiraldi said.
The draft budget assumes the district receives a 3 percent increase ($145,415) in state education aid for 2013-14. The state aid numbers for New Jersey school districts, however, won’t be released until the end of February.
If state aid turns out to be greater than the expected 3 percent, that would move UFRSD closer to bridging its $1.27 million revenue gap, but less state aid than expected would exacerbate its budget problem.
”This is a work in progress,” Ms. Schiraldi told the board. “There’s some things we know, but some things we don’t know yet so this is our starting point.”
As for proposed 2013-14 expenditures, the district wants to use $170,000 in its capital reserve account to undertake several long-range facilities projects, Ms. Schiraldi said. These include energy conservation-related repairs that would save the district money in the long run, upgrades to the fire alarm system and electrical system in Newell Elementary School and possibly the replacement of some countertops in the high school’s science lab. The district also would like to spend $95,000 from its maintenance reserve account to resurface the high school track.
Right now, the draft budget includes funding for seven additional staff positions, including several special education jobs, and the new teachers needed to support the district’s expanding School Choice program at Stone Bridge Middle School and Allentown High School, Ms. Schiraldi said.
The state reimburses Choice districts, such as Upper Freehold Regional, for the tuition of out-of-district students participating in the Choice program. So far, 51 public school students from other districts have been accepted into the UFRSD Choice program for 2013-14, but applications from private school students still are being reviewed so the final Choice enrollment number is subject to change.
The state’s Interdistrict School Choice program gives students an opportunity to enroll in unique educational programs unavailable in their home school district, with the state paying tuition to the Choice district. The state has not finalized Choice tuition rates for 2013-14, but UFRSD expects about $350,000 based on the state-set tuition rates in previous years.
”Do you have an estimate of what the additional costs are for adding those additional (Choice) students?” board member Peter Katz asked administrators.
Schools Superintendent Richard Fitzpatrick replied Choice expenses were projected to be $120,000 far less than the $350,000 in anticipated Choice revenue.
Ms. Schiraldi pointed out she had not included the $350,000 in expected Choice tuition in her budget revenue spreadsheet, and those funds, therefore, would help bridge the $1.27 million budget shortfall. She said she also had identified about $200,000 in cuts that potentially could be made to the 2013-14 budget in energy expenses, unemployment insurance payments and transportation.
”We are chipping away at this,” Ms. Schiraldi said.
A $1.27 million budget gap this early in the budget process is not insurmountable, Ms. Schiraldi said.
Last year, the school district began the budget process with a $976,229 gap between revenue and expenses that it eventually was able to close, thanks in part to a $926,226 increase in state aid, Ms. Schiraldi said.