BY ELAINE VAN DEVELDE
Staff Writer
EDISON — It’s a no-win situation riddled with contradictions.
That’s what school district business administrator Daniel Michaud thinks s about the new state-imposed limits on spending and saving.
The new budget restrictions that were designed to save taxpayers money. In the long-term, they won’t do any such thing, he said.
There are always hikes in costs and greater expectations by the state that cost money, regardless of any limits imposed by the state, Michaud said.
Taxpayers will have to pay the price, because the state government is doing nothing to fix an inherently flawed property tax system, he added.
The property tax formula puts most of the school costs on taxpayers by default, because there is no one left to pay for mandated hikes in cost, he said.
The state Department of Education in July limited school district spending from year to year of 2.5 percent above the total budget amount. The spending cap was 3 percent before.
The DOE also halved the amount schools were allowed to keep in surplus, from six percent to three percent.
The cap on surplus won’t affect the Edison school district immediately, Michaud said.
“However, long-term it puts schools in an unmanageable situation,” he said. “The state mandates that we spend all this money on things such as contract increases, special education costs and at the same time, they freeze state aid. Where else are we supposed to get the money from but the taxpayer? That is the unfortunate reality.”
Either the state should give the aid to offset the costs it mandates or not mandate the costs to begin with, said Michaud.
Right now, the cap on surplus does not affect Edison, he said, because the district’s 2004-05 school year surplus did not come near three percent cap.
The district’s total budget was $166,606,925 million and the surplus is at about $1.7 million, or slightly more than 1 percent.
“If we had more than 3 percent, we would have had to give it back in the form of tax relief,” Michaud said. “But that obviously was not the case. Last year we had $1,088,000, so it wouldn’t have applied then either.
The new 2.5 cap in spending means that the district can only go up about $3 million in spending next year, he said.
“What it means is that we are going to be without the benefit of $1.5 to $2 million worth of spending,” Michaud said.
The $3 million allowed does not cover energy, health benefits, out-of-district placements, risk insurance and salary increase costs., he said.
Most contract increases are at least four percent a year, he said.
“Without the money to compensate for those mandatory salary increases, we just have to cut staff,” Michaud said. “People go crazy over that. No one likes to see classroom size increase.”
Classes sizes in the Edison district are in the high 20s, approaching 30, in a district where officials had always tried to keep them in the low 20s, he said.
“We try to compensate, but it is difficult,” he said. “We pride ourselves on the quality of education offered. But it costs money and there is no help.”