Community Groups Voice Support for the Proposed Scarsdale School Budget

Support for the proposed Scarsdale Schools $150mm budget for 2016-17 was strong among community organizations who commented at a public budget forum before the April 4, 2016 meeting of the Board of Education. The Board and Administration received praised for working collaboratively, for transparency, for clear presentations and for a new system of portfolios to prioritize, track and assess progress on key issues and district business.

While some of the groups urged the board to de-emphasize the state mandated tax cap when developing the budget, others were keenly focused on that metric. Also under discussion was the addition of 8.8 full time teachers at a time when district enrollment is projected to decrease slightly. Both the PT Council and the League of Women Voters commended the district for implementing a new STEAM curriculum for 2016-17 and for developing a program for high school students with emotional disabilities.

Recognizing the importance of a relatively newly formed Scarsdale Schools Educational Foundation to raise private funds for district initiatives and capital improvements, the LWVS asked the "Board to develop and adopt a separate policy regarding its relationship with and funding from the SSEF."

Both the Scarsdale Forum Education Committee and former Scarsdale Forum President Robert Berg, speaking on his own behalf, raised concerns about rising health care costs. The Forum noted that Medicare Part B reimbursements were rising due to the growing number of retirees. They also pointed out that health insurance costs have grown to be 12% of the budget and "questioned whether it is sustainable." Berg urged the Board and the Administration to "negotiate with the teachers' union for a more equitable sharing of increasing health insurance costs."

Despite their suggestions, the overall tone of the discussion was favorable and augurs a good outcome for the budget vote on Tuesday May 17.

Here are the complete statements that were read at the April 4 meeting:

Scarsdale PTC Exec. Committee Comments On 2016/17 Proposed School Budget

This year, we want to commend the Board and Administration on the organized, transparent and efficient budgeting process, and we welcome the opportunity to comment. We appreciate the budget presentations and supporting documents being made available online, and as handouts, during and after the public meetings. Mr. Mattey's frequent use of charts, tables and graphs to represent important numbers, statistics and ratios made all the information clear and accessible. We thank him, and his team, for that effort.

We also appreciate the Administration and Board's fiscal responsibility – while also providing for current and future educational initiatives focusing on the whole student, and 21st Century learning. The PTC Executive Committee supports the:
1) New staffing and coursework in S.T.E.A.M.-related subjects, as well as Phys. Ed.
2) Additional staffing to comply with various mandates, as well as the district's educational and best practices goals.
3) Decision to fund a comprehensive therapeutic intervention program for Scarsdale High School students who suffer from emotional disabilities.
4) Sustainability initiatives taking place at all district schools, and
5) Attention given to delayed Capital Improvements during the annual budgeting process.

We're pleased the district also experienced an unexpected budget surplus of more than $3 Million, during this season. The new Fund Balance should bring the District up to a reserve ratio that ratings agencies should view positively.

We understand the Administration's recommendation, and the Board's decision, not to offer unleveled Mandarin at the Middle School next year. Going forward, we encourage the Board and Administration to continue exploring ways in which language offerings could be introduced, and strengthened, at the Middle School level. We also encourage the Board and Administration to take a more critical look at the efficacy of the FLES program, in its current form.

We support the idea of reviewing the district's transportation policies, taking into account safety, efficiencies and practicality.

And, lastly, we appreciate the District's process for prioritizing Facility needs, agreeing that the Comfort Station doesn't take precedence over previously identified projects. We're very glad that many of our more pressing facility needs will be addressed sooner, rather than waiting for the next bond offering.

The PTC Executive Committee supports the budget in its current form, and thanks the Board of Education and the District Administration for being responsible stewards of the District's financial resources.

League of Women Voters of Scarsdale Comments on the Proposed School Budget 2016-17 April 4, 2016

The League of Women Voters of Scarsdale (the "League") thanks members of the Board of Education (the "Board") and District Administration (the "Administration") for participating as a panel and answering questions at the League's General Membership School Budget Information Meeting, March 29, 2016 at Village Hall. The League acknowledges with appreciation the substantial time and effort that goes into developing the budget and applauds the clear presentation of information provided by the Administration over the course of the budget cycle. The League further appreciates this opportunity to comment on the preliminary proposed school Budget, dated March 24, 2016 ("the Budget.") This statement reflects the consensus of League members discussed at a League consensus meeting held on March 29th.

Position

The League supports the Budget for the 2016-17 school year, which includes many positive features for Scarsdale students and the District and represents a prudent tax investment for the community. The League recommends that the community vote 'yes' to approve the Budget on Tuesday May 17, 2016.

Overview and Highlighted Educational Features of the Budget

The proposed $150,207,826 Budget represents a 1.46% total budget-to-budget increase and overall tax levy growth of 0.63%. The Budget proposes using $1.1 million from 2015-16 fund balance to off-set the tax levy increase.

The League appreciates the choices reflected in the budget that support educational values held by this community, including the decisions to:

• Add 8.8 FTE new teachers, which allows the district to maintain traditional class size practices and supports new curriculum growth in areas such as STEAM, technology, elementary language, and special education;
• Fund the various reserves at levels that are both fiscally prudent and protect the District's AAA rating;
• Fund capital improvements as part of the operations budget at higher levels to ensure our facilities support student learning and safety;
• Fund a new emotional support program in the high school;
• Continue ongoing maintenance and investment in the busing fleet as recommended in the last transportation review;
• Continue to fund and/or expand professional development programs such as Education for Tomorrow 2.0 and Center for Innovation which represent hallmarks of the District's approach;
• Fund ongoing technology needs that support and enhance student learning, teacher usage and District management.

Issue: New Budget Process

The League takes note of the change in approach to budget development, described by the Administration and Board to be a flexible process built out of educational and programmatic needs which are collectively defined by cabinet members and building administrators. Further, the League understands that, as budget items are defined, they remain open to adjustment as the budget package is built, using placeholders and regular vetting opportunities with the Board. The Administration and Board defined this process as more collaborative and productive than an additive process with 'puts and takes.'

The League notes the following process changes, as items for future monitoring and review:
• The introduction of the Transition Plan, the de facto strategic plan, representing the goals of the Administration and Board, and described as a living document with increased accountability.
• The creation of a Portfolio System, based on a restructure of the central office and inclusive of the Board.
• Reliance on the Transition Plan as a primary budget driver.
• The earlier start of the budget process as part of the 'Budget and Finance, Negotiation Portfolio,' including regular reporting to the community in workshop meetings and in open presentations of programs under development.
• The use of 'affirmations' as a way for the Administration to gauge the Board's
willingness to consider funding items in question.

The League applauds the Administration's stated desire for public input. Core to our mission, the League values transparency in governance and encourages information dissemination and community engagement in the processes that impact our lives.

Recommendation: Recognizing that the Budget process is starting earlier and is moving in an integrated manner, the League encourages the Administration to include ample opportunity throughout the process for input from community stakeholders in a timely way. For example, the League would welcome the opportunity to meet with representatives of the Administration and the Board at the beginning of the budget process next year (in December or January) in addition to our traditional information session in the early spring.

The League appreciates the Administration's open posture regarding the future progress of the Transition Plan and acknowledgement that these changes are in an early phase of development.

Recommendation: The League recommends that the Administration and the Board reflect on the successes and challenges of this year with candor and develop, define and communicate the next phases of the Transition Plan, inclusive of community input. The League encourages the Administration and the Board to consider that whatever the next steps become, the plan will enhance transparency and provide clearly-defined and formalized opportunities for early dialogue with the community, beyond what already exists.

Issues: State Imposed Tax Levy Limit (the 'tax cap')

The League reiterates our continued support of the Administration's and the Board's stated policy of not budgeting to a state-calculated tax cap. Although the League values the assertion made by the Administration that it is not using 'the cap' as a budget guide because it is an arbitrary line imposed by New York state law, we understand that it is a factor important to some in the community, and must be reported and addressed as part of the process. We remain concerned, however, that the tax cap is over-emphasized in budget discussions and offer that the tax cap is a more critical factor for the budget vote, and should be used only as a reference point in budget development.

Though New York officials and the press regularly refer to the State imposed tax levy limit as a 'Two Percent Tax Cap,' this is a misnomer. This year, the calculation for the projected tax cap levy limit is 0.81%. As we learned at our March 29 meeting, the near-zero tax cap rate this year caused significant concern earlier in the budget development process, and the fact that the Budget is under the tax cap by $249,932, is due, in part, to fortunate circumstances, including a decrease in mandated pension contributions due to favorable market conditions, lower-than-estimated utility bills due to decreased fuel costs and a mild winter, and the retirement of 19 seasoned teachers, permitting lower salaries to replace higher ones. These factors may not repeat in the future.

Recommendation: The League recommends the Board and Administration adjust communication practices to both reduce emphasis on the tax cap as a single-point guiding metric and include more nuanced education about the tax cap impact. We recommend this change of emphasis in anticipation of any possible future need for the Board to request an override, and to be able to garner enough community support to approve a budget that exceeds the tax cap.

Issue: Capital Investment

After years of underfunding during recession years, the League commends the continued focus on funding for capital improvement projects in the annual operating budget, both as part of the initial budget projections and as a place for investing newly-identified 2015-16 budget surplus dollars. At minimum, our buildings must support student learning and be safe, welcoming spaces, and ideally, should be sustainable and flexible environments, able to support changing technologies and enhance current and future programs.

Recommendations: Considering the age of district facilities and the years of funding neglect in this area, we recommend continuing this trend to return regular, planned investment to nationally-recognized budget percentage norms for expenditure on capital improvements.

Issue: Advocacy for District Values in the State and Federal Landscape

The League understands that State and Federal policies impact the district in the form of unfunded mandates and other policies that do not always reflect our own community values or serve our students' best interests. While each year brings changes and the broader education landscape has new players, the League reiterates our concerns that challenges from the State continue to undermine traditional local democratic processes that have allowed Scarsdale community values to shape our schools.

The League appreciates that 'Political Outreach' has been included in the Portfolio system, with regular reports that inform the community on issues facing the District and of interactions with our local lawmakers, particularly in the areas of State testing, teacher evaluation mandates and State Aid.

Recommendation: The League reiterates our recommendation that the Board and Administration take on a greater role in advocacy in order to ensure Scarsdale schools continue to reflect our community values.

• We suggest the Board and Administration reinstate an Advisory Committee on Governmental Issues, or something similar, with broad community representation, in order to engage in dialogue on often-complicated issues that may impact the district;

• We continue to support Board involvement with outside advocacy groups, and recommend empowering participation at regional and state school board association meetings; and

• We continue to support the Board connecting with area districts to identify shared concerns and to make common cause with those affected to an even greater extent by the recent direction of State education policy.
Issue: Scarsdale Schools Education Foundation Policy

The League reiterates our support of public education funded by public dollars and therefore continues to monitor the Board's use of alternate funding sources outside of the budget.

Recommendation: In light of the size and nature of past and contemplated gifts from the SSEF, we again urge the Board to develop and adopt a separate policy regarding its relationship with and funding from the SSEF. The League recognizes the Administration's expressed willingness to undertake this item.

In conclusion, we thank all the members of the Board and the Administration for your ongoing stewardship of our beloved district and for your willingness to try new approaches in the service of this community's children. We trust you will take these comments into consideration as you deliberate on your final budget and as you reflect on ways to improve next year's budget process.

Sincerely,
Diane Greenwald
School Budget Study Chair

Deb Morel
President
League of Women Voters of Scarsdale

Report of the Education Committee of the Scarsdale Forum on the Scarsdale Board of Education Proposed 2016-17 Budget

The Committee reviewed the proposed budget of the Scarsdale Board of Education (the "Board") for the fiscal year 2016-17 and concluded the Forum should support its adoption.

The Committee applauds the presentation of the proposed budget over several meetings. The detailed description of the proposed funding made it easier to understand much of the rationale for revenues and expenses. The comparisons with both the current year's budget and the projected revenues and expenses, along with explanations for increases and decreases were easily understood.

HIGHLIGHTS OF THE PROPOSED 2016-17 BUDGET

• The Board of Education has proposed a budget of $150,207,366. That is an increase of $1,719,901 (1.16%) over projected expenditures for 2015-16 and an increase of $2,159,280 (1.46%) over the current year's adopted budget.
• Based on the initial tax assessment rolls, the projected decrease in tax rate is 3 cents per $1,000 of assessed value. The increase in the tax levy is 0.63%, which is below the calculated tax cap.
• The largest increase in the proposed budget is for increased staffing, a total of 10.4 FTE. Of those, 8.8 are teaching positions at an estimated cost of $913,000 in salary.
• The next largest increase is for capital projects. It is estimated to cost $725,240. Some of the work in this category is work that was originally planned to be covered by the bond issue authorized last year. However, based on revised cost estimates for the work planned to be funded by the bond some work could not be covered by the bond funds and had to be transferred to the 2016-17 budget.
• An area of growing importance is the 3rd greatest increase in the proposed budget – Medicare Part B reimbursement. This budget item estimated increase is $458,225. It has increased 100% since 2010-11 to a projected cost of $1,075,000 in the current year. The driver for this steep increase is primarily that the number of retirees has increased.
• The 4th largest increase is health insurance. It is budgeted to increase $432,979 to $17,536,577. This benefit now is almost 12% of the total budget. These last two increases together are almost 5% in healthcare cost and Committee members expressed concern regarding the increase in healthcare costs and questioned whether it is sustainable
Together, these four items' increase accounts for more than 76% of the increase in the proposed budget over the current budget.
1. Enrollment
Total enrollment in the district is expected to decrease by 6 students. Changes at all schools, except Greenacres are single digit. In Greenacres, the increase is forecast to be 24 students, requiring the addition of 1 section for 5th grade.
2. Revenue
Budget over budget increases in State aid of $580,369 and prior year surplus of $600,000 are the main drivers of revenue increase of $1,275,982. The tax levy is projected to be $140,142,277.
3. Staffing
The proposed 2016-17 includes 468.6 professional positions, an increase of 10.4 full-time equivalent (FTE) positions over the 2015-16 budget. The increase is in the category of Teachers/Librarians. The added positions are: 3.6 FTE at the HS, 1.2 FTE at the MS, a net of 3.4 FTE at the Elementary schools and 2.2 FTE District-wide. The Civil Service position proposed budget maintains the same number of FTE as the 2015-16 budget.
4. Reserves
The total proposed reserve monies are $18,683,372 at the end of the 2016-17 fiscal year. The three largest reserves total slightly greater than $14.5 M. They are: undesignated, health and tax certiorari. The Committee recognizes the direct correlation of the tax reserve with grievances regarding assessments. It also agreed that the increase in the undesignated reserve was appropriate when the State said the District was not permitted to maintain a designated reserve for health insurance since it was a single self-insuring entity. Fortunately the law was changed and the District is now permitted to maintain the $3,750,000 health reserve. Committee discussion regarding the increase in the undesignated reserve resulted in the recommendation that examples of possible ways the undesignated reserve might need to be used would help the public understand the reason for this $5.7M reserve.

CONCLUSION
The Committee applauds both the process used in developing the proposed budget and the proposed budget itself. It is recommended that the process used to develop the proposed budget be used as the model for subsequent years.

Dan Hochvert, Chair
Larry Bell
John Bensche
Robert Berg
Jordan Copeland
Susan Douglass
Dan Gerardi
Robert Harrison
Terri Harrison
Jackie Irwin
James Labick
Michelle Lichtenberg
Tracy McCarthy
Kamal Mehta
Phyllis Murray
Michael Otten
Mary Louise Perlman
Carlos Ramirez
Brice Kirkendall-Rodriguez
Mayra Kirkendall-Rodriguez
Harriet Sobol
Michelle Sterling
Beverley Sved
Bruce Wells

Robert Berg:

Good evening. Robert Berg, 32 Tisdale Road. I represent only myself tonight. I would like to provide you with my personal observations of the proposed Budget for 2016-2017.

As to this year's budget process, I thank the Board and the Administration for providing a very transparent process and an open and welcoming platform to receive and respond to community feedback.

I commend the Board and the Administration for once again presenting a proposed budget that falls below the State tax cap – however slightly.

Once again, you have proven that this School District can continue to maintain and enhance its programs and facilities, notwithstanding the fiscal constraints imposed by the tax cap.

When the tax cap was first implemented several years ago, the former Administration and Board ran around like Chicken Little – shouting that the sky was falling and that complying with the tax cap would destroy the Scarsdale Schools.

That Board and Administration proposed a bloated budget that blew through the tax cap, and the voters – in a near record turnout -- handily defeated the budget – marking the first school budget defeat in 45 years.

Since that historic budget defeat, all subsequent school budgets have complied with the tax cap, as does the proposed 2016-2017 budget. And that's a very good thing.

Scarsdale's taxpayers pay among the highest property taxes in the country – probably in the universe -- and many empty nesters, in particular, struggle mightily to remain in their Scarsdale homes where they have lived and contributed to the community for decades.

We need to encourage empty nesters to remain in town, and the only way to do so is to keep the growth rate in property taxes to an absolute minimum.

In this vein, this Board and Administration should be applauded for presenting a proposed budget that calls for a tax levy increase of .63% --below the tax cap of .81%. This is especially so since the Village Board smashed through the tax cap with a massive 3.69% increase in the tax levy. Kudos to you, and thumbs down to the Village Board for a change.

While that's great news, there are a number of elements in the proposed budget that are troubling, especially looking down the road.

The biggest driver of the budget increase is the proposal to add 8.8 FTE teaching positions, for a salary cost of $913, 000. Meanwhile, student enrollment is expected to decrease by six students, and the demographic trends don't call for any significant increases in student population over the next few years.

This new teacher add amounts to a very major and continuing fixed cost, especially considering that – correct me if I'm wrong – the incremental $913,000 does not include health benefits or retirement contributions, which add another 25% or 30% to the cost.

While I understand that a good case can be made for each new position, adding such a large number of new permanent teaching positions seems to me to be dangerous and excessive.

The proposed budget calls for two new full-time teachers in the elementary schools, where an increase of three additional students overall is forecast among the five elementary schools. Adding two new teachers to accommodate three additional elementary students – well, there's got to be a better solution than that.

I suggest at least one of the two new elementary teacher positions be removed from the budget.

I also suggest dropping the .5 full time physical education teacher position that is proposed for the second half of 2017 to coincide with completion of the fitness center. First of all, given the delays by the State with respect to the District's proposed work for the bond project passed last year, there seems to be little likelihood that the high school construction will get underway anytime soon.
Second, the fitness center is supposed to be funded largely by the Education Foundation. As I understand it, if the Foundation doesn't raise sufficient funds, the fitness center doesn't get built. While I am hopeful that the Foundation will be able to fund the proposed projects, I don't know where it stands now in the fundraising process. To fund a new gym teacher position for the second half of next year before we break ground and have a capital funding source doesn't make sense to me. Let's get all that in place first, and perhaps we can use existing phys ed teachers to fill the position should we somehow be up and running in the second half of the next school year.

My next issue is the raging growth in expenditures for Medicare Part B reimbursement and health insurance. The increase in the cost of Medicare Part B reimbursement – increasing year over year by $458,225 -- is quickly spiraling out of control. As the Forum Report notes, this cost has increased 100% since 2010-2011 to $1,075,000 in the current year and $1.5 million next year. Taxpayers cannot afford such massive increases, and the Board and Administration must negotiate with the teacher's union for a fairer reimbursement formula during the current contract negotiations.

The same is true for the growth in our health insurance expense. That is going up in the proposed budget by $432,979, to an amount that is 9.11% higher than this year's estimated health insurance expense. The budget proposes a now legal health insurance reserve of $3.75 million, coupled with a stop loss insurance policy for unanticipated catastrophic medical expenses. In light of the very large health insurance reserve, the $433,000 increase for health insurance seems unnecessary, or at the very least, excessive. And again, the Board and the Administration must negotiate with the teachers' union for a more equitable sharing of increasing health insurance costs.

Finally, I'm troubled by the proposed transfer of funds to pay for capital improvements that were supposed to be covered by last year's bond – such as the music facilities at the Middle School. First, I don't understand why the cost estimates last year were so far off. I thought our architects gave us real hard numbers.

Second, major capital improvements need to be bonded. Voters approved spending this money for the specified projects out of bond proceeds -- not out of the operating capital of the District. This strikes me as an inappropriate diversion of funds that will cause an increase in taxpayers' tax burden.

These are not emergency capital projects which should be funded from reserves or operating capital. If these projects are worthy – they should be bonded.
If you follow my recommendations, taxpayers will see a meaningful decrease in their school property taxes for the next year. We have the ability to give the beleaguered taxpayers of Scarsdale a break for once, and I urge you to do so.

Thank you.