Board adopts budget proposal and braces for potential mid-year state aid cuts
The General Brown Central School District is bracing for a challenging budget year for 2020-21 as the COVID-19 pandemic has contributed to a state budget gap that New York state officials are partially filling with monies that had been promised to schools.
The adopted state budget freezes foundation aid—the district’s base operating aid—at the current school year’s level, which is $77,678 less than what had been allocated to the district when the governor released his executive budget proposal in January, before COVID-19 was declared a pandemic.
In addition to less state aid for schools in the adopted state budget, the governor has forecast possible mid-year budget reductions for schools statewide.
“Our strategic plan served as a guide as we developed the 2020-21 budget proposal against the backdrop of the COVID-19 pandemic,” Superintendent Barbara Case said. “We recognize the significant impact this public health crisis is having on state and local finances and, of course, our General Brown community members.”
District plans for less revenue
In response, the district is proposing a 2020-21 operating budget of $24,334,794, which is a 3.29% decrease in spending compared to the current year. The bulk of the spending decrease is due to the district’s one-time $1.32 million lump-sum payment made in the current budget year toward a Jefferson-Lewis-Hamilton-Herkimer-Oneida BOCES capital project, which all BOCES component districts are required to contribute toward.
To further reduce the budget, the district is proposing conservative spending, such as limiting supply purchases only to those necessary for health and safety and offering professional development only at a local level to limit travel and consultant fees.
The district is proposing to maintain its current staffing levels to preserve its instructional program and student services.
“We are proposing reductions in spending where there would be the least impact on our students, and knowing that there could be state aid cuts mid-year, we will continue to monitor our spending throughout the school year and adjust as needed,” Assistant Superintendent Lisa Smith said.
Tax levy increase at district’s ‘cap’
The district has two primary revenue sources: state aid and the property tax levy. The tax levy is the total amount of money the district collects from property owners within the district to support the school budget.
State aid would support 63% of the proposed budget while the tax levy would support 35%. Sources such as interest income would account for the remaining 2% of the district’s anticipated revenue.
Compared to the current school year’s budget, the district is proposing a tax levy increase of 5.40%, which is at the district’s tax levy limit, or cap, so a simple majority of voters will be required to authorize the proposal.
Tax rate increase estimated to be less than 5.40%
The school tax levy is just one factor, along with assessment rates and equalization rates, that municipalities use to determine residents’ tax rates, which are used to calculate what each property owner will ultimately pay in school taxes.
The tax rate is typically less than the tax levy because of growth in the property tax base. Historically, the tax rate increase is 1 percentage point less than the tax levy increase.
Mid-year state aid adjustments possible
New provisions in the state budget contribute to uncertainty for school districts as they plan for the next school year. The provisions include three periodic reviews of state revenue that could result in mid-year school aid cuts. There is also a new “Pandemic Adjustment” state aid reduction that the state is using to help fill its budget gap.
General Brown is losing $321,000 in state aid due to the Pandemic Adjustment, and while federal stimulus dollars will replace those funds, the possibility for mid-year aid cuts means that schools may receive even less state funding than was promised in the adopted state budget.
Budget vote and board elections delayed
On April 6, the General Brown Board of Education adopted the 2020-21 budget proposal. School leaders are still awaiting a rescheduled date and process for the budget vote and board member elections, which the state has delayed until at least June 1 due to the COVID-19 pandemic.
In addition to voting on the budget proposal, residents will also be asked to elect two individuals for three-year terms to the board of education. The state has yet to set a final date for candidate nominating petitions to be returned to the district.
Once additional guidance related to the budget vote and board member elections is available, the district will share the information on the district website.