We suspect the comment we just posted on the Forecaster article, which is appended below, will end the jousting between Rich Ellis and this reporter.
After sleeping on the subject, it occurred to us that the whole discussion centered around the fact that the annual school budgets never show actual spending for past years, only the originally budgeted amounts. You’d think they would be fairly close to each other, but you’d be wrong.
So, as you’ll read below, we reworded the description of the annual per student costs. We maintain that all other aspects of the column stand as stated.
Separately, the absence of actuals and summary balance sheets as we find in the municipal budget raises its own concerns. We will do our best to follow up on this aspect of things.
Mr. Ellis:
You’ve certainly cleared things up for me; thanks for that. I trust everyone else who sees your posts is similarly inclined.
In retrospect, I submit that everything in my article stands as written with the exception of this passage:
• Now the worst part: annual per-student costs have grown from $8,230 in 2004-2005 to $13,559 in the current year, an increase of $5,329, or 65 percent. The result is a cumulative cost of $176,000 this year, compared to $123,000 five years ago, and $93,000 10 years ago – an increase of 89 percent.
I made the mistake of assuming that budget figures closely align with spending figures; I should have known better.
That said, rewording the passage as follows corrects the passage:
· Now the worst part: budgeted annual per-student costs have grown from $8,230 in 2004-2005 to $13,559 in the current year, an increase of $5,329, or 65 percent. The result is a cumulative budgeted cost of $176,000 this year, compared to $123,000 five years ago, and $93,000 10 years ago – an increase of 89 percent.
Accordingly, I submit this revision to the readers who come here, though it is not possible to make the correction in print.
I grant you the point above, but hardly see it as undermining my overall premise, nor the fiscal trends in the Department. The majority of your elaboration has been to emphasize the terminology mistake just described .
Tangential excursions into ‘subsidizable pupils’ and similar EPS esoterics are largely irrelevant to the conclusions I draw in the published item, but do serve to expose the underlying budget strategy and how it obscures reality.
Had Superintendents clearly stated in their budget presentations to the Town Council and the citizenry that there is a budgeted set-aside against expected costs, this confusion might have been avoided. On the other hand, it might have emphasized the need for a summary balance sheet.
Late development: I understand that in the various fund balances in the Municipal Budget, for the year ended June 30, 2010, of the $8,082,597 that is restricted, $7,952,876 is restricted for education. Hence, the lack of total disclosure in the School Budget points to other amounts being tucked away in a less than obvious location. Why aren’t these figures shown in the annual school budgets?
So, summing things up:
- To the extent that I used hasty and unwarranted language in response to your postings, I apologize.
- I take from our discussion that it is the practice of the School Department to submit a budget with something like a 10% cushion to deal with uncertainties. One would think that provides sufficient cushion for a ‘crisis’ year such as the one before us, in which the advertised shortfalls are something like 7% of the current budget. Especially since more sizable reserves apparently have been banked.
- Since there are no balance sheets provided in the School Budgets, it is not possible to reconcile revenues against actual expenditures and various reserve accounts that might or might not exist.
- We have no way of knowing about such accounts. If it is the standard practice going in to apply a 10% cushion to ‘expected’ expenditures, it would be more transparent and forthcoming to state up front a ‘budgeted reserve amount’ of the dollar figure so planned. A “reserved fund balance” of $3,500,000 against budgets of $33,319,985 and $33,301,672 seems too round a number two years in a row to be the difference between budget and actual expenditures. It begs the question of what actual amounts might have resulted from that difference, and where they end up. Since no reconciled balance sheet is provided, we have no way of knowing, do we? Inquiring minds would like to know, and even worse, inquiring minds are prone to speculate in the absence of complete disclosure.
- I have requested actual spending figures per school year, and as soon as I receive them, I will calculate new figures that I will designate as actual spending per student year.
- It would be helpful if you were to provide details of all reserve account balances, whether they show in the budget or not. As compared to the municipal budget, the school budget does not show an assets and liabilities summary, at least that I can find.
- You will note that the Municipal Budget explicitly states various fund balances, and these amounts are accumulated over a number of years. I understand that many of these reserves are essentially required practice. Because of the absence of multi-year balance sheets in the School Budget, it is not possible to know how ‘reserves’ are handled year to year. And I’m not going to review budgets state wide to discern the SOP.
- We were told closing Jordan Acres was an imperative because of structural damage from snow overloading. Is it too much to suggest that could have been prevented by removing heavy snow accumulations before they reached critical stage?
- We must hope, of course, that the other schools, including HBS, which are primarily flat roof structures, are tended to more diligently, lest we have to replace them or invest major renovation dollars if a winter like past years occurs again.
- At the taxpayer level, ‘local appropriation’ is fungible dollars. They go into the revenue stream, and I assume are spent just like all other dollars. Saying they only pay for local students and not tuitioned students from other towns is irrelevant to this discussion.
- I stand by my claims in the article that the revenue shortfalls cited in information from the Department were entirely predictable, if not to the exact dollar.
- Durham tuition loss reflects a decision of several years ago, and a well known one. Presumably the Department knows which students are from Durham, and when they will leave the system and take their dollars with them.
- Stimulus funds were clearly one time money, and their receipt comes with clear presumption that they will not be coming again.
- Loss of federal impact aid is a similar item. Presumably, the Department is aware of the loss of military dependent students, and should not be ‘surprised’ by the loss of related funds.
- Not to mention, of course, that Durham tuition and in particular, the federal impact aid, are well below per student costs, and therefore present a windfall gain against the students they supposedly paid for. You chose not to acknowledge or discuss this.
- GPA, while not up to the levels all would like, has increased on a per student basis, and the effects of student decline are tempered by a sliding 3 year average. While I am not an EPS formula expert, you acknowledge the figures are enrolment dependent. I suspect they are also school plant dependent and employee dependent, but you can elaborate on that if you wish.
- Last year at this time, the early leaks from the Department were that the budget for the coming year was looking like a $36-37 million total. Even though budgets have been flat, more or less, for several years, enrolment has been in steady decline. We’ll see what the actual spending figures show.
- Loss of 90 positions is an unclear claim in my view. I have payroll information reported to the state for the three prior school years, and they raise doubts as to whether 90 persons disappeared from the payroll, or instead, 90 separate pay lines disappeared. I plan to dig further into the details, and compare teacher totals to enrolment to better understand circumstances. Student to teacher ration, etc, will be of interest .
- I assert that the school department is run on the basis that automatic salary and benefit increases for the teachers have priority over everything else, and that teacher compensation has no merit or performance component. The best teachers make the very same as the worst teachers (at the same ed level and year step), and this fundamental truth undermines all the rhetoric about an ‘excellent education system’ and the professed need to spend more to make it better, because you ‘get what you pay for.’
- Perhaps you can calculate the annual teacher compensation totals, and compare the increases to the elimination of sports funding, etc.
- I believe that the school department does not competitively procure its insurance coverage, and that a sizable amount goes to the MEA middleman to be used as a political advocacy fund.
- Looking at the most recent school budget, I note the absence of any reference to actual expenditures as context for budget proposals. Surely by the time a budget proposal is presented to the Town Council in May, expenditure data for a good ¾ of the current school year is known, and could be provided to establish a point of reference.
- As to the budgets provided to the public, they are absent any actual spending figures. In the current budget, there are typically 3 columns: 09/10 budget, 10/11 budget, and 11/12 budget proposal. There is every opportunity to provide actuals in prior years as a baseline for understanding, but from what you have described, that would clearly result in questions.
- Furthermore, if one goes to the municipal budget that summarizes all spending for the town, including the School Department, you will see school figures stated as ‘expenditures’ that come very close to budget amounts, except for the most recent year and the approved budget year.
- As to difficulty estimating enrolment, the current budget estimated a total of 2488 in October 11; that compares to 2,456 reported in October, which means the estimate for this year was pretty close to reality.
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