The school district is recommending a $90.34 million budget for the 2017-18 school year, a 2.1 percent increase over the current year’s budget. The budget calls for a 2.9 percent tax levy increase, which Dragone estimated would result in a tax rate increase of $22 for a home with an assessed property value of $225,000.
The budget maintains or enhances programs and staff at their current levels. The budget calls for the restoration of several positions that were left vacant for budgetary reasons following staff retirements. The positions include one full-time orchestra teacher, one high school technology teacher and three instructional teacher leader positions.
The budget also calls for the addition of one part time literary position at the middle school. The positions will be partially funded through the reallocation of funds from Milton Terrace Elementary School following the elimination of a fourth-grade section due to enrollment. The remainder will cost the district approximately $195,000.
Two additional factors impacting the budget are the increased cost of healthcare and the continuing loss of property value for GlobalFoundries. The cost of health insurance will increase by $1.19 million next year, an increase of 8.7 percent. The rising health care cost for the district accounts for more than half of the budget increase.
While costs continue to rise, the school district will continue to lose revenue from the Payment in Lieu of Tax agreement with GlobalFoundries. The site has lost property value year over year and is expected to fall to an estimated total value of $596.25 million in 2018. This represents a $35.08 million loss in property value from when it was first constructed.
The projected loss for 2018 will result in an estimated loss of $745,000 in tax revenue for the school district. Dragone has previously noted that the loss in value for GlobalFoundries will continue to present budgetary challenges for the school district, as the property is projected to continue losing value until 2031 when it is expected to reach a final value of $165.62 million.
While the school district has set the tax levy increase for the recommended 2017-18 budget, it has been unable to calculate final revenue sources, as the state budget remained incomplete prior to Wednesday’s meeting.
School district officials used figures from Governor Andrew Cuomo’s budget proposal to project state funding for the district. Dragone expressed his opinion that Cuomo’s proposal represents the lowest increase to Foundation Aid that would be approved by the state.
In his proposal, Cuomo called for a $428 million increase in Foundation Aid and the elimination of the Foundation Aid formula, suggesting a year to year disbursement instead.
Both the state Senate and the Assembly have rejected the elimination of the Foundation Aid formula. The Senate has proposed a $1.4 billion increase in Foundation Aid rolled out over four years out and the Assembly has called for a $906 million increase in Foundation Aid.
If state aid does not measure up to the district’s projections Dragone said that the district would be able to balance the budget using the general fund balance and reserve funds.
“The floor is not going to change and that is the Governor’s number. The three biggest chunks of revenue are state aid, taxes and fund balance,” Dragone said. “We have a bunch of different models built out that will take into account those different things.”
“As we get closer we can make the final recommendation knowing the projected aid. Managing the other pieces, we’ll be able to make sure that everything is covered. We’re confident of that,” he said.
The school board is expected to adopt the recommended budget at the April 12 meeting and a public hearing on the proposed budget will be held on May 3 at 6:30 p.m.
The statewide school budget vote will take place on May 16 from 7 a.m. to 9 p.m.