12/17 NASD Board Meeting Notes

Meeting started a little late at 7:55 PM. Marino, Audenreid, Hensley and Heller were absent.

There was a brief report from the student representative near the beginning of the meeting, but most of the over two hours were devoted to the presentation of the 2008-09 preliminary budget.

Dr. Lesky and Ms. Rishcoff had prepared a powerpoint presentation to highlight the 08-09 budget and how it comes together. Basically, the budget begins to take shape almost immediately after approval of the previous years budget. In July there will be a Strategic Plan Review, followed by Action Planning from August to October. Then in late October (for this year it was Nov 4) the administration meets with the board on a Saturday morning workshop to review and revise.

Here are some preliminary numbers from the 2008-09 budget:

Total Budget: $60,469,190 (7.1% increase from 07-08)

The 08-09 Budget includes a 2.48 mill or 6.15% tax increase. To be within the Act 1 index, NASD must cut another $266,529. The Act 1 index for NASD is 5.4%. This is the limit that NASD can raise property taxes without (a) utilizing Act 1 Exemptions or (b) going to public referendum.

While the budget certainly lays out all the expenditures with increase (or decrease) over last years budget, it's tough to really get a good handle on what's increasing with the exception of the debt (Bonds issued to finance the construction of the 7-8 school). $1.5M increase over last year is due directly to the debt on the 7-8 school construction bonds. The rest is a couple dollars here and there, but in the end, they all add up.

Where it gets interesting (or maybe depressing) is when you start looking at spending and revenue projections and the ever diverging lines for subsequent years. Under the 1st scenario which would:

Fund the 2008-09 Prelim Budget at its current level requiring a 6.15% tax rate increase using the Act 1 Exceptions will require a 2.48 tax mill increase for 08-09 year.

Some of the numbers under this scenario:

08-09 Rev $58.4M, Expend $60.5M, need 6.16% tax increase
09-10 Rev $59.6M, Expend $66.0M, need 11.67% tax increase
10-11 Rev $61.5M, Expend $70.6M, need 6.31% tax increase
11-12 Rev $63.4M, Expend $75.3M, need 6.00% tax increase
12-13 Rev $67.8M, Expend $83.1M, need 6.75% tax increase

Dr. Lesky and Ms. Rischoff presented two other scenarios which would lessen the gap between revenues and expenditures, but NASD could still very well be looking at a voter referendum to decide the school budget within 2-4 years.

Option 3, which it appeared was favored by Dr. Lesky, would:

Fund the 2008-09 Prelim Budget at the State Act 1 index level requiring a 5.4% tax rate increase, choosing not to use the exceptions that the NASD will qualify for under the current law and set a goal to reduce expenditures by an additional $500,000.

Some of the projected numbers under this scenario:

08-09 Rev $60.2M, Expend $59.7M, need 5.4% tax increase
09-10 Rev $63.0M, Expend $65.3M, need 6.01% tax increase
10-11 Rev $66.7M, Expend $69.8M, need 7.87% tax increase
11-12 Rev $70.5M, Expend $74.4M, need 9.30% tax increase
12-13 Rev $77.0M, Expend $82.2M, need 11.25% tax increase

Cutting the additional $500,000 might prove difficult (or unpalatable). One of the things that have already been cut in this budget is $34,000 for field trips. This was an item that was threatened to be cut last year, until our "windfall" came in from Northampton County. I for one, know my daughter really enjoyed her field trips last year.

Again, at this point there are a lot of uncertainties, especially on the revenue side. In past years, we have seen an increase in real estate assessed valuation of approximately 4.0% per year. Last year, NASD received a "windfall" in that the assessed valuation came back higher by 6.58%. This was in part due to Northampton Co "catching up" with past due assessments. For reference, in this down year, as of November, Northampton Co was looking at an approximate 1.2% increase over last year. Not exactly what you want to hear....

Dr. Lesky ended his presentation with a couple slides that showed how the board and admin have been fiscally responsible over the past 8 years. In 99-00, NASD was 2nd out of 8 school districts in Northampton Co at 32.85 mills (behind Bangor at 33.6). In 07-08, NASD was 6th at 40.32 mills, which represented a 22.7% increase over 8 years. Other districts had much higher tax increases over those years.

So that was the bulk of the meeting. All in all, we are facing some really tough decisions going forward; but whatever way you slice it, it looks like there will be sizable budget and subsequent tax increases for the forseeable future.

There were a few questions/clarifications at during the final community corner, but it was late (after 10) and I think we wanted to go home. Meeting adjourned at 10:10 PM.