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fringe
Citizen
Username: Fringe
Post Number: 296
Registered: 5-2001
| | Posted on Tuesday, February 24, 2004 - 7:55 am: |     |
In a surprise move, Super H, faced with a potential $4 million shortfall between what he wants to spend and what the state will let him spend without a Separate Proposal, floated an unexpected hot air balloon at Monday's BOE meeting containing his preferences for that rump budget mechanism. Under close questioning by Betheil, both Super H and his trusty sidekick Karla, denied that there were many other items not required for Thorough & Efficient (T&E) education. But, he did finally admit that this was a political or judgment call, as he preferred. I guess it's his judgment/opinion that the roughly $550,000 in non-required courtesy busing and $500,000 for the Alternative Program at Montrose, among many other possibilities, are T&E which precludes their inclusion on the list built around the ~$1.5 million in new proposed spending and included:
* Custodians - $217,000
* K-5 Curriculum Coordinator - $100,000
* Technology items - $690,000
* Teachers - $387,000
* Guidance/Summer school - $23,000
* CHS Security - $92,000
* Fine Arts items - $86,000
* Special Education personnel - $124,000
* Breakfast Program - $40,000
* Project Ahead - $200,000
* Elementary Instrumental Music - $78,000
* Social Workers - $223,000
* CHS trainer - $74,000
* In-school suspension - $35,000
* Athletics/co-curricular stipends - $400,000
* operations - $150,000
* can't read notes - $100,000
Some bright bulb of a BOE member noted that this list only totals about $3 million - $1 million short of the potential $4 million gap. While Super H et al tried to explain this by saying that they struggled to assemble this list, a cynic would note that the 5% tax increase floated by certain BOSE members would allow for a $1 million Separtae Proposal - but it's probably just a coincidence.
I wonder if we'll see this version of New Jersey Hold 'Em as part of the World Series of Poker episodes? They need some new ones, the drama of Moneymaker's luck was lost after the third viewing.
JTL
PS Note that our upcoming N-R Op-Ed was submitted before Super H's unexpected move.
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mellie
Citizen
Username: Mellie
Post Number: 409
Registered: 4-2002
| | Posted on Tuesday, February 24, 2004 - 8:14 am: | |
Thanks for going Fringe - I planned to go but had to work to earn enough to pay for the tax increase.
But what are you saying - that he has unnecessary expenditures totalling $X in the budget - it is unclear from the above. I don't know what a rump budget is, and you have too much "insiderisms" in your note. Keep it plain and simple.
As I continue to raise - what are the major compents of the increase in spend of about $6.6m, and why - it basically all pay rises and increased benefits expense ie people costs.
And, apart from the technology items above (necessity ?) the rest of you analysis is staff cost related - yet staff numbers are falling, so why should any of the above cost more at all - why is it not covered by the existing staff base?
I agree on one thing - given the extra time afforded by the snow days the analysis should be complete. No one should be struggling for data.
Re snow days- that's what the bonuses are for- to get off your arse and come to work and get thing sdone one time. Did anyone out there get a snow day so they could fail to do their job ? Didn't think so. What's the next excuse -the dog ate it?
While I am on the topic I read in the Jan 29 N-R that the head of the BSE (if I recollect correctly) said that because the state aid was not known ALL budget figures were meaningless. A more meaningles statement I have never read. Is he telling us that total salaries cannot be known because the state hasn't told us the aid figure; or that our utilities expense is affected by it? Every damn number in that budget can be known in advance- and published in advance - it is 90% fixed cost base - what is there to wait for ? |
jfburch
Citizen
Username: Jfburch
Post Number: 1307
Registered: 6-2001
| | Posted on Tuesday, February 24, 2004 - 9:38 am: | |
Mellie, I'll try to keep this as simple as possible.
There are many constraints on the budget. Some are "hard"---meaning there is nothing anyone can do about them. Some are "soft"--meaning choices can be made--though at this point those choices are all more or less painful.
The "insiderisms" in fringe's post above deal with some hard constraints on the budget--namely state regulations about allowable budget increases.
In short, all districts are charged with coming up with a budget for the "thorough and efficient" education of its kids, also known as the "T&E budget".
There is a legal cap on annual increases to that T&E budget of about 3%, though the specific upper limit is set each year by the state. We should have that specific number tomorrow I believe.
If a district wants to have a budget that exceeds that cap, they must essentially break it into two parts. The main budget is the T&E budget up to the cap. This level of spending will typically be approved
The second piece is the "separate proposal" which must be approved--or denied--separately. In theory, items under a special proposal are "extra"--things we might like to have and could choose or not choose to spend on right now.
In practice, budgets are so tight that there are no "extras" so this district and many others faced with budget crunches are trying to figure out what important or essential items they can or will pull out of their base budget and put in the separate proposal.
This year the difference between the proposed budget and the likely state cap is about 4 million dollars; that is huge. Past separate proposals have been much smaller.
The items fringe lists are things the Superintendent is suggesting he will put in a separate proposal. They are not considered "unneccessary". But they are at risk of not being funded this year in a way that items in the main budget are not.
It includes pretty much all of the 800K in proposed new spending, some small areas where he thinks penny pinching might get them by, and some things that--as I see it--one can argue are not as essential to a "thorough and efficient education" as others, where "thorough and efficient" refers most strictly to delivering classroom instruction in the core curriculum.
What else could fit in that last category is definitely a "judgement call". fringe suggests some other options. Those judgements are what the current discussion is about.
Finally, you are correct--the major components of the overall increase are "people costs" and under the terms of current contracts (and the need to stay competitive with other districts) those increases are due to "hard" constraints. We can't spend less (reduce pay or raises or benefits) without cutting positions entirely.
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bobk
Supporter
Username: Bobk
Post Number: 4751
Registered: 5-2001
| | Posted on Tuesday, February 24, 2004 - 9:47 am: | |
As usual Super H has the musical program on the table, along, new this year I think, the sports program at CHS. I wish that he had thrown at least one Assistant Super and a couple of administrative assistants in there. I can hear the uproar now. 
Julia, your summary of the rather bizzare way school budgets are handled in NJ, with a cap that isn't, was about the best I have read.
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lumpynose
Citizen
Username: Lumpyhead
Post Number: 719
Registered: 3-2002
| | Posted on Tuesday, February 24, 2004 - 10:44 am: | |
With the all the info that JBurch has, it seems she is already on the BOE. |
jfburch
Citizen
Username: Jfburch
Post Number: 1308
Registered: 6-2001
| | Posted on Tuesday, February 24, 2004 - 10:46 am: | |
Nah, I've just waded through the Budget 101 stuff and gone to a couple of public meetings. |
jfburch
Citizen
Username: Jfburch
Post Number: 1309
Registered: 6-2001
| | Posted on Tuesday, February 24, 2004 - 11:39 am: | |
And, bobk, if one accepts the idea (in my formulation) that "thorough and efficient" refers most strictly to delivering classroom instruction in the core curriculum, one could certainly argue that some administrative costs are not as essential as other costs. Though they might not necessarily be any less valuable or desirable than music instruction. Back to the judgement calls.
I assume that the administrative staffing report will be relevant here, though I haven't seen it. |
mellie
Citizen
Username: Mellie
Post Number: 410
Registered: 4-2002
| | Posted on Tuesday, February 24, 2004 - 1:58 pm: | |
I am confused -if the pay rise %age is most of the increase, and that is known in advance, are you saying the cap fails to recognize that ?
By the way, good summary. I did not get that from the B101 stuff.
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jfburch
Citizen
Username: Jfburch
Post Number: 1310
Registered: 6-2001
| | Posted on Tuesday, February 24, 2004 - 2:40 pm: | |
Yes, the cap does not recognize the size of the increase in salaries.
It is set--statewide, for all districts--to allow 3% inflation with some minor possible adjustments (district specific) for increases in enrollment, transportation costs, and extraordinary special ed costs. This year it might (or might not) include some adjustment for increases in health benefits and general insurance.
Education costs (largely salaries and benefits)--all over, at any level--rise faster than cost of living. This is why holding an education budget flat amounts to a cut.
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jfburch
Citizen
Username: Jfburch
Post Number: 1311
Registered: 6-2001
| | Posted on Tuesday, February 24, 2004 - 2:46 pm: | |
(And, minor correction, fringe is right in that the total of the "new spending" items in the list is about 1.5 million, not 800K as I noted above.
800K is the *net* cost of the proposed budget changes, but some of the new items replace, or at least correspond to, proposed cuts, so the amount that would end up in the special proposal is closer to the total new spending, not the net.) |
Reflective
Citizen
Username: Reflective
Post Number: 322
Registered: 3-2003
| | Posted on Tuesday, February 24, 2004 - 9:23 pm: | |
Sorry, but I don't consider a $700,000 difference a minor correction.
Unless you are the BOE or the super, and the $700,000 comes from the taxpayers.
In this budget, with all its delay and undisclosed items, it is vital that terms such as New Spending be clear and correct.
Thanks Fringe for being correct on these difficult budget matters. The BOE sure isn't. |
jfburch
Citizen
Username: Jfburch
Post Number: 1313
Registered: 6-2001
| | Posted on Tuesday, February 24, 2004 - 9:31 pm: | |
(The BOE is perfectly clear. The error was mine in my 9:38 am post where I wrote of the composition of the possible separate proposal list.) |
johnny
Citizen
Username: Johnny
Post Number: 834
Registered: 5-2001
| | Posted on Tuesday, February 24, 2004 - 9:50 pm: | |
New budget year, same old tricks from Horoshak.
How did he get a contract extension? |
fringe
Citizen
Username: Fringe
Post Number: 298
Registered: 5-2001
| | Posted on Wednesday, February 25, 2004 - 8:45 am: | |
I see there is a demand for a graduate course on the school budget. Here's a course brief.
In 1995 Governor Whitman barely won reelection over her then unknown rival, Mayor Jim McGreevey, because of uncontrolled property tax hikes. The following year saw the passage of a new educational law, CEIFA, the purpose of which was to get control over education spending (the largest component of property taxes) by limiting the amount of revenues a school district can raise to the inflation rate or 3% per year whichever is greater.
The first calculation in budget building is the determination of the Maximum Permitted Net Budget Before Adjustments - the previous years budget approved by the BOSE multiplied by 1.03.
HOWEVER, the law also provided certain loopholes entitled Spending Growth Limitation Adjustments (SGLAs) granted by the state for items such as enrollment increases, transportation (courtesy busing portion), special education, capital outlay, and new school costs.
Last year, after some serious wrangling including the rejection of the BOE's initial proposed budget by the Essex County Super, SGLA's raised the District's permitted budget by ~$875,000 or 1.2%.
The other major CEIFA loophole is the Separate Proposal or Special Question. Districts desiring to spend more than the Max permitted Net Budget (sometimes called the Max T&E Budget) may do so by submitting items not deemed to be necessary for a thorough and efficient education to the BOSE as separate items upon which the BOSE can exercise line item veto.
The SGLA's and approved Separate Proposal items are added to the Maximum Permitted Net Budget Before Adjustments and the total becomes the basis for the following year's computations.
Prior to CEIFA, the BOSE voted on the budget as a whole. A rejection by the BOSE was essentially meaningless as the BOE could and did appeal such rejections to the NJ Education Commissioner. To my knowledge, such appeals were always upheld and the full budget reinstated.
The primary change contained in CEIFA was to make votes on Separate Proposal items not appealable to the State. Hence the comment Monday night describing the decision process on whether to place programs/services in the Max T&E Budget or the Separate Proposal - "Is this something we're willing to loose."
Contrary to the conventional wisdom posted above, almost every program/service can be seen as T&E or not. There are actually very few items required specifically by NJ statute. Yes, there are the Core Standards, but the state does not mandate class size. There are requirements for remedial and advanced programs, but no requirement on how they are to be delivered. There are diversity requirements, but no requirement for busing. And the list goes on.
Consider these examples;
* NJ requires instruction of a World language in elementary grades. It does not specify how that instruction is to be given. Two years ago this District hired 4 teachers for this purpose. Last year, because of budget pressures, the administration described this as the Cadillac approach" and opted to eliminate the jobs and use video instruction instead. On the last evening, after "Candidate for higher office" Huemer's speech, the 4 teachers were included in a spur of the moment separate Separate Proposal on a motion by a BOE member even though the administration had never included them in any of its proposals.
* Three years ago Super H placed $150,000 of utilities into the Separate Proposal that was voted down by the BOSE. Are lights necessary for a T&E education? Later when the BOE tried to fund this from the "Free Balance," a protest with the NJ commissioner resulted in large legal fees to the district and a recision of the resolution. Was the light bill eventually paid? Under the table.
The simple fact is that what one person regards as an absolute necessity, another sees as a luxury item. And it is the nonappealability of Separate Proposal votes that caused Super H to describe it as political. It is THE insiders issue of current school budgets.
No one wants to see his/her pet program put on the Separate Proposal ice flow. While very few items have ever been rejected, and the impact on budget growth has been significant, the possibility of rejection remains. This year with some BOSE members vowing to hold the overall tax increase to 5%, as compared to a 9% projected tax increase in the initial budget - 5.5% of which relates directly to the ~$4 million Separate Proposal, the stage is set for some real hardball politics.
While it may appear that the final budget vote does not occur until the end of March, in reality the crucial vote is on March 8 when the BOE approves a budget to send to the County Super. After that date the BOE can decrease but not increase the items in the Separate Proposal - assuming the County Super approves the budget (see the discussion of Elementary World language above).
From the March 8 proposal will be a telling measurement as to the size of Super H and his key BOE supporters' cajones.
Between now and then, the behind the scenes lobbying and maneuvers will be at the highest level of the year.
I, for one, would like to know what Ms. Burch and other potential BOE candidates would put in this year's Separate Proposal.
JTL
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critter
Citizen
Username: Critter
Post Number: 22
Registered: 5-2002
| | Posted on Wednesday, February 25, 2004 - 6:35 pm: | |
Perhaps this point was already made and I just missed it, but another important consideration when placing items on the separate proposal is that once a line item is put on the separate proposal it can never go back into the T&E budget. |
Reflective
Citizen
Username: Reflective
Post Number: 323
Registered: 3-2003
| | Posted on Wednesday, February 25, 2004 - 7:20 pm: | |
To all readers of this thread:
Fringes' post at 8:45am this morning deserves re-reading, and is a mandatory point to understand our budget dilemma.
Believe it or not, very few people county-wide or statewide understand the nuances in his post.
Our Super does, and it is a key reason why the line item detail is missing, delayed and why we all get in a dither at one minute to midnight over programs.
We fight among ourselves, and he wins.
By the way, ask Huemor, Profetta, Grodman and Pettis if they understand Fringes' post and ask them how they will address these issues as members of the BOSE. |
fringe
Citizen
Username: Fringe
Post Number: 303
Registered: 5-2001
| | Posted on Thursday, February 26, 2004 - 8:31 am: | |
Contrary to the conventional wisdom above and previous statements by the Business Manager, at Monday's meeting it was stated that the District's in-house legal counsel and the NJDOE have determined that items which appeared on a previous Separate Proposal can be placed there again.
This is instructive in considering the workings of budget building - for example, the Alternative Program at Montrose began life as a way to remove the 50 most disruptive students from CHS at a cost of ~$500,000 per year (marginal cost per student $10,000 v CHS of ~$3,000). This was approved and passed as a Separate Proposal item in the 1999-00? budget. By normal process this grossed up the 2000-01 Net T&E Budget before Adjustments by $500,000 x 1.03. It has had the same effect on every budget since - even though the program's mission has changed to assisting the attendance-challenged.
Under the new reading, the program could again appear as a Separate Proposal item without a reduction in the already existing Max T&E Budget before Adjustments. If it did and was passed, in the year's following the budget would be built on the original $500,000 compounded at 1.03 + the second Separate Proposal amount (say another $500,000) also compounded at 1.03. Result - the budget would contain $1,000,000 in authorized revenue (taxes)compounded at 1.03 for an expense of $500,000 - all for a program not doing what the citizens were told it would do.
This is still a hypothetical. There are actual examples that are more insidious - Courtesy Busing for example. According to the District's read of the regs, it is allowed to adjust the Max T&E budget each year not by the incremental cost of busing additional students the district is not required to, but by the entire actual cost of all non-remote students. Thus, last year the District received state approval to adjust the Max Budjet upwards by ~$550,000 for non-required busing, but the Max Budget already included ~$2 million for this same purpose from previous years' SGLAs. Net net - the 2003-04 budget contained authorized revenues for non-required busing of ~$2.5 million when actual expenses were ~$550,000.
Now one might argue that these are justifiable tricks needed to meet the budget requirements without risking too many items in a Separate Proposal. But consider that in each of the last 10 years the District has actually underspent its budget - significantly. Last year the District spent 97% of projections. In the decade it has been as low as 95%. Multiply $60,000,000 by .05 to determine the amount that went to the "Free Balance" (slush fund).
JTL
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