I have written several letters to explain the West Windsor-Plainsboro school budget to the taxpayers. It seems that the best insights can be found in the minutes of the district’s finance committee. The following are from the finance committee meeting of November 15, 2011, which are available on the district website.
“2012-’13 budget: At the last committee meeting, it was agreed that expenditures associated with community education’s utilization of facility personnel and energy would be phased in over a four year period; next year about $230,000 will be charged to CE. It was agreed that the capital spending level in the annual budget should return to the $1.5 million level. These decisions were affirmed.
“In addition, there was discussion on the $8.3 million excess fund balance to be designated for 2012-’13 budget. Most of the discussion focused on tax relief, the greater the tax relief, the greater the burden on the Board of Education to curb spending if that amount cannot be sustained in future years; this requires a willingness to cut programs to match any imbalance of future years. It was mentioned that the auditor had also noted this risk and suggested that consideration be given to legally permissible applications of these dollars such as adding to the unemployment compensation fund, capital reserve and maintenance reserve. The committee suggests adding $0.3 million to unemployment, $1.5 million to capital reserve which then applies about $6.5 million for tax relief in the 2012-’13 budget.
“The budget discussion moved to the 2 percent general fund tax levy increase topic; the current law allows the district to raise the general fund tax levy up to 2 percent plus a number of automatic adjustments. In the last budget cycle, this theoretically allowed the general fund tax levy to potentially increase by 2.27 percent; with the budget defeat, the increase came in at 1.9 percent. Several years ago, the district applied the tactic of raising the general fund tax levy to the maximum and using any available dollars to reduce the debt service tax levy, keeping the overall tax levy increase relatively moderate. Compounding is powerful and while not going to the maximum may be a small number of dollars in any one year, over a number of years the impact to the budget can be large.
“The committee suggests that the early focus of budget scenarios looked at two options: the typical 2% plus automatic adjustments in the general fund tax levy; and, a second option in which the total (general fund plus debt service fund) tax levy increases no more than 1.25%. Should the second option result in a shortfall in any budget period due to volatility in items such as benefits, special education or state aid, the BOE must be prepared to reduce spending, possibly on short notice. In addition to the usual pressures on the budget for increased expenditures for salaries and health benefits, there are needs/requests for additional dollars for: the FSA; continuing programs without Title II dollars; charter school; outdoor education; providing Title I type services to non-Title I schools; and PERS, among others. As a zero sum game, the more dollars for existing and added programs, the fewer dollars are available to be applied for contract negotiation use.”
That’s the end of the minutes, now to offer my observations:
The Community Education program operates within a separate Enterprise fund. It has made a profit in most years and has built a surplus of over $5 million. Last year, the School Board stated that the surplus did not belong to the taxpayers. Now they have admitted that the profit and surplus are due to the free ride on facilities and energy that have been provided at taxpayer’s expense.
The district always talks about prior year spending favorability to be returned as tax relief. These minutes clearly show their creativity in holding on to the surplus and not returning it to the taxpayers. The $8.2 million excess surplus is after the Board moved $1,750,000 into capital reserve in June 2011. Now they want to find even more ways to reduce the amount of surplus to be returned to the taxpayers.
The discussion of the 2 percent cap is also enlightening. They openly discuss the “tactic” of moving money between the General Fund and Debt Service. The net effect is to evade the cap and utilize the power of compounding to maximize the local tax levy.
The 2012-’13 budget clock is quickly running down. The next meeting of the Finance Committee will be held on Tuesday, February 21. The following Tuesday, the School Board will vote on a preliminary budget for submission to the County Superintendent. If you think that our taxes are too high, you should go to those meetings and express your opinion.
Petty Road, Plainsboro
Quentin Walsh is the husband of WWP School Board member Ellen Walsh. The comments above reflect his views and not hers.
He has been invited to speak at the West Windsor Republican Club meeting on Thursday, March 8, at 7 p.m. in the Club Room of the Mercer Oaks facility at 725 Village Road West in West Windsor.