Preliminary budget picture for 2012-13
March 23, 2012 -
A preliminary view of next year’s budget shows that at this point
in time, in order to balance the 2012-13 budget, the Goshen Central
School District will need to close a $1.1 million budget gap.
This year’s budget challenges include projected
increases in contractual salaries and retirement costs as well as health
insurance premiums, the loss of Education Jobs Fund monies, and
essentially flat state aid – coupled with the constraints of the new tax
levy cap law.
Challenges of rising costs, flat state aid
Although the state has not adopted its budget for 2012-13, based on the
Governor’s proposal, the district is slated to receive an increase of
about $214,000 in state aid for next year. However, federal funding
under the American Recovery and Reinvestment Act of 2009, known as the
Education Jobs Fund (EJF), will end on June 30, 2012. The district’s
loss in EJF monies – or $634,341 – was not included in the projected
state aid figure, and losing these funds turns what appears to be an
approximate $214,000 gain in state aid into an approximate $420,000 loss
in aid over the current year.
Contractual salary obligations, coupled with the
loss of EJF monies, caused a larger than normal jump in the salary
amounts listed in the general fund. Goshen has five self-contained funds
within a school district: general, capital, trust and agency, cafeteria
and special aid. (The public will vote on the district’s general fund
during the budget vote on May 15). In 2011-12, 7.2 positions were funded
by EJF as part of the special aid fund. Because the EJF funds are being
discontinued, these positions will be transferred to the general fund.
In addition, rising costs for retirement
contributions and health insurance are driving up the budget; however,
the district has little control over these costs – the first being
dictated by the state and the second by the costs of health care as an
The impact of the tax “cap”
The district’s tax levy limit is calculated using an eight-step formula
provided by the state. However, there are certain exemptions to the tax
levy limit, including some pension costs and local capital expenditures.
These items are added to the tax levy limit in order to arrive at the
maximum allowable levy.
As a result, a district may propose a budget with a
tax levy that is higher than its tax levy limit and still be within its
“cap.” Goshen’s maximum allowable levy, after adding $1,007,236 in
applicable exemptions, is $41,581,628 or a 2.2 percent increase over the
current year’s tax levy. This is the highest allowable tax levy that
Goshen can propose in its budget while only needing the approval of a
simple majority of voters (more than 50 percent).
It is important to note that although the tax levy
cap law has constantly been touted as a “2% tax cap,” it does NOT in
fact restrict any proposed tax levy increase to two percent. It also
does not limit your tax rate or your tax bill increase to two percent
for next year.
Learn more about the tax levy cap
Working to fill the “gap”
Under the tax levy cap legislation, school districts are permitted to
propose a tax levy that is higher than its maximum allowable levy;
however, a super majority of at least 60 percent of voters must approve
the budget in order for it to pass.
To date, the district has no plans to propose a
budget above its tax levy limit and therefore must work to fill its $1.1
million budget gap to balance the budget.
As of the Board of Education meeting on March 19,
district officials are considering the following in order to fill the
A reduction of approximately 5.6 FTE teaching
positions and 1.0 FTE aide position
A limited reduction in supplies, equipment and
contractual agreements to outside vendors within the Buildings &
A limited reduction in BOCES programs, including
the GO Program, Restart and Intensive Day Treatment (IDT)
A limited reduction in coaching salaries,
supplies and contractual agreements within the Athletics Department
The transfer of two special education teacher
positions from the general fund to the special aid fund
A limited reduction for tuition and one-on-one
nursing within the Special Education Department
Eliminating the 5 p.m. bus run and leaving a
retiring monitor’s position unfilled
Another possible reduction lays in the hands of the
Governor, who had originally proposed that school districts pick up part
of the county’s preschool special education costs. It is unknown as to
whether this will come to fruition until the state’s budget is adopted
for next year, but could become a reduction.