kitchen table math, the sequel: Peter Meyer explains New York's contingent budget law

Tuesday, March 15, 2011

Peter Meyer explains New York's contingent budget law

at the Irvington Parents Forum:
[S]tate law says that school districts are allowed to increase their budgets by up to 120% of the rate of inflation. I forgot the exact formula, but we've been informed (again, I'm on the BOE of a small (2000 kids) upstate district) that the CPI is 1.6%.

This might not mean much to Irvington, but to a poor (median family income up here is right around $30k and over half our kids are free and reduced lunch) district where more than 50% of revenues come from State aid, it means something close to a fiscal disaster.

Cutting to the chase, if we, the BOE, wanted to (the law says a board may vote to go directly to contingency if it wants, no vote needed!), we could increase our budget (it's about $40 million) by the 1.6% and make the local taxpayers make up the loss of state aid (projected to be over a million bucks) and loss of federal Edujobs money (another million and change) by having us property owners (all ten of us!) shoulder a 14.9 percent property tax increase. In that scenario we only layoff about 15 staff (including 7 teachers). There are other scenarios, none of them too pretty (and I'm one who believes pretty firmly in the proposition that more money does not buy a better education).
here's a followup:
The interesting thing, of course, is that the contingency law never anticipated the current economic crisis. The board COULD raise taxes 15% if it wanted to -- it has the legal right to do it. Would it? Probably not. So, no there are lots negotiations -- and lots screaming and yelling in executive session and elsewhere -- about whose axe gets gored. I think 4% tax increase scenario resulted in something like 70 layoffs. And yes, a salary freeze saves about 20 jobs (depending, of course, whose job).... It ain't pretty and it ain't too much fun....
It could always be worse, I suppose.

At least New York doesn't have a minimum budget requirement.

1 comment:

gasstationwithoutpumps said...

It could be worse. You could be in California and need a 2/3 popular vote to raise taxes (and then only per parcel taxes, not taxes proportional to property values).