The First Referendum Failed... What Happens Next?

On April 29th, the Legislative Council held a special meeting to discuss the failed referendum.  The Legislative Council Chair invited the Board of Finance, the Board of Selectman and the Board of Education.  At this meeting, the First Selectman offered $503,000 worth of potential reductions for the council’s review. The details are as follows:


1.Reduce Debt Service by $200,000 
Debt service savings would be achieved by selling the portable classrooms that are currently at the high school. The superintendent confirmed they would become available in January of 2011. There was some concern airedabout whether or not we should keep them to use at other schools, as well as the concern that adding revenue this year would present a larger deficit to fill next year, but ultimately this was accepted as an increase in revenue.


2.Reduce Health Insurance by $125,000 
Additional health insurance savings is a result of continued negotiation with providers.


3.Reduce Contingency by $100,000
There has been a lot of discussion about contingency on the town side when there is no contingency on the school side. First, it’s important to understand that any money requested by the selectman from the contingency account needs to be publicly vetted and approved prior to the use of the funds by both the Board of Finance AND the Legislative Council. This makes for a very visible and public process for any requests outside of the normal operating budget.


4.Reduce Public Safety by $78,000
This reduction represents the salary and benefits of one police officer. At this time, there is a request by one officer for a leave of absence to attend the state police academy.  That request still needs to be reviewed and granted by the police commission, but the funds have been removed from the budget regardless of that action.


On the school side of the budget, the Superintendent informed the council final negotiations for health insurance had brought the proposed rate down to a 2.05% increase over the current year. The final savings are not yet determined and are conditioned on numbers of persons covered in the various plan options. Ultimately, those savings could be as much as $900,000.


Negotiations, which continue well after the budgets are presented, pose serious challenges as costs can only be estimated on the information on hand at the time budgets are presented. The Board of Finance Chair learned the state has estimated our town’s reimbursement for Excess Cost associated with Special Education will be 82% to 84% next year, the same as is for this year. This new information means revenue could be increased an additional $57,000


As of today, the school district commodity savings from ongoing negotiations stand as follows:



Also, according to the Board of Education Chair, there may be an additional $200,000 savings in early retirement.  This means the original gap of $2,500,000 has been reduced to $601,996. As of today, the school district’s request for next years budget, as recommended by the Board of Finance and reduced by the Legislative Council, represents almost a $700,000 increase over the current year.


After much debate, $503,000 was removed from the municipal budget while potential savings for the school budget was left intact.  This action brings the proposed tax increase from 2.99% down to about 2.44% while effectively increasing the school budget.


What’s next?


This budget will be presented to the voters for their approval on Tuesday, May 18th.  If the vote is successful, the Board of Education will need to decide how to meet the $601,996 gap between what has been requested and what has been provided. Since neither the Board of Finance nor the Legislative Council has any authority to make line item reductions, we won’t know exactly what will happen until then. It is our hope the Board of Education will not support the scenarios to increase class size and eliminate after-school activities that have been floated by the Superintendent and the Board of Education Chair.  We Republicans believe these scenarios should be the last options to be considered - not the first.  Your thoughts on this topic can be shared with the Board of Education members as they deliberate.


We Republicans feel strongly that staff and after-school activities should be preserved unless the enrollment or modified programs dictate change.  Here are some of our suggestions so that necessary staff positions can be preserved:


See our complete list of suggestions at:

http://newtown.patch.com/articles/republicans-it-is-a-fair-budget-it-is-a-reasonable-budget#pdf-402787


We would like to address a few misconceptions.  Here are our top ten:


10.  “The town is hiding funds for bridges in the capital road plan”
Completely false.  
Did you know the line item for bridges was removed from the operating budget and then moved to the capital improvement plan?  The following link will show you the budget details:
http://www.newtown-ct.gov/Public_Documents/NewtownCT_Finance/FY10-11_BudgetDetail.pdf

9.  “Town Government isn’t Listening and Won’t Compromise”
Did you know the initial combined budget was an overall increase of almost 6%?  Did you know the current overall increase is 2.4%?  Isn’t that a compromise?


8.  “Education Gets Unfairly Cut”
Did you know education funding for next year as currently proposed represents a 1.02% increase over the approved 2009-10 budget?  Did you know the municipal side of the budget represents -1.21% over the approved 2009-10 budget?


7.  “Pay to Play” Money Goes to the Town - Not Education
Did you know the 2010-11 budget shows the parents will be expected to contribute a total of $84,800 through “Pay to Play” fees? Did you know the budget for 2010-11 High School Interscholastic Sports and Student Activities is $720,017? All general revenue for the town goes into the “general fund” and all operating expenses are paid from dollars in this fund.  Clearly, most of the expenses associated with athletics are being funded by taxes. Until revenue exceeds expenses, there is no possible way that parent’s money is being spent anywhere else.


6. “Use More of the Fund Balance To Offset Taxes”
Did you know $1 million is being used to offset taxes for next year?  Did you know if more than $1 million is used, we would dip below our minimum requirement of having at least %5 of expenses in our savings account?  Did you know local towns like Redding, Monroe and Trumbull have been downgraded for using their fund balances for operating expenses?  This account is meant for one-time emergencies, such as a fire, not to fund year over year operating expenses.  We need to learn to live within our means.  The following data on the Town’s website shows analysis of using more of the fund balance.  Select “Fund Balance Analysis 05/2010” on the following web page: 

http://www.newtown-ct.gov/Public_Documents/NewtownCT_Finance/index


5. “Debt Service Savings is only Applied to the Municipal Budget”

True!  Did you know the municipal budget carries all of the debt for both the school and municipal projects (including the $38 million High School Expansion)?  Did you know the municipal budget includes $9,606,927 in debt payments? The municipal operating budget is only $28,096,117.

4.  “The Legislative Council is Preventing the Inclusion of Advisory Questions”
Did you know our charter does not currently allow for advisory questions?  Republicans fully support charging a charter revision committee to review the use of advisory questions or any other tools available to determine voter intent, understand the effectiveness of any options and determine if they are right for Newtown.

3.  “Contingency is the Selectman’s Slush Fund”
Did you know the contingency account can only be used with line item requests that come from the Selectman and get approved first by the BOF and then by the LC in a very public process meant to provide checks and balances.  Did you know the Town has offered to facilitate the same type of contingency for the schools?

2.  “Education Reductions are Cast in Stone”
Did you know the BOE has stated there will be no final decisions until a budget is passed? Any scenarios, being floated, are suggestions only – in the end, the Board of Education makes the choices.

1.  “Definition of an Education Supporter”
Newtowners are hearing that in order to be an “Education Supporter” you must support requests for education funding without question. We believe the education system here in Newtown is very good. We have excellent administrators and teachers. Unlimited funding does not directly correlate to excellence.


All of the above issues were discussed at a press conference held on May 12th:

Republican Council, School, Finance Leaders Advocate For Budget Passage

http://www.newtownbee.com/


Republicans: 'It Is A Fair Budget, It Is A Reasonable Budget'

http://newtown.patch.com/articles/republicans-it-is-a-fair-budget-it-is-a-reasonable-budget


Republicans see no need for layoffs

http://www.newstimes.com/local/article/Republicans-see-no-need-for-layoffs-484587.php


What do Republicans Think?

The original Board of Education budget reduction of $2.5 million was recommended in part to account for commodity savings that always change after the Board of Education presents their budget.  The most prominent example of this is Health Insurance.  This year’s health insurance estimates went from a projected increase of over 20% to an increase of 2.05% saving.  This savings came from the diligent and cooperative work of both the municipal and education boards in rethinking our health insurance options and moving to self-insurance.


We Republicans believe education is important.  We believe the balance of the reduction, after commodity savings, should be spread out equitably.  No one group or program should bear the brunt of the reduction.  We believe staff reductions should only be made in the event that enrollment declines or educational programs are revamped.  In the end, the downward trend in enrollment, coupled with the new economic realities we face, demand a change in how we do business. We have shown reasonable reductions in requested funding for items that do not directly impact programming for our children.  Structural change is required in the long term to bring our town into the 21st century. There should be no sacred cows and serious thought needs to be given to all available options.


Vote Yes at the Referendum

Tuesday, May 18th

Newtown Middle School

6am to 8pm