SHIRLEY -- In a repeat of the presentation he gave at the Jan. 23 Ayer-Shirley Regional School District School Committee meeting, school superintendent Carl Mock told the Shirley Finance Committee how the state's new formula, designed to finish the Chapter 70 equity reforms of 2007, has changed the fiscal 2014 assessments for Ayer and Shirley.
Because Ayer has been paying a significant amount above the Required Local Contribution over the past six years, its RLC is now on a par with the state target figure. Shirley, on the other hand, has been paying significantly less than the Dept. of Elementary and Secondary Education's target figure for RLC. Its fiscal 2014 RLC is projected to be $202,963 below the DESE target.
As a result, the assessment for Shirley will increase by $260,699, which changes net school spending above the local contribution.
The other cost driver in the fiscal 2014 school budget, said Mock, is a $320,000 increase in special education costs, including $185,000 for special education transportation.
"That totals about $550,000 in the red with regard to special education costs," said Mock.
Some good news is that the actual cost of borrowing the first $4 million for the bond for the high school renovation will be about half of what had been anticipated, due to low interest rates.
"Ayer's adjusted amount for their relative proportion of the middle school debt is more than what the district will have to pay for interest," Mock said.
"So whatever is left will go for the purpose of having those monies for Shirley. When they get to the point that their portion of the debt comes due, they can apply this.
"That stabilization money goes for Shirley's use to defray the cost of the high school project. That reflects the money that is the adjustment for the high school debt for Ayer."
The RLC Problem
The school budget presented to the school committee on Jan. 8 reflected no change in the RLC, because at that time it was yet to be determined.
Now that the new formula for RLC is out, Shirley's assessment is $165,390 higher than anticipated in the Jan. 8 budget; Ayer's is $209,590 less.
"The RLC has really thrown the whole thing into kilter," said Mock, referring the committee to an assessment change analysis showing that for Shirley, the increase form fiscal 2012 to fiscal 2013 was only about $6,300.
"But for fiscal year 2013 to 2014, you're looking at about $260,000," he said.
His explanation? Some communities are making greater efforts than expected, and some are making less effort than expected. Starting in fiscal 2007 there was an attempt to bring those into parity.
Mock said that it is his understanding that the state "sort of set aside the progress to be made, so it backed off that effort to bring the RLC and the DESE targets into play.
"But next year it appears that they have gone back to doing that with a pretty substantial increase for Shirley."
"It goes back 10 to 15 years ago," said FinCom Vice Chair Mike Swanton. "Shirley got more than our fair share of state aid. For whatever reasons, we did very well with Chapter 70 relative to a lot of other towns in the area."
"The state giveth, and the state taketh away," he said.
The $555,590 increase for Shirley over the fiscal 2013 budget comes from the RLC increase of over $260,000, about $114,000 in net school spending above RLC due to the phase-in to get Shirley on a par with Ayer, another $94,000 in net school spending over the RLC, and about $86,000 in other expenses, mostly related to transportation.
"If you look at your new growth you can only raise about $300,000," Mock said of the town. "And if all of that went to the school you would have to take $255,000 out of Shirley and maintain the proportionately with Ayer.
"Then next year you are at a 68/32 split, a little more than two dollars for Ayer per dollar Shirley needs, which brings the budget back to this year, which is already $550,000 over," said Mock.
Special Education Costs
With nearly half of the transportation costs of $1,209,483 in fiscal 2014 going for special education, Mock said that is important for the district to continue improving its therapeutic programs.
The district added back in the $100,000 taken out of last year's budget for its therapeutic program at the high school.
"The program needs to be more effective. If we don't do something at the high school, I can guarantee you that our out-of-district placements will go up," he stated.
"I desperately want to get the kids who are out of district back. There is no question that the cost is a lot per kid," he said.
"Extraordinary special education costs can really tip the budget, based on some very small changes in student population," said Swanton.
Mock reported that only eight students accounted for the more than $800,000 increase in the budget. Just one student cost over $185,000, "so that is the magnitude you are talking about with the out-of-district piece," he said.
"We as a society have a moral obligation to take care of the people who live in our community What we struggle with is how do we fund it in what is essentially a zero sum game," Swanton observed.
The Quest for Sustainability
Mock said that his main concern was on the Chapter 70 side. "This is two years in a row that we won't get very much of an increase in state aid, and all that is going to go on the assessment side," he stated.
"Everybody knew that this would come home to roost," said FinCom member Bob Schuler.
"But when people are presented with this they will be aghast and say, 'Where did this come from?' replied Swanton. "They won't make the connection over what happened six years ago."
Kolarik suggested looking into a method of appealing the amount of the RLC to have it recomputed or adjusted.
"Whatever is going to happen is going to have to happen rather quickly," said Mock.
"You are really talking about the sustainability of the region. From where I sit, we are at a very critical juncture here in terms of the sustainability of this whole affair, and I'm not sure if everybody understood how much it would take to get us up and running."
"My pitch is that we went into this with a very slim margin to begin with, so in terms of going forward, I make a pitch to get the leadership group together. Ayer has to be in on this, and our legislators have to be there.
"We need to get people up to speed on what the situation is and what the drivers are. We have to get the emotion out of the situation we find ourselves in, and the sooner we get past that, the sooner we can get it resolved," Swanton concluded.