SHIRLEY -- Last week, the Ayer and Shirley Boards of Selectmen and Finance Committees met with the Ayer-Shirley Regional School Committee to listen and to begin working toward a solution to the new school district's fiscal dilemma.
The fiscal 2014 budget discussion began with a presentation by Ayer-Shirley Superintendent Carl Mock. In late January, he said, the governor's budget's impact on required local contributions (RLCs) threw "a huge curveball to at least one of our member towns: Shirley."
The question, he said, "is to what degree is this a shared issue or is this owned by just one or three entities that are in the room."
With the School Committee required to certify its budget in three weeks, he added, "time is ticking."
In fiscal 2013, the Ayer-Shirley Regional School District's certified budget was $58,543 less than that of fiscal 2012. Thanks to revolving funds and grants, the revised fiscal 2013 budget was even less, but did not include the $550,000 in unanticipated special-education costs for out-of-district placements and transportation, Mock explained.
"We had already cut this year's budget so close to the bone there was no wiggle room to cut staff," he said, later adding that the district had already cut eight positions at the end of the last school year.
The current preliminary fiscal 2014 budget of $25,654,925 is an increase of less than one percent over fiscal 2013, with a total assessment for both towns of $14,325,723.
Mock said this was the first time he had ever submitted a budget that was "in the red."
Shirley Finance Committee Vice Chairman Mike Swanton described the Massachusetts Department of Elementary and Secondary Education increase in the RLC portion of the Shirley assessment, in combination with the gradual five-year increase in Shirley's contribution toward net school spending (NSS) over the RLC to equalize its share with that of Ayer (as spelled out in the regional agreement), as a "double whammy" for Shirley.
As a result of the changes, the RLC portion of the assessment for Shirley increased by $260,699, bringing the total change in the fiscal 2014 assessment for Shirley to $555,591, and Ayer's total increase to $239,015, including the towns' fiscal 2014 debt payments for the high school renovation project.
A tale of two communities
Ayer Selectman Jim Fay was the first to reply to Mock's question.
"It goes without saying that it is a shared problem, because we, being both towns, have our children in the schools, and if the schools are under stress, it is a stress to us. So, to me, it is clearly a shared problem," he said.
"I can understand the quandary in Shirley," Ayer Finance Committee Chairman Scott Houde later added. "However, myself, as a member of the Finance Committee and a taxpayer -- we have invested in education and the regional agreement, which includes a $100,000 uptick per year to help Shirley be held harmless, and invested $1.9 million in the middle school, plus what we did for regionalization. That is $2.4 million to help Shirley with their situation.
"There is concern that if things are done in the school budget, that will affect the investments we have made. There is really no room where you can cut the school budget because we have invested that $2.4 million, but risk seeing the quality of education being reduced."
"What does it take to get that (RLC) formula readjusted and what would be the end result of that?" asked Fay.
Citing legal roadblocks, Mock suggested a different option -- a legal process that allows both towns at Town Meeting to reallocate the sum of the RLCs, thereby adjusting the assessment.
He explained that there is a significant difference in the two towns' "combined effort yield," which is an ability-to-pay measure created in the state education formula.
A big com ponent of the RLC, the combined effort yield is based upon both the property percentage and the income percentage to each individual municipality's aggregate property valuation and income.
"As I look at this as a long-term problem, we have two communities who do not appear to have an equalized ability to pay," Mock said.
A stopgap solution
"What I want to know before Ayer decides anything is that Shirley has a plan in place to do something," said Ayer Town Accountant Lisa Gabree.
To that, Swanton explained that while Shirley knew that the state was changing the formula for the RLC, and that Shirley had been receiving a larger share of Chapter 70 money than many other towns, "Now they came back to us with this large (RLC) increase."
His solution: to change the amount of the assessment above the RLC.
Upon hearing his proposal, Ayer Selectwoman Pauline Conley asked Swanton to provide a document showing all of the numbers to everyone seated at the table.
In that document, Swanton later spelled out the details.
The proposal would hold the total amount of the NSS above RLC portion of the fiscal 2014 regional school district assessment constant with the fiscal 2013 assessment.
According to Swanton, this would effectively reduce the total proposed school district fiscal 2014 budget by $335,200, on a total proposed budget of $25,655,000.
Further, said Swanton, the proposal would delay the change in the Ayer/Shirley ratio of the NSS>RLC assessment for one more year.
For fiscal 2014, the "split" on NSS>RLC would remain at the fiscal 2013 level of 72 percent for Ayer, and 28 percent for Shirley, rather than the 68 percent Ayer, 32 percent Shirley split, as proscribed for fiscal 2014 in the regional agreement.
To change this ratio for even one year, he said, both towns would have to vote to amend the regional agreement.
The net effect of the proposal, said Swanton, would be that the school district's fiscal 2014 budget would decrease by $335,200; the Shirley assessment for fiscal 2014 would increase by $347,100 over the fiscal 2013 assessment, as opposed to the $555,600 per the district's fiscal 2014 budget proposal; the Ayer assessment for fiscal 2014 would increase by $112,300 over the fiscal 2013 assessment, (not $239,000); and the rationalization of the Shirley share of NSS>RLC would be pushed out one more year so that it would be "equalized" over six years rather than five.
Upon his oral presentation of the initial outline of his proposal, Gabree was still skeptical.
"I think the only way to sell that to Ayer is for Shirley to have a plan in how you are going to fix yourself long-term," she said.
Shirley Selectman David Swain then laid out some of the strides that the town has made, including grants for long-range planning, potential income from solar energy, and an increase in its stabilization fund.
Mock revealed that there may be some potential savings in health-care costs that could amount to "about a third of that $335,000," but, he said, there are still necessary items that would have to be stripped out of the budget, and there are still lingering inequities between schools that the district is working to resolve.
"We can continue to hobble along for a few more years and make this work, which is not pleasant to any of the three parties around here, but the question is how to solve a problem," said Ayer Town Administrator Robert Pontbriand.
"The Regional School District can further cut its budget but that is problematic to everyone around the table, if we care about the future of the school district, as the town would go the way of the school district."
Pontbriand said there are two realities: substantive and political. If the substantive solution was to cut the school budget, "the political reality is that a lot of parents and students would be very disappointed, and that is not a solution."
Ayer could continue to adjust to compensate for Shirley and the school district for only so long, however, before Ayer could become the limiting factor, along with Shirley, he said.
As increased enrollment would also help to improve the financial situation for the school district, Pontbriand suggested taking immediate action to lobby the towns' state legislators.
Conley agreed and suggested that all those present sign a letter to their state legislators. The majority agreed and the task of writing the letter fell to Pontbriand and Mock.
While acknowledging that Shirley may not be able to pay the $350,000 assessment increase, Conley said Ayer could probably handle carrying Shirley's phase-in for an extra year.
"Last year was a little bit bigger Band-aid. This is just a little Band-aid," she said. "I have to echo what Lisa said ... but we have to figure out how the fiscal inequities can be resolved."
The public hearing on the school budget will be held on Tuesday in the professional development room at Page Hilltop Elementary School in Ayer.