By Dina Samfield
SHIRLEY -- In a continuing discussion about the Ayer-Shirley Regional School District's fiscal 2015 budget, Superintendent Carl Mock told the School Committee last week that he had invited the two towns' boards of selectmen and officials from Nashoba Valley Technical High School to a meeting on Feb. 18.
He also said he is working on arranging a meeting of the Regional Leadership Advisory Group for Tuesday, Feb. 25, at the middle school. The leadership group includes Mock, school district Director of Finance Evan Katz, the two towns' finance committee and board of selectmen chairs, the town treasurers and the town administrators.
Mock said he expects the leadership meeting to include a broader discussion of the towns' and school district's fiscal realities, sustainability and directions.
School Committee Chairman Pat Kelly noted that he wants to "start looking farther down the road so it is not a crisis each year for planning each specific budget."
A tale of two towns
Katz shared four pieces of information that illustrate some of the complexities of resolving a regional school budget with two distinct municipalities. He began with the biggest piece of the assessment determined by the state, the Required Local Contribution.
The RLC is essentially a measure of how much local tax revenue a city or town can reasonably raise and dedicate to the operation of its schools. Local ability to contribute to the RLC varies widely based upon the incomes and property values of different cities and towns. It is also based upon where each town's students attend school. Both member towns have students attending Nashoba Tech.
The chart Katz shared shows the Ayer and Shirley RLCs from fiscal 2007 to the governor's proposed budget for fiscal 2015.
Because in 2007 Ayer was above the state Department of Elementary and Secondary Education (DESE) target RLC set by the state, its target amount increases less each year and Ayer's RLC is rising slowly.
"Shirley, on the other hand, was below its target, so its RLC increases are a little bit bigger," Katz explained. The DESE target is gradually closing the gap, and by fiscal 2015, Shirley's RLC will be only 3 percent below its target of $4,804,031; Ayer's will be 4 percent above its target of $6,857,602.
"The RLC is just the base," Katz said. Chapter 70 education aid from the state is then determined by filling the gap between a district's RLC and its foundation budget, which is the state's formula for spending required to operate a district.
"The NSS greater than the RLC is the next step," Katz explained. It includes operating expenditures and other costs, such as insurance, maintenance and administration. It excludes nonappropriated funds, such as grants, revolving funds, capital spending and transportation.
Accounting for the phase-in
The second chart Katz introduced shows fiscal 2015 assessment increases based on the NSS plus the five-year "phase-in" of NSS>RLC that will bring Shirley to the target cost share with Ayer, which was paying a much higher percentage RLC when the region was formed.
"As part of the five-year transition, Ayer would save $97,496 and Shirley pay $97,496 more in NSS" in fiscal 2015, Mock said. "That plus the RLC leaves a $44,402 increase for Ayer and $234,415 increase in assessment for Shirley."
"That is a far cry from the budget we have proposed," Mock continued. "That is less than half of what we set. That increase would be just for personnel and salaries and insurance (medical costs.)
"So Evan added increments of $100,000 to show how it gets shared in the phase-in NSS apportionment, roughly 64/36 Ayer/Shirley. The $761,075 cumulative total would be just a level-funded budget to do what the district does now," Mock said.
For that total, the split would be roughly $353,047 for Ayer and $408,028 for Shirley.
In the preliminary proposed fiscal 2015 budget, however, the split is roughly $674,327 for Ayer and $588,748 for Shirley, for a cumulative total increase of $1,263,075.
"The 64/36 gap will close over the years, based on some assumptions that are reasonable but may not get played out," Katz said.
The third chart was the "ASRSD Assessment Increase Breakdown" fiscal 2012 through fiscal 2019. The document shows the combined Ayer RLC, phase-in reduction and NSS>RLC totaling $313,868 in fiscal 2015.
For Shirley, the fiscal 2015 RLC, phase-in increase and NSS>RLC total $385,979. That brings the district total to $699,847. The split would be 60/40 by fiscal 2016, and 56/44 by fiscal 2017, the last year of the phase-in.
That would mean about a 50 percent increase in Ayer's tax levy and a 100 percent increase in Shirley's tax levy every year, said Mock. The increases would be about $700,000, or about 3 percent, for each year for the district.
"The best-case scenario you are looking at is two to three very difficult years for Shirley. We talked some about it last year, and it was acknowledged that it was a harsh reality, but there is still an imbalance as to what the two towns will bear," Mock said.
A nine-town comparison
The fourth chart presented to the School Committee showed the percent of total municipal expenditures that nine area towns, including Ayer and Shirley, spend on their schools. The data was collected by the state Department of Revenue.
Shirley had the lowest percentage the first two years and came in seventh for 2012. Ayer was ranked eighth the first two years and ninth in 2012. In 2011, the percentage of school expenses compared with municipal expenses actually dropped for the two communities.
"As a resident new to this area, and having heard of a lack of resources available to the school," Mock said, "I see that reflected here. In 2012, Shirley's expenditures for the schools jumps, but Ayer's drops."
In the current budget scenario, said Mock, "the town with the weakest municipal budget limit could strangle the schools.
"You have a regional school district but are not really tapping regional resources. It is a regional entity that is tapping the municipalities differently," he explained. "It is worth having the conversation about how you address that."