NB: 1. I am a member of
the Hillsborough Township School Board. Opinions expressed here are solely my
own and do not express the views or opinions of the Hillsborough Township
School Board.
2. It is very important
for the community to express their support or opposition to the referendum and
its impact on the school district and taxpayer by voting on Tuesday,
March 12, 2019.
3. This is my personal
assessment of the referendum and should not be construed as instructing the
community on how to vote.
This is the statement I
would have read at the March 4, 2019 Board of Education meeting if the meeting
had not been cancelled.
Here are a few things to
consider whether or not you support the referendum:
1) The $8.1M tax levy
proposal in the March 12, 2019 referendum ONLY covers full day kindergarten
($3M) and maintaining the status quo ($5M). This is a permanent tax
increase. In the future, there will be additional tax levy proposals
to address aging infrastructure and to build a new high school.
FDK has a $3M start-up
cost for the first year (staffing, modular classrooms - note, K students will
be in the main building; support staff / specials are proposed for the
temporary classrooms). The expectation is that by increasing
our student head count via FDK (half day K students are counted as 0.5
student), the district will lose less state aid. However, this is not a
guarantee. Another scenario could be the district spends $3M on FDK
and does not get its expected aid, thereby putting the district in worse
financial shape.
Finally, permanent space
for FDK requires more space, either with a new high school or building
expansion. This is another big assumption. The
referendum only mandates that FDK be implemented in the first year. Future
boards could decide to allocate the money elsewhere. While not likely, it's
possible. All these reasons together are why I said the plan is poorly
designed and why I voted no to linking FDK to the status quo part.
However, if all the
pieces fall into place perfectly, the upside is the district gets FDK and loses
less state aid (which means in Year 2, it wouldn't need the $1M state aid
portion of the $5M status quo part.)
2) The $5M status quo
part is made up of approximately
- $1.9M fund balance
replenishment (the district is required to keep 2% of its budget in reserve;
was semi-depleted in the last year for HVAC, increasing special ed costs, etc.)
- $1M estimate of state
aid reduction each year for a total of $5.3M over 6 years - the state aid loss
varies from year to year, some years are more than $1M, some years are less
than $1M
- $2M estimate of health
care premium increases, salary increases, other insurance increases, E-rate
revenue decrease, etc.
Because the 2019-2020
budget is projected to have a $5M deficit, it is true that reductions will need
to be made if the referendum does not pass. Because the school board did not
introduce a tentative budget, it is only speculation where the cuts would come
from.
My personal opinion is
that the district's mission is education, so any cuts should come from areas
that do not directly impact student learning. Also, I would immediately
introduce a resolution to go back to voters to ask again for funding. But
I would ask for it in a "staggered" fashion, not $5M or nothing.
Instead, I would propose $1M allows us to do X, another $1M allows us to do X
and Y, etc.
Unfortunately, because
of election deadlines, the earliest the board could hold another referendum is
in September 2019, so the 2019-2020 budget (which is finalized in May 2019)
would necessarily include reductions.
If the referendum
passes, that gives the district some breathing room. However, to be sustainable
into the future, the district will need to re-evaluate its priorities in light
of costs that are increasing faster than the board's ability to raise the tax
levy. This referendum plugs a hole, it does not solve the problem.
3) Consider the impact
over six years - state aid is projected to decrease by a total of $5.3M over
the next six years. If the referendum is approved, the district will gain
$48.6M in revenue from the local tax payer to fund FDK and maintain the status
quo, beyond the normal 2% tax levy growth plus exemptions.
*******3/11/19 EDITED TO
CLARIFY -
State aid is expected to
decrease by $5.3M over 6 years but it is cumulative. As an example, if our
current state aid is A dollars, and in Year 1, we are projected to lose X
dollars, and in Year 2, we are projected to lose Y dollars, that means our
actual Year 1 aid is (A-X) and our Year 2 aid is (A-X-Y).
Based on current
projections, the total state aid loss over 6 years for status quo (HDK) vs.
implementing FDK is actually $20M. Thank you to Licia Gaber-Baylis and Jeff
Consentino's discussion on how the aid is calculated for allowing me to clarify
this.
*******
Also note, the tax levy
for the current 2018-2019 budget is $95.5M, so this $8.1M tax levy represents
an 8.4% increase in the local tax levy. See the user friendly budget
page 2:
4) Finally, rate-ables
have not been certified for Hillsborough or Millstone, so while there are
estimates for tax impact on the "average" home, it has the feeling of
asking for a semi-blank check.
5) In conclusion, I hope
this perspective shows there are more things to consider than what is presented
through official channels and supporters / opponents of this proposal.
Your vote is important.
Please vote on Tuesday, March 12. Thank you.
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