The Warwick School Committee will have reason to celebrate, and then ponder how they will balance program needs and finances for the current year, when they meet tonight.
Schools had been looking at as much as a $600,000 deficit for the fiscal year 2011 that ended on June 30th.
Superintendent Peter Horoschak said Friday that, in the closing weeks of the fiscal year, the department was able to trim costs and end the year in the black. He said the amount of the surplus would be disclosed at tonight’s meeting that starts at 7 p.m. at Toll Gate High.
That is of some solace to the department that needs to come up with $8.8 million in cuts or new revenues to balance the school budget approved by the mayor and city council. The committee approved a $161,188,700 million budget that the mayor and council trimmed to $154.3 million.
Horoschak said sustaining schools programs in the upcoming academic year depends upon contracts with the teachers and the Warwick Independent School Employees, WISE.
“If we can’t work something out with the unions, we can’t finish the school year,” he said.
The WISE union has been without a contract for more than four years and is currently in interest arbitration. The significant “adjustment” – Horoschak’s word – sought by schools is union approval to contract for special education bus services.
The major adjustments sought of teachers, whose contract expires in about six weeks, are an increase in health care co-payment, classroom weighting and layoff limitations that could impact the department’s ability to close schools in response to declining enrollments.
The mayor and council approved $117.7 million in city revenues for schools – the same amount the city provided schools in the past year. Schools had asked for a $6.2 million increase in city funding based on the “maintenance of effort” determined by city funding for 2009. Schools budgeted the increase based on a memo from Commissioner of Elementary and Secondary Education Deborah Gist that municipalities are required to fund at the 2009 maintenance of effort. The city challenges the ruling.
So far, schools are not pressing the issue and Horoschak doubts that will be a tactic, as funds are tight at all levels.
“I don’t think the school committee wants to put the city on line,” he said.
There is no movement on the issue at the Department of Education, either. Department spokesman Elliot Krieger had no new developments to report as of yesterday.
There’s more at play on a statewide level.
Horoschak said what the department is required to contribute to teacher pensions and court action on the East Providence case could dramatically impact finances. Because of reduced investment returns, the department has been instructed to contribute an additional $1.5million to pensions for a total payment of $8.6 million. This puts the department contribution at 13 percent of teacher and certified administrators salaries. For the fiscal year beginning next July 1, the state is calling for the school share to jump to 20.98 percent of wages for an additional $5.3 million, school director of business affairs Anthony Ferrucci said yesterday.
“This will put us over the cap [what the city can raise in added tax levees]; there’s no way to raise that kind of money,” Ferrucci said of the projected contribution.
Teacher contributions to the plan are at 9.5 percent.
The East Providence case could alter the dynamics of contract negotiations.
In East Providence, the school committee reasoned, on the basis that the teacher contract expired, that it had the power to make changes, including the elimination of programs and positions. The unions argue that conditions of the expired contract remain in effect until a new agreement is reached.
In addition to the $6.2 million schools will need to trim from its budget if the city’s position is upheld, Horoschak said the department still needs to identify another $2 million in non salary and benefit cuts it projected when drafting the plan. It also needs to come up with the $600,000 the school committee added to the department’s budget request.
“We now know there’s no deficit to contend with,” Ferrucci said, “and we can chip away over the next 60 days.”
He is optimistic he can trim the non-salary and benefit account to close to the $20 million budgeted last year. And he said he is working to get numbers for Medicaid as well as tuitions for out of district students.
As he is new to the department, Ferrucci said closing out the last fiscal year will provide him the basis to review the proposed budget and “see if anything needs to be revisited.”
He said his objective is to stabilize school expenditures and rebuild trust in the department.
“I’m not going to recommend anything that is detrimental to the needs of students,” Horoschak said, when asked how he plans to approach balancing the budget.
As for relations with the city, Horoschak said, “I want to restore trust with the mayor and council. Going through a year without a director of business affairs was difficult. Now we want to show what the situation is and that our numbers are real.”