Last week, the School Committee approved a revised recommended budget for fiscal year 2013, as presented by Chief Budget Officer Anthony Ferrucci, in which he projects a net surplus of $89,755. Projecting a surplus is good news, especially during tough economic times, but if things fall right, Ferrucci said that surplus could be closer to $1 million.
Ferrucci said he won’t know what the surplus will total until the end of the year because of monies that may or may not be spent between now and then. One such area is contingency funds that have been set aside should the district get involved in any legal battles or have to pay claims.
“We have money set aside for any litigation that comes up to hire outside attorneys or claims that come up,” he said.
Ferrucci said the district also has a $10,000 deductible for building insurance should any school buildings suffer damage from floods, fires or other such causes.
“We have $150,000 set aside for such contingencies,” he said. “If we don’t get sued and don’t have to hire outside attorneys, that [money] becomes a surplus, but right now I’m projecting it as being spent.”
Ferrucci said another area where the district could realize potential savings is special education placements of Warwick students in out-of-district locations, such as Bradley Hospital or the Rhode Island School for the Deaf.
“Right now we have two special education full-day placements at Bradley Hospital. That costs between $160,000 and $170,000 per student,” he said. “If DCYF places a child in a day program, then we get sent a bill. There is $350,000 set aside to cover such potentials.”
Adding that $350,000 to the $150,000 brings the total possible savings for the district to $500,000.
Ferrucci said additional savings could come from the $300,000 given to Director David LaPlante and the Buildings and Grounds Department for the installation of cameras and buzzers for the doors of elementary buildings as part of increasing security features if that money is not spent by June 30 of this year.
“If they can’t get the work completed before June 30, then they will have to do the work over the summer,” he said. “A project can be approved [by the School Committee], but if the work is not done by June 30, it’s not part of the current budget year and is carried over as surplus dollars for next year’s budget and will be spent once the work is completed.”
Ferrucci used the example of the computer room project last year that was being set up to house the district’s computers and networking equipment, and although the action was approved by the School Committee to move forward that year, the project got hung up in the bidding process and the work wasn’t completed before June 30, so it became a surplus and was carried over to this year’s budget.
If $800,000 in possible savings weren’t enough, Ferrucci said even more savings could result from how effectively the district’s 40 budget managers use their budgets.
“We have 40 budget managers that purchase different things for their programs, and if they purchase items at a cost less than what their budget is, that becomes a surplus,” he said.
Ferrucci used the example of Anne Siesel, assistant director of curriculum, who has $75,000 to $80,000 in her budget for the purchase of needed textbooks, but if she only spends $40,000 on a textbook series, the rest of the money becomes a surplus.
“Between myself, the superintendent, all the principals and directors, if we’re conservative and we all surplus $10,000 in our budgets, that’s another $400,000 in savings,” he said. “I’m expecting everyone to spend their money, but I want it done appropriately and as conservative as possible. I don’t want them to spend it just because they have it, but rather wisely and appropriately without a backlash to their programs to [hopefully] result in a surplus.”
With the potential closure of a junior high this summer, Ferrucci said LaPlante and his workers could be very busy dealing with the logistics of moving textbooks and redistributing other instructional materials.
Ferrucci said if the district doesn’t get sued and doesn’t have to hire attorneys, doesn’t have any additional special education placements, the budget managers are diligent and depending whether or not construction projects get completed by June 30, it could result in a $1 million budget surplus, but because he’s operating on the premise that those contingency funds will be spent, at this point Ferrucci projects a minimum net surplus of $89,755 for FY 2013.