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04/04/2017 04:00 PMA lightly attended Board of Finance budget hearing on March 21 yielded few audience questions following presentations describing the proposed town and schools budgets, which propose a 1.3 percent increase over the current year.
The hearing began with a review of the Board of Education approved budget by school business and operations manager Julie Pendleton and Superintendent of Schools Jan Perruccio. The proposed Board of Education budget for the schools would go up by 1.30 percent or $329,831.
Perruccio noted that the school district managed needed staff increases by sharing in the hire of two positions with the Westbrook school district: one, a special education board-certified behavior analyst (BCBA) and the other, an English language learner (ELL) teacher. The ELL teacher hire is mandated for school districts once their enrolled population reaches a certain threshold. For Old Saybrook, that will be for the next school year. The BCBA hire will provide services the district now pays an independent consultant to perform. Having the staff person on staff will result in cost savings to the district.
Other changes include the addition of a half time social worker and two certified staff at the high school: one for culinary arts and one school-to-career teacher.
The school district also achieved cost savings by locking in a low price for diesel fuel for the buses. Also, the district is now seeing savings in health insurance as a result of lower claims, now that the district is in the second year of the High Deductible/Health Savings Account plan design.
First Selectman Carl Fortuna, Jr., presented the town budget and discussed the trends that affect it. The proposed town budget for general government for 2017-’18 would increase spending by 2.71 percent or $518,801 over the current year.
Fortuna explained that over the last two years, the state has dramatically cut the state revenue the town receives. Although he acknowledged this was bad news, he said the good news part of the story is that the town has not relied on state revenue as much as many towns and cities.
“For the 2015-’16 year, the town budgeted $1.2 million for state revenue, not including the state’s special education grants. This year, we’re budgeting $500,000,” said Fortuna. “Then we had a mid-year cut from a $140,000 grant down to $92,000.
Fortuna also addressed Governor Dannel Malloy’s proposal to have municipalities fund one-third of their teachers’ pension; the state is currently responsible for funding those pensions.
“The governor has turned the tables, but it’s a proposal. I don’t know if this will see the light of day. This either would devastate school budgets or push up property taxes. I just think it’s a poor solution to the issue,” Fortuna said. “Smaller communities like Clinton and Old Lyme could lose millions. Old Saybrook is positioned well.”
Fortuna noted that all of the town employee unions now are on a high-deductible health insurance plan with a health savings account, which will begin to save the town money. However, though the town has had several years of good health claims experience (with employees requiring relatively less health care), this year is a bad claims experience year, which means that the town’s health insurance costs will rise more in the next year than in prior years.
At the same time, the new accounting system—and the accounting department reorganization linked to it— will reduce town costs for that function. Another good sign for the town is that annual debt payments continue to decline.
Residents Weigh In
After the two budget presentations, the public got the chance to ask questions and make comments.
Resident David Towle asked about the rise in town government expenses and how much it reflected anticipated reductions in state revenue.
Fortuna answered, “This [next budget] year we’re projecting $350,000 in state revenue to the town. That’s lower by $200,000.”
Towle also praised this year’s budget organization that includes employee benefits in the department where the employees are assigned. The budget, like the new accounting system, adheres to the accounting structure of the Uniform Chart of Accounts (UCOA). Under UCOA, expenses for employee benefits and salaries are allocated to the budgets of the department in which they work.
Resident Tarra Barros asked whether the budget takes into account the people living in the new North Main Street apartments and their impact on the schools.
Fortuna explained that the current Grand List of Taxable Property includes a partial value for the North Main Street apartments because only one building was completed by the Oct. 1, 2016 assessment date. The next year’s Grand List, with values taken as of Oct. 1, 2017, should include the property’s full value.
“What is assessed now is a partial property tax revenue [from the North Main Street apartments] of $200,000,” said Fortuna. “We have a declining school population and we could use a few extra children. I don’t think [the North Main apartments] will dramatically affect the eduction. I am hopeful for the success of that project. We need people walking downtown. Building new living downtown can only be good for our businesses.”
Perruccio followed up, explaining that any students coming from there would be spread across the grade levels.
“We were told to expect 60 students from that project,” she said. “We’re ready and would happily absorb it.”