School officials cautious about announced Federal stimulus
New York Senator Charles Schumer announced Wednesday schools in the Empire State could expect $4.7 billion in federal assistance from the economic stimulus package, but local officials are proceeding with caution.
The American Recovery and Reinvestment Act, otherwise known as the stimulus plan, will send $1.7 billion directly to schools around the state as well as another $3 billion slated for Fiscal Stabilization Funds. These funds are intended to fill in the educational aid funding carved out of the state budget by Gov. David Paterson in his tentative New York State budget.
Together the funds could make up the portion of state aid Granville lost, nearly $350,000 and could make up for a projected shortfall for next year as well.
When the district found out it would lose some state aid this year, officials also advised no increase in aid should be expected for at least the next two years.
Business manager Cathy Somich, Superintendent Dan Teplesky and Board of Education members began the budget process anticipating the need to make deep and continued cuts to the budget for 2009-2010 and beyond.
“I haven’t studied it at length, so I really don’t know,” Board President Kathy Nelson said Monday. “It could be pretty limited, what you can use it for, so I don’t really know what impact it might have (on the budget). We don’t know how strict the guidelines will be.”
Nelson echoed other board members who said budget work would continue without considering the potential funds, “We’re always aiming to have minimum tax impact, that’s always our goal. We’d love to have it (the tax rate) at zero percent.”
“Until Gov. Paterson states that the stimulus money will replace the deficit reduction we are unable to count on any funds for next year’s budget,” Superintendent Dan Teplesky said.
“Should the stimulus money come forward, as Sen. Schumer has stated, the Granville Central School District, Board of Education, Business Manager and Superintendent are trying for a zero percent tax increase,” Teplesky said. “We’re just not sure if it is possible as of today.”
By a quirk of the system, Teplesky said this year would be unusual in that a rejected budget could lead to a tax increase. Teplesky said the austerity budget, by state law, is based on the consumer price index, which stands at about 4 percent currently. A budget rejected by the voters is capped at 4 percent; a number he said would be higher than anything he anticipates the board putting forward to the public.
The stimulus money only affects the next two years, he said, and could at best be a temporary fix.
“That’s why it’s so important to have a vision for down the road,” he said.
Not reducing spending with the temporary relief of the stimulus money in sight could lead to large swings in the tax rate in the future.
“It could be draconian,” he said.
Board member John Steves said, “I don know what we’re going to do” when contacted about the news.
“I think we’re just going to continue on the path we’re on, and be diligent and frugal at least until the dust settles,” he said.
Steves said he felt the board had been making progress on a tight budget that did not sacrifice education quality, and too many variables existed to rely on the as yet unconfirmed funding for any meaningful purpose.
“I don’t see any reason to change our thinking. Someone will have to convince me to change my thinking,” he said.
Steves said the board members were still planning to visit Albany for Lobby Day Match 3, to “make them aware of how we feel; maybe they’ll have more information for us then.”
Asked if the stimulus money could prevent the district from making staffing cuts or having to lay off workers, he said he just could not be sure with the state’s budget not yet set and the economy still not improving.
“I don’t know we’re still looking at staffing that’s one of the last portions of the budget were looking at,” he said. “I don’t know; I’m going to say that we should expect to see something.”
If staffing cuts have to be made Steves said he hoped they might come from retirements rather than layoffs, but added that he was not aware of anyone announcing plans to retire.
“I would not rule it out,” he said, “I’d rather say that now and be wrong than surprise somebody.”
During a recent conference, Steves said he heard that the Argyle school district offered packages to entice older teachers from the upper end of the pay scale to retire, but due to the economy had no takers.
As a result they had been advised to keep planning as they had been, for getting by with less state aid money and if the federal assistance shows up it will be a bonus.
“Rather than no present under the tree, maybe there’ll be one,” Steves said.
Board member John Shaw said he too thought the board would not change course in budget planning now, but continue with the cuts.
Should the projected funds arrive as promised, “Oh I’m sure we’ll find a way to waste it,” he said.