If Schenectady school budget fails, tax levy will be even higher

If the Schenectady City School District’s $160.6 million budget fails at the polls later this month, the district will adopt a contingency budget with a 15.8 percent increase in the tax levy, Superintendent Eric Ely said. But it won’t spend it all.

The district will put a revised $160,624,500 budget plan before voters on June 16 — $480,000 more than the spending plan that was defeated by voters. The revised proposal carries a tax increase of 5.8 percent. If this new budget also fails, district officials say they will have to adopt a contingency budget of $165.5 million.

“We have to budget the money; we don’t have to spend it,” Ely told The Daily Gazette editorial board on Thursday.

Ely said if voters did reject the budget, the district would spend less than the contingency budget cap, “the bare minimum,” he said. The rest would go into the surplus.

The district arrived at its contingency budget number after plugging all the numbers into the formula that limits the contingency budget to 120 percent of the inflation rate — 4 percent in this case — minus expenses such as student supplies, community use of buildings and grounds, certain equipment purchases and certain salary increases. The formula allows for extra spending based on enrollment increases.

In Schenectady’s case, the primary reason for a larger contingency budget is a projected 4.8 percent growth in enrollment — roughly 471 students. This represents $6.6 million.

“The contingency budget is not something we have a lot of control over,” Ely said. “The contingency budget is a formula where we have to use research-based information from an independent based research company. We use those numbers in the contingency calculation.”

A study developed by the Minnesota-based Information Management Systems said the district’s enrollment would grow by 4.8 percent by extrapolating from birth rates.

Ely attributed the enrollment increase to the economy. “People [are] moving back to the city. Even though the taxes are high, houses are cheaper,” he said.

The district is seeing growth in the early years. Its kindergarten and first- and second-grade classes have more than 830 students.

Ely said the district’s enrollment has grown anywhere from 1 percent to 5 percent annually. There were large increases a few years ago when there was an influx of Guyanese students. In addition, this year had an influx of students from the International Charter School of Schenectady.

Ely said the district does not want to go to a contingency budget because it gives the district less flexibility on spending.

The State Education Department Web site says “the contingency budget adopted by the Board of Education would always be less than the proposed budget.”

When pressed on the issue, SED spokesman Jonathan Burman said in an e-mail “there has been no ruling by the commissioner on the circumstances under which a contingency budget may exceed the budget proposed to the voters.”

He added that since this matter would likely come before the commissioner as an appeal, he would not be able to comment any further. He did not mention who could appeal.

School Attorney Shari Greenleaf said a March 2 decision from the state education commissioner said that school districts must strictly follow the formula.

“That doesn’t make any reference to the prior budget and explicitly says when you’re in a contingency, you follow the formula,” he said.

Ely also clarified some line items in the budget. Salaries did not go up $8 million. Instead, some of that was transferred from the Contract for Excellence line item, money the district receives as a high needs district.

He said he believes that the Contract for Excellence money is helping the district improve its English test scores and literacy. It has also decreased class sizes.

Ely also defended his own $175,000 salary and said there is a $14,899 contribution to a retirement plan. He also receives a $4,000 travel allowance.

“There is no raise in my contract. I don’t have a raise. The board has not approved a raise,” he said.

He said if offered a raise this year, he would turn it down because the administrators’ union agreed not to take a raise this year.

David Albert, spokesman for the state School Boards Association, said later in the day he was unsure about whether the contingency budget can be higher than the defeated budget.

“I’ve talked to State Ed about it. Ultimately, I think that’s a question for the commissioner at SED to answer. It is an unusual year where so many school districts [have] spending increases below the contingency cap, and honestly, we haven’t gotten the definite word on that,” he said.

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