The Niskayuna Central School District is facing a projected $3.8 million gap in its 2013-14 budget.
Assistant Superintendent for Business Matt Bourgeois told the Board of Education on Monday that expenses are set to rise by $2.4 million. Revenues are dropping by $1.4 million, meanwhile, because of declining state aid.
That leaves a budget hole unless the district increases the tax levy by more than the 2 percent state-mandated tax cap.
“Budgets are going to be unsustainable at 2 percent unless you decrease expenditures or increase revenues,” Bourgeois said.
If the district wanted to exceed the tax cap, it would require approval by at least 60 percent of voters. Residents in May overwhelmingly approved Niskayuna’s $75.3 million 2012-13 budget, with 69 percent in favor. That budget did not exceed the tax cap, however.
One issue is that the district is assuming that the operating aid it receives from the state will stay flat and aid it gets for transportation, special education and building projects will decrease.
“There are still a lot of uncertainties and a lot of unknowns at this point in time,” Bourgeois said.
Niskayuna also cannot tap its surplus because it will have almost none by the end of the year, having depleted its funds to avoid steeper tax increases or more program cuts.
“You’re drawing down your savings to close that [gap] for one year and putting it off to the next year,” Bourgeois said.
Moody’s Investors Service recently downgraded the district’s credit rating by one notch to Aa3 out of concern about its low reserves.
Niskayuna had $11.6 million in reserves at the end of the 2009-10 year, and that figure is down to $7.3 million now. However, most of that surplus is designated for specific items, such as tax challenges and retirement costs.
District Superintendent Susan Kay Salvaggio said the board would discuss the fund balance in depth at another meeting.