001Good evening everybody. At 6:04 p.m. we'll call to order a meeting of the board of education. Please stand for the pledge allegiance to the flag of the United States of America and to the republic for which it stands. One nation under God, indivisible with liberty and justice for all. All right, Jesse, we have our first budget presentation of the season. >> Good evening everybody. Um, my name is uh Jesse Bow. I'm the business administrator here at the Rava Central School District. Um, so tonight is the first uh budget meeting we have for the 2 26 27 budget cycle. Uh, so I always like to start the the budget meetings with kind of a review, a look back on kind of our our fiscal profile, where the district is at and where I expect to see
002in the future. Uh, feel free to stop me at any time if you guys have any questions or you need me to clarify anything. So, first off, uh I do like to point out that this is our enrollment uh data for and it looks like it's falling off a little bit on this one, but uh from the 1718 school year to uh 2425 school year. So, you can see that it is steadily declining and that is uh very important when it comes to budgeting because with steady decline we have to start looking at right sizing some certain areas. So next this this uh these two graphs are showing our revenue in the district. So the graph on the lefth hand side of that bar graph shows our shows our revenue for the last few years
003and as you can see it is steadily increasing. Um it is on the right hand side you can see the part uh piraphph uh piraphph that shows the difference um the percentages of where we're getting our money from. So, uh, last year our 51% of it was from a local share or from our taxes and 39%, uh, from state aid. Uh, so that is kind of shifting a little bit. Uh, over the last few years, it was a little bit more leaning towards state aid a little bit more and then a little bit less for tax levy. But after the few years, we are kind of switching a little bit more relying on our local cost or our taxes. Um, other thing to point out here is we are still relying about 4% on our
004unassign our assigned fund balance. And what that means is when we're developing our budgets, we're budgeting at a deficit and we're uh planning to use some of our our our savings or our fund balance and also other revenue. Uh, majority of that is our pilot program. We do and pilot means a payment in le of taxes. We have some pretty sizable uh pilots in this area. Um and right now we're about uh 2.5 uh million dollars in pilots. And uh we do expect in the 20 uh 2728 school year to have another one that will increase it by about 1.2 million. I'll get into that a little bit more later. Any questions on revenue? So, next one is uh the historical expense. Um again, this shows a previous where we've been in our expenses. You
005can see kind of a little bit of an uptick in the 22 23 school year. We actually used a significant amount of our uh unassigned fund balance to pay for an emergency project. So, what that did was our raise our our transfer to capital, which in turn raised our budget year to help pay for that capital project. Um so that's why you see that one uptick in um expenses but over that overall besides that you do see a steady incline uh over the years. Um and on the right hand side we're looking at the piraphph 77% of it is for program and this is for uh all of our instruction for all of our teachers our transportation. So majority of our budget is for program which it should be. were for schools, right? Uh capital
006is about 15% uh which is that's for our building and grounds and our debt and administrative is about 8% and that's for the um business office, the superintendent's office, some of the PD uh stuff and a little bit around some of the financial advising. Any questions on that? Next is our fund balance. So, this is our fund balance accounts that we had at the end of uh last school uh fiscal year or June 30th uh 25. I'm going to go through this relatively quickly. So, pretty I know I've done this to you guys a few times, but I do like to revisit it real quickly. The first one is the employee retirement reserve. So this is for our ERS or non-instructional employees and this could be used for the employer contribution for uh those employees.
007So just to give you a reference of how much that 9.5 really means, last year we paid $827,000 for our employee contribution to ERS. So you're looking at a little bit over two years of it in that reserve. Next one is the teacher retirement reserve or TRS. It's uh same thing as the ERS reserve, but this one is for the instructional staff um employee employee employer contributions. Uh last year we paid uh right around $2 million for that. Um so we are at the one year for that in reserve. Um by law that is the most that we can have in that reserve. So we we have maxed that out to the the most we can. Um and I said that's that's one of the biggest expenses that we have for the retirement reserve. So
008it's key to really have some good amount of money in there. Uh the reserve for tax assertiary that is for if we have any out outstanding claims for assessment changes and we do still have uh one significant outstanding claim right now uh same similar that we have in the past is the Alb water board. So it is relatively high at this point, but we do keep that reserve only to what what we have outstanding. So if we did have some of them that came off, we would I would ask the board to make an adjustment for that. And we do link that up to our that that plan is all coming out of our our reserve plan which has been uh reviewed and adopted by the board. Capital reserve is exactly what it sounds like.
009It's for capital projects. uh this this number in here does not include the $750,000 that's going to come out of that which was the plan uh for our our security and safety capital project that we approved last year. So that needs to be reduced by 750,000. Uh we also later on the budget process will bring to you a capital project that we'd like to do in the in the coming future where we will use we plan to use some of that capital reserve to reserve uh lower the local cost. Reserve reserve for debt is is the money that in these capital reser uh plans if we didn't use all the debt that we plan to use for these capital projects uh it has to go into reserve to pay down those those debts at a
010later date. Uh employee benefit reserve. So this reserve is for when people retire. Uh it's for instructional staff, ERS staff. Um it's for paying out per their contract. Um they get pay out when they retire. And this reserve is there to to help help sorry help offset that cost. So it's really hard to budget for something like that because you really don't know who plans on retiring when you're setting up the budget. So this is a key um reserve that is is really I think we're in really strong situation right now in this reserve. So we don't need to estimate that budget for those payouts. So when those payouts comes if we have like the next coming year we plan on significant amount of retirees that would be a very high increase to our budget.
011But because we have this strong reserve we don't need to budget it. We can use this reserve to offset that. can only put into a certain amount or >> no there's there's no limit to that but there is so we do do a calculation at the end of the year okay >> with through the audit and and some other things we look we do a calculation so that is very >> calculated in the past we have had it maxed out we're like hey this is the most that we could ever see really from if everybody left >> right >> but now that we've there's been some new rules implemented that calculation has gotten much higher so that number isn't at max, but I'm still very confident that we we're we're covered in that area. >>
012Okay. >> Go ahead. >> I know I've seen this before and I was in the finance meeting with you, but I had a new question since then. Sure. >> Can we at some point can you give us the last five years of what we used in this, what we've done over the last five years and what you sort of estimate this year will be. >> Sure. >> You can just share that. >> It's tough to estimate the future. Uh I mean I could do based on what I know who the retire. >> Uh >> I'm I'm less worried about this year's and I want the last five. So, >> so you want the last five that we use this reserve for? >> Yes. Yeah, >> absolutely. >> Thank you. >> Appreciate it. I can do
013that at the next board meeting. >> Um, so the repair reserve, this is for outside of capital projects. This is really used for if we have a issue for a large like a boiler goes down or we have a roof issue, we can use this reserve to pay for those repairs. But this repair, this reserve does have a some stipulations to it. if you do take money out that you do have to replace it over a certain period of time. So the next one down is on assigned fund balance. Um and at the end of last year we were at 5.15% which is above the legal limit of 4%. Um, but we've had a lot of discussions here at at with the board and also with our finance committee that we feel that the 4%
014is not adequate enough to fund a district with their budget of almost $60 million. Um, we feel like a five to 6% is a good window to be in. Um, and we are within that uh window. Um, and I will say that we have been in the past been much higher with our unassigned fund balance, but we have w wh whittleled it down. I think at one point we were up at 14%. So, we've either strategically moved them to reserves or we have um, you know, spent it down in certain areas. >> Go ahead, Mike. Thinking about statewide for a minute, that 4% figure, the districts statewide that might be at that 4% figure >> can't be that many. >> I I don't know that answer. I know it's a very interesting conversation at all
015of our business administrating meetings. They said it's just not adequate enough. I I like to look at it like as your household. If you have a certain amount of expense, you only have 4% in your savings to be able to pay for it. I mean, that's >> Yeah, >> that just seems >> not not a good idea, right? >> Yeah. >> Um, but right now the law is is at 4% for the unassigned fund balance. >> So, do we get dinged for that since we're >> we do every year we do get we do get it on our audit. Um, and uh that's last the three years I've been here. That's the things we've been written up for. Uh but we are well aware and I and I still think if the comproller were to
016come and audit our books for for having too much too much in unassigned fund balance our argument would be we have a uh a very strong reserve plan where we've reviewed it with our finance committee. We've reviewed it with the public and everybody and the board has actually adopted. So we're being very transparent of why we have the funds we really do. >> Okay. history on this one and we talked about this in the finance committee meeting is many districts went way over the 4% you had districts on Long Island at 30 40% in here like ridiculous numbers that's actually what led to the tax cap because they they saw all those reserves so what came out of that besides the fact that they said you got to get them down and and having a
017tax cap was if somebody is still up in those numbers the threat is they'll take a commensurate amount away from your state aid but not as Jesse said very clearly if you're in this range then they're they're not worried about it. They want to make sure nobody goes back to those 15 20 30% because they feel like you're just holding taxpayer money hostage. But this is just what we need to survive on the >> huh. >> Yeah. It was before the tax levy limit where you could put any amount on raising taxes as you wanted. >> Uh that was back in the old days where people would just roll the budget say hey let's just add 3% on it and call it a day and we'll tax the people a certain amount of money. That's
018what those days are gone. >> I realize I should probably know the answers to some of these questions, but we only do it once a year. >> No, absolutely. I I encourage you because ask the question because other people might have it, too. So, please >> the huge crowd on YouTube right now. >> That's right. >> So, the last one on here is our assigned fund balance. And what that is is that's the money that we've put in our last year's budget as a deficit. So, we planned on using the $2.3 million Um, we as a finance committee and a kind of a district, we believe that's a little bit high. Uh, I would like to see a much more maybe two to 1%. Uh, but that's something that we just can't do overnight. That's
019something that we have to strategically lower if we're able to do it. Um, but that has decreased from previous years as well. It has been up uh much higher than that in the past. Uh I don't have those numbers so I don't want to give you exact detail but that has been lowered. I know for the year before that it was 2.5 million for our signed fund balance. So we were able because we got additional state aid that I we weren't expecting. We were able to lower that lower that by by 200,000. So we are going in the right direction. Uh I will also mention that we do budget for this but we haven't actually had to dip into it. So, what I mean is, hey, I saying I'm I think I believe we're going
020to need this extra revenue to be able to pay for our budget, but we haven't gotten to that point where we had to use it. So, we've gotten additional revenue that was unexpected or some of the expenses weren't as high as we we anticipated. So, any questions on fund balance or reserves? Okay. So, I know this is kind of a a big it's hard to see on the screen, but hopefully you can look on your packet and I believe for the public it is on our board meeting, so they can they can see it as well there. So, what this is really showing is kind of a trend of that bottom like dark line. That's our fund balance of where it's been. Uh, and as you can see how we were very low in the
0212008, which is a scary place to be. Uh and then we were going very significantly high but we are going a little bit back down. Um there's a delicate balance of having too much fund balance and not enough. Again I go back to having uh what you want to have in your savings for your own home. If it's too much it's it doesn't make sense. Something needs to change or you don't need to have it. And then also if you don't have enough you you can't weather those storms. So, if you don't have if we didn't have a healthy reserves and we all of a sudden we get hit with something like the gap eliminating adjustment. I don't know if people remember that, but that's where the state will say, "Hey, listen, you're owed this
022amount of money, but because the state isn't getting the budget's not working out, we're going to take away a certain amount away from you." So, having healthy reserves and healthy fund balance will help us to weather those storms. So, that's Those are the things that come up that we have to start plan for. Hopefully it never happens, but it very well could and it has happened in the past. So, next one here is the historical tax levy. And what this is showing is the green is is what our levy was allowing us to go to. So, our cap. The yellow is what we actually went at. So, what I like to show here is is kind of the up and down, the peaks and valleys we have of that that that I personally believe is
023is not great for the public. We want to try to keep it as steady as possible. The peaks and valleys like it it's it's hard for families and hard for people to be able to plan. You know, if if we can keep it right around the 2% and sometimes we're unable to do it, right? There's things that come in and uh things that are added that it might not let us do it, but the goal is to overall stay at a level that that's a consistent rise if we need to. If we don't, then very we can lower it, but I like to try to keep it as close to 2% or around that range as possible. But you can see some of the things that might you know that could affect it. back in
0242122 we could have went out at at two can't see that far 2.53% but we went out at zero and very well that could have been a good decision because we had the funds to pay for it but we could have thought maybe the next year hey maybe we go at one and then next year we can we can project out maybe hey next year might be three but if we go at one I we go two so those are the things like we got to think about when we're talking about the tax levy limit. It's not just this year, right? We have to try to look at years to come so we can really keep that try to do our best to keep it as level as possible. So again, I apologize, but this
025is our our upcoming tax preliminary tax. Uh there's still some unanswered uh numbers that that I I need to finalize it. Uh but right now, this is the calculation that that I'm assuming for the uh 26 27 school year. Um couple things I'd like to point out here is the tax growth factor which is uh very low. And what the tax growth factor is is really based on new construction in the area. Um and they they put a number to that uh and it's it's uh 0.0063. So it hasn't been a lot of big construction and I know there has been construction in the area but overall there hasn't been a ton in this area. Um that is not a big factor in this calculation. If you go a little bit farther down that allowable
026levy growth factor is so that's this based on CPI and that that number is when I think everybody here has heard hey the highest you can go is 2%. The highest you can go is 2%. And that's not in the past it might have been that's not the truth but that number right there is the highest it can go is 2%. So the I don't have the number off of 10 but I know that the inflation rate was much higher than 2%. Uh but we are capped at the 2% in this calculation where if it wasn't capped and we could go up to the four that would give us a little bit more ability to raise taxes if we needed to. But right now by law this is the calculation uh for the tax levy
027limit. So right now we are looking at a max of 2.25% or 656,000 uh increase from last year. again early on. I don't I don't expect big swings, but this could go a couple percent I mean point of a percent in a in either direction based on final numbers. >> The governor just put her numbers out yesterday. >> Yeah, that's not this is more like finalizing debt and um some of the I guess the building aid would have some impact on it. We get some numbers from Boseies as well for their capital stuff. So, we need those. simple point I want to make was it's nothing that it's just stuff we're waiting on from other entities. >> Yes, it is not >> that's which I know I want people to know that >> we need
028it from other people. >> That's correct. Yes. >> Just one question on the tax levy. >> Yeah. >> Figures Jesse. >> Yeah. >> So the past three years we've been declining from about 4 and a.5% allowable to three and a half% to 2 and a/4% projected this year. What's the simplest explanation for why we're seeing that decline and what should we expect in future budget years? >> So, it's hard for me because I came in I came in 24 25 school year. So, a lot of these big swings or were happening is debt related and some of that debt related is from capital projects that happened before I was here. Um, and also building aid related to that. So when you have building aid or you have building aid falling off, that will decrease your
029I mean that will if you if you have building aid, which is state aid coming off, that will increase your levy because you're not getting as much aid from the state. So technically, you would think that you should be getting more um you you you need to raise more money in taxes. So without really doing a deep dive on exactly what those those big swings are uh early early years there >> um >> I could tell you for for 24 25 and 25 26 it really is debt and building aid related. We had a few older projects that fell off and that's why we still have debt that we're paying off for those. So you you'll see the really big four four percents and uh like the 3%s because of that. Again, my goal is
030to align our debt schedule with with our building aid schedule so we don't see these things in the future. >> Are are we facing a continuous trend though where we're going down and each year the allowable limit is less and less and is there anything we can do to >> plan now to offset that? So we are looking again my trend is to get more towards the the 2%. But also you have to take in account what you've done in previous years right so I mean the first calculation in the levy limit is the previous year. >> So if we're if we're not putting >> the say we're not going to the max we can we're really limiting the amount of money we can raise in the future. So we got to look at that
031too. >> So that that 20 or was it the first one on there 21 22 >> when the district went out at 0% when they could have gone at 2%. So now you're essentially your increase is the next year not so much based on zero but based on no change from the the previous year before that. So >> going to 4.49. >> Yeah. >> Well there's other things that >> Yeah. >> So that's what we had >> just logically >> I'm just concerned we're seeing this decline now for three years in a row. And is there a way to stabilize and not decline further? >> We're trying. >> The thing is though, we have some out outstanding things like the pilot that's coming on board that's really going to die bomb it too. >> But
032that's some of that stuff's out of our control. If if we know we have pilots coming on and coming off, >> that's that's a driving factor for this, too. Because if I have a brand new pilot coming on that f first year, depending on how much it is like and I'm going to get into it a little bit more, that swings my tax levy like crazy. >> So, taking all that into account, we really do try to keep it around that two to 3%. >> And I you'll see his projections for >> I know this is Jesse's job, but I've been staring at these things for 22 years, right? And looking at them, I wouldn't get too concerned about that. This has a lot sometimes to do also what's going on nationally economically. So things
033have been getting actually a little bit better. Inflation has come down from some of the highs a few years ago. So that that's some impacted in there. There's just so many factors in it >> and there can be very localized. But I I don't think that you can even see those first three years where it was all over the place. >> It's really just a year to year what's going on in the world. What are we doing with debt and and capital projects? >> I will tell you the goal again is stabilized as much as possible. Yeah. >> Yeah. >> Okay. >> That 2.25%. That's the max, right? >> For next year. Yeah. Right now. Yes. >> It's an estimate though. It's not the max. >> It's an estimate right now with the information that
034I have >> and but that is >> if you want to go 50%. >> That's the highest that we can go. >> That's what >> But that could go up, >> right? But as of right now, that's >> as of right now. Yes. >> Yes. That's that's what the most we can do. So, this is kind of getting into a little bit of what I was talking about. Again, I apologize. It's kind of a small uh graph, but there's a lot of great information on here. I really I really like this graph. So, what this is, this shows our tax levy limit going back to 1718, I believe. I can't see that far. Yeah, 1718. Okay. And that bottom that difference between line right there, which is that line right above the graph, that's showing
035the difference if we were to go out at the max tax levy limit. That's that's what we we left on the table. So in the past we didn't go if you go back to this you can see like for the 2122 school year we could have gone up over 2% but we decided not to not at all. So that has an effect on the tax levy limit going forward after that because now I can't we can't raise taxes up to a certain point. So going back to this graph, this shows how much we've left on the table, I want to say, but it we it's it's a delicate balance, right? We have to make sure that we we don't overt tax the community, but we also have to take into account what's going on on
036the state level. And if you remember back when I first talked about revenue, we're switching closer towards relying more on the local cost. So we really when we're we're looking at the tax levy and deciding how much to raise it, we really need to look at at projecting out what this is going to limit us in the future. Again, we don't want to overt tax the taxpayers. It's super important. But it's not just that year we have to look at because we do affect future years when we make those decisions >> going back to the 2122 and before that I'm just speculating but the unassigned fund balance was percentage was extremely high at that point >> right >> so pos that could have weighed into what the the board went out at >> because there
037was that much money sitting there that >> Yeah. Okay. >> And don't get me wrong, I I don't want to criticize previous boards or previous people that have been in been in this position. It very well could have been the right decision. All I am saying that is when we make these decisions that we need to think future how this is going to affect it, >> right? >> So, but you're very right. We did have a lot of fund balance in the in the past and we could have decided to use it and we didn't need to use the local taxes. So, but that gap the the graph on the right is really telling. It really shows that gray line on the above that's where we could have been. So, that's where like if we
038needed to tax at that level, that's where we could have been. That's the max that we could have been. We're right now at that orange line. So again, really I'm emphasizing it again that we really need to concentrate when we're making these decisions to think about the future with these limits because we are looking at lower state aid. We're looking at other things increasing and this is going to come into play a lot more in the future. So I I do like to do this as well. Uh again, this is preliminary numbers. We don't have assessed values for anybody, but uh an increase of 2.25% or that little bit over six uh 650,000 uh would be uh a little bit right around uh $47 a year for $100,000 house. Obviously, most houses around here aren't
039worth $100,000. So if you believe your house is worth 200, 300, double it, triple it from there. Again, preliminary numbers with that low percentage increase, if we did see a assessed value increase, we could actually see some decreases as well. So it is possible. So these next two graphs I I I really like and this was brought to me by one of the board members. Um, so what these both these next two graphs are doing is we're looking at our full value of our property and our wealth for the district and we're comparing that to the tax levy limit. So what this is doing is is really seeing that as a whole, can the district really afford the amount of tax that we're levying? Obviously there's different situations where individually yes, no you can. But
040overall these numbers will compare it to our property value and our wealth value. And as you can see, we're we are very low with the percentage. So just by looking at this full value of property of the district and basing that as one form of wealth of the area, we believe we're doing a good job and not overt taxing the taxpayers. We actually are decreasing it from previous years. >> It's businesses, correct? Not just >> all the assessed. Yep. Yep. >> So this is the property value. Uh and then this is the wealth uh adjusted growth income of the district. And you can see one of the reasons is is it is increasing um as our tax levy increases as well. So you can see we are dropping it. So I I I would like
041to see this one a little bit lower. Uh but we are if they say you're below 10, you're in good position. Yeah. So, this is a great to kind of give again overview of the whole the whole district uh if we're if our tax levy is really being a burden on uh on our taxpayers. So, next uh this is our projected tax levy. Uh again, you'll see that 2.25 which is what I project for next year. Um and then you see that negative uh in 2728 and I know you guys heard me talk about that possibly happening this year but if you read the paper uh you know and at the last for me I mentioned it that we are not going to be receiving that large pilot that I anticipated that we were going
042to receive in the 26 27 school year. So that is going to be pushed to the 2728 school year. And because of that large pilot coming on board and that tax levy limit being one of a new a pilots's coming on current year being one of the calculations on it, we are actually looking at a negative tax levy limit next year. Uh so what that means is technically the highest we could go out next year would be lower than than we're doing this year. I'm personally recommending >> that. Could you >> So, uh, the levy that we're allowed to tax, >> right? >> If we were to follow that tax levy and not go for a supermajority above the cap, >> our amount of taxes that we could raise would be less by I think
043it's a little bit over 1% less than we would be for 26 27. >> So, it would be like one between 1 and 1.2. 25%. >> Yep. >> Well, yeah. Less than the what? 26 27. So that would be the same, >> right? >> Yeah. >> So based on these projections here for 2728, what could we go out at? >> I >> for a for a tax levy increase. >> So it it's definitely a conversation, right? I'm saying at a minimum we go out at zero. keep it steady. But again, we don't know factors. It could be we could have the market could crash and all of a sudden our our employment contributions go through the roof and all that kind of stuff. But right now, I'm I'm going to suggest that we go out
044at zero. >> And if we go out at zero when the tax levy is negative 1.18%, does that require >> Yes. >> super majority to go out at zero? >> You have to. So it has to be 60% and one vote. >> So it's going to be a lot of communication if we do that to make sure people understand >> that we're not raising your taxes, >> right? >> But it still requires a super majority >> to go out at zero >> because expenses. >> What happens if that doesn't happen? Do you have to pay back money? >> What do you mean if it like if we doesn't we don't get that? >> We don't get that then the budget goes down. >> Then we have to make cuts. >> Not necessarily. We just >>
045Wow. >> Are you saying if we don't if we go if we don't go to zero >> if we put zero out and don't get the supermajority approved, >> right? Yeah. Then the budget is like a fail. So we'd have to either >> There's a couple things you can do if that happens. You can go back out again. >> Yeah. >> You can revise it. >> Right. Or or go to a contingent budget which >> is much worse. Don't want that. >> Nobody wants that. Right. So anything above ne negative 1.18% would require supermajority. >> Yes. >> So even even a negative even a tax decrease would require would require supermajority >> unfortunately. Yes. >> Okay. >> Yeah. Um I know we've been lo my agency has been lobbying for at least zero in these
046circumstances. >> Um but you do got to remember we are going to be receiving a large pilot for this right. So there'll be some money coming in >> but we also have to think the future right. So if I did a a quick calculation >> if we were to go from and and go at the max and it would decrease by the the 1.18 there >> we would we lose out on the following year of $360,000. >> So if we were to go at zero it would increase it by 360. So it doesn't mean we have to do it but we have the option to do it right and then that number increases after that. So >> does prevent the peaks and valleys that Jesse was talking about before. >> Yep. So if sorry Ed
047so the following year then 2829 >> does that assume that we went out at zero 2728 >> that in this calculation uh this is assumes that we this is just yes it was zero we went out at zero so it would change it by >> it would change it by a small amount like a 08% >> okay >> but that again on you know almost. It's a significant amount of money in a $15 million levy. So >> Jesse, >> in order to avoid >> the possibility of having to have a super majority uh for next year for that zero, why wouldn't we try to bring it up a little bit more this year in order that we don't end up with a supermajority next year? >> We'd have to go to a supermajority this year,
048>> right? >> Oh, you're already at that. >> Yeah. Yeah, we're at the max. This calculation is doing the max. >> Yep. >> Um, and it would have to be significant to change it that much. And the the pilot that's coming on board is that is 1.2 million. So, it is a significant amount. Um, and that's why you see that swing, which I'm trying to prevent one year or another. Um, and after this this pilot comes on board, you're not going to see a big swing one way or another until it comes off in 30 years because it really is it's current year and previous year. So when you have similar amount, it doesn't affect it in months. But if the current year you're adding $1.2 million has a large effect on your tax levy.
049So and then going out once you start going out four or five years it's much harder to predict. So I'm very I don't like to do big swings until because those are a lot of estimated numbers. So I it get it does get brought down and it's right around the two high ones too going forward. Any questions on that? >> Sure. I know we sit here and we we talk about it and we try to understand it and the communication going out to the the public is going to be really instrumental. How do you put it in in simpler terms for the public? Because when we look at going back at that previous slide where it says 1.88% basically over our our whole entire value. Keep going. Oh, you mean this one? >> Yeah. So,
050I understand it, but the general public, they see it as that's great, but my taxes are going up. >> Yeah. >> That's they they tend to forget. >> You're right. You're 100%. >> So, how do how do we I guess the challenge as the district is how do we >> explain things in much simpler terms? >> Yeah. I I really like to go back to using uh what people do on a daily basis like uh kind of referring back to that and that's definitely a challenge that we're going to have to come up. We have two years to do it but you're absolutely right. You need to have something well I can relate to this because he talked to it in these terms. Right. Right. >> I I really do like to do it like
051household expense because majority of people deal with household expenses. So, I I just off the top of my head would do something around amount of money that could be brought in. Like, hey, I'm an hourly employee. My hours got cut, but I'm not bringing in as much revenue, but if I were to step back, I don't know. It's It's kind of a tricky thing. We'll have to And to be honest with you, I I'll probably speak up to some of the senior other business officials that have gone through it and see how they've done it. So, what's been successful? And I don't think it's a bad idea that we go out and talk to some of the other uh people in the community that might have a little bit of idea like like yourself, understand
052how it works and see how maybe we can relate to it to a a person that might not understand it as well because I look at this all stuff all day, right? This is normal stuff to me. I'm you know what I mean? But a good idea. So, if you know of anything or anybody I could speak to, I would love to love to hear it because we're me and Mr. Chandler are going to have to hit the road and get to this out to as many people as we possibly can to make sure that everybody's on board for it. So, >> or maybe maybe um instead of just holding budget hearings, a town hall or something. >> Yeah. >> Anformational piece for the public >> um or something like that. >> Absolutely. For me,
053I think it goes back to what Jesse talked about in terms of trying to keep things as predictable as possible. And if you have, you know, lived as long as we have and managed a household, you know, and understand the eb and flow of things. So, if your expenses decrease by 2% in one year, does that mean that you decrease what you put away? probably not because you've gone through those trends where it exponentially went the other way. So, you still want to make sure that you maintain >> putting in the same amount. You you know, and you don't really want to decrease what you're putting away unless you absolutely have to. >> No, I understand. >> You could also look at like purchasing a car like that like your payments interest rate. I'm just
054going through my head. There's a lot of different scenarios. >> Your your utility bill. >> Yeah. >> You know, instead of the swings going up, you go into like a budget plan, right? That keeps it flat. At least you know how much you're paying every year. So, >> yeah, there's a lot of different scenarios we could work through and come up with a good plan that will help people understand it a little bit better. It's a great idea. >> I think is the most important. I think how you say it is important too, but putting the message out there early and often and to as many >> opportunities as possible like all the PTAs, PTSOs. Yeah, I would I would >> I think any of the sports organizations that are have an association with them,
055talking to their leadership so that they can get their >> Yeah, I would encourage anybody that would like us to speak at a meeting or anything like that, reach out to us. I'm more than happy to sit down and and speak to anybody about about the budget or anything like that too because >> the more people we can get to understand it and do understand what we're doing and why we're doing it, I think the more yeses we'll get, right? So, drop down to like the negatives and not stay up in the positive. >> I I didn't Can you say it one more time? >> For the like 26 and 27, it's 2.25% rate. Um but then it just drops down to negative 1.18%. Is that a bad thing or >> Yeah. So with that
056decrease, that means we're not able to raise enough revenue to pay for some of the expenses uh that we're that we have with the district. So we have certain expenses that are pretty much locked in. We have contracts for salaries. We know that there's going to be increases year-over-year. So we only have certain amount of revenue or money coming in. The two big buckets are from taxes and from the state. the state is we're we have an idea where we're going to be at, but we're not solid on where we're going to be. The local side or the re the tax side, if we can keep it around that 2% and not really fluctuate a lot, we'll have a better better way to pay for expenses in the future. >> You have a job, do
057you have a job? >> Um, I'm actually about to get one. >> Okay. So, basically, you get hired there. The way I would think about it, you get hired at $10 an hour. For a year, you're making $10 an hour. Next year, they said, "Well, can't really do that. We're only going to pay $950 an hour, but your bills are still the same." >> Like everything you have to pay at home is still the same, but we're going to give you a little less money. And that's functionally what that is. >> That's a great There you go. Very straight to the point. >> Really, >> there's a a pilot is t is payment in le of taxes. So, there's that that uh that line that's coming down from Canada, I believe. Right. So what they're
058going to do is they're in a contract. Instead of paying taxes, we're going to get $1.2 million payment from them. But that affects your tax levy, how much you can raise. So that puts us in the negative. We're getting money and we will for the next 30 years, but that's that's when it's coming on that first year. So that's what's really affecting us. >> Oh, thank you so much. Appreciate it. >> Some great points, guys. Um, >> anything else on on uh I think the projected levy. >> Sure. >> Just asking that question really made me think we may want to sit down with some high schoolers and if you can find a way to make them understand it then and they have some suggestions, they may be able to give you some >> things.
059That's a good test, right? It's not a bad idea. >> You'll be voters by then, right? Huh. That'd be fun. I like that. >> Yeah, eventually. Yeah. Some of the high schoolers, right? >> There you go. >> I was going to test it out on my wife and then if she could figure out might not be a great idea, but >> yeah. So finally, I always like to show this graph and and what this is is that blue those blue lines are our total revenues of what I'm expecting the the next five years. And again, the farther you get out, the harder it is to project. But as you can see on every one of these lines, our revenue is less than our expense. So that what that means is we are budgeting in a
060deficit. And luckily in the past, we haven't had to, like I mentioned earlier in my presentation, we didn't have to go into that assigned fund balance. We there was increased revenues or the expenses weren't as high. But once we do, it really swiftly decreases. As you can see, that yellow line is what I'm projecting if we start using that assigned fund balance. Because the problem is it's it's kind of a hill. Once you start using it, your expenses generally don't go down. You have to refill that revenue the previous year and you might not get more revenue. So, you have to fill it with more fund balance and all of a sudden you're snowballing and you can't stop it. So, we we as a district leadership and a district are starting to really analyze all
061of our expenses in in a lot of detail. We're really looking at looking at decrease enrollment uh during negotiations really projecting out how this is not only going to affect the current year but future years per this this projection or or this calculation that we've been doing. So I think those really key things and really looking at everything that goes along and and make sure we're really the right size is could really push this out. The goal of this is to really push it out and not use that assigned fund balance at all. And that would push out the the the decrease at the bottom there where we're by 2930 we're in negative. We're in trouble. >> I had concerns about this, but Matt just explained it to me because I wasn't at the last
062finance committee meeting. So that yellow line is projection, but that's if we used it. We're budgeting. We are not you we have not we're not using it right now. Luckily we have not >> we projected so that line like in 25 26 is going down but it's actually flat we didn't actually use it >> right >> so these like 25 26 and before this is what it is projected but the the actual revenues were higher in a way than expenses because money the money was being put into reserves >> either revenue was higher or expenses were lower >> were lower we're putting into reserves fund balances. So, >> is there a way to explain that to the public? Because what at first when you look at this, it's like, oh, wow. We're our expenses are
063exceeding our revenues, but in a funny way, they actually weren't. We were we had the money, but they were just it was just in a different different area. >> Yeah. >> Well, right. >> It wasn't even necessary different area. It was budgeted this way. We were budgeting a deficit and using the fund balance to correct that, but we haven't needed. So then the the reality is the green has been higher than the green. >> The green. >> Yeah. >> Is there a way to make that to explain that to the public? Because when you look at this and it's and I talked to Craig yesterday looking looking at this like this it's like >> scary >> what we're we're spending way more than we're taking in but in essence so far >> besides beyond 26
06427 it's it's impossible to project that far out. But looking at this year or the year before the the graph lines actually shifted. >> Yeah. I you know what would probably help this is seeing the previous years the actuals. So you could see hey it it's been going up and but then this is the idea going forward. What I'm trying to show people with this is we are budgeting at a deficit which can come to a we're budgeting as a deficit. >> Right. In the past, we have not had to dip into it because of we've gotten unexpected revenue. We didn't, you know, use as much expenses. But once we start doing that, >> it's going to start dive bombing. >> But is there a way possibly for the past two or three years? >>
065Yeah. >> To flip and put the actual side by side graph Absolutely. of this is what we budgeted, but this is what it actually was. >> Yeah, I absolutely do. That's a great idea. >> I because when you look at this, it's very scary. >> Yeah. Well, it's meant to scare people. >> Yeah. But if I could Jesse, like the other part of that is he showed you the the slide earlier, right, with the the one point two 2.3 million 2.3 million of the actual fund, >> right? >> And it was 4.04% I think. >> Um, but that's the one he's mentioning. We've been bringing down from 2.8 million to 2.5 to 2.3. And as we do that, then we'll be budgeting less of a deficit, which should also occur this because that's the biggest
066thing. You should never budget a deficit >> if you can avoid it. >> I think the reason why we were doing it in the past is because we had that large fund balance and and we thought it was inappropriate for us to have that that much of a fund balance. So, we were using some of it to fund it. And that's why you do zero tax levies is you use it. But you can't you have to be cautious with that because it can get away from us. We don't want to rely heavily on using that fund balance because as this can show it goes away very quickly. And something to point out in this projection it includes some of those reserves including capital reserve including debt. So technically you can only use those for certain
067things. So we wouldn't even be able to use all of it in a given year. So this really if we started using reserves and started using auto fun fund balance this would dive even quicker than this. So >> current school year's budget you said we have not used any of the >> not I mean it's very early >> but uh in the previous years the three years that I've been here we have never used any of the unassigned functions. >> Okay. We budgeted it, but we didn't hear >> we budgeted it, which I I I'm not I I don't disagree with budgeting it because I also think if we're at a certain point, we should be giving back to the taxpayers. So, if we didn't use that assigned fund balance, our unassigned would be double,
068right? So, we would be at four four million, which would put it above what we believe we should have in reserves. So, I'm not saying that we shouldn't use we have in there, but we should be strategic on lowering it to an appropriate rate that we're able to control it a little bit better. >> And we we have the liberty of you being here explaining it to us. That's one of the differences, too. >> Thank you. So >> um not really part but whenever we do get money from the state and our taxes and stuff and like the extra money that we have can we not put it aside um so that when we like the new year starts and then we have like a new plan we can like join it together so we
069have like more money or >> so there are there are rules to where we can put our money unfortunately. So if we went if I went back and I was talking about uh reserves on our other side >> page five okay >> there it is >> our this is what we have in our our savings >> but each one of these savings account have only they have rules what we can use it for. >> So and then this one that says unassigned fund balance which is our largest one legally is only capped at 4%. So, I'm only allowed to save 4% of what our next year's budget's going to be. So, uh we've made a conscious decision to be a little bit higher than that because we feel that the 4% isn't enough. Um but
070but and that's why we get written up every year in our audit. So, >> there are some rules. We can't just sock away money and then use it how we see fit. It's a great question. >> I mean, that's just how I view it. >> I have a question. so much you can do. >> Maybe more of a question for for Craig. Um, seeing the questions that Hike has raised tonight. Um, would it be a possibility, I know the finance committee meetings meet during the day, but near the end of the day at a future meeting to be able to have her and Jesse attend one to um, >> Owen, you mean? >> I'm sorry, Owen. >> Everybody's >> attend one to um, get, you know, be able to ask Jesse these questions and get
071a better idea of that. Absolutely. >> I'm thinking I'm thinking we're going to make it available to high school students anyway. >> Right. >> Um >> but no, absolutely. If you think it's >> just based on this like I you know I think this is good and it's productive and if we have kids that are interested in knowing more >> come over here are going to be able to vote. They're going to be future budgets. >> Tell Mr. S got to make it a requirement in high class. >> I don't understand how people aren't required to because when I was in high school you had to go to a board meeting. >> We it used to be until a few years ago. >> Yeah. And participation pre it was required. abortion. >> Fame. I was
072required >> several. >> Yeah, >> you had to come. You had to do a couple a year pre-COVID >> and it's gotten loose since then. If I could be nice. >> Don't worry, Hiker. You got it covered. >> She gets this extra star. >> No, I mean they were good questions. So, so >> yes, they're great questions. >> Well, I mean, you are targeting a population that can potentially vote and might not necessarily, but if they know their votes going to really matter, it might motivate them more. So, I mean, anyone that turns from January, December. >> Yeah. No, Craig and I had a great conversation with with some seniors uh few months back about budget and what they're looking for and that kind of stuff. So, it was a good conversation. It's better than
073I thought to be honest with you. >> They had some great questions and great go back and do it again with this. Yeah, >> but civic engagement is something that's dying. So, get out of it. >> I'm not the person you should look for at all. Like I try um my best um and I don't really use excess money like that, but like when I see something I have this urge to get it and I feel bad after and I feel guilt. So honestly, budgeting is not my thing at all. >> Here's the thing. It's not just students. Like if you think about it, there there are so many community members who have a lesser understanding than those of us sitting at this table and you're representative of that. So, you could also be representing
074a 40-year-old stay-at-home mom who doesn't have to do any of this kind of stuff, you know, and looking at it through the lens of explaining it to you will help not only students, but it will help the larger community who might not understand this. >> I think it's great. >> That's great. Great point. Yeah. I'm I'm always been pro like people learning qu ask asking questions because the better that you and the taxpayers and the staff and the students understand why we're doing things makes my job a heck of a lot easier. So any questions don't hesitate question and you know email me. We can set up different times to meet with people. I'm all for it. So finally I just wanted to go we got state aid numbers again very early on. uh they
075can change and they usually do. Uh the big number you really want to look at is that foundation aid. Uh so last year we got about a million dollar increase in our foundation aid. Uh this year we're looking at about 150,000. Uh so only about 1%. >> Numbers from today. >> Yeah. This week. >> Yeah. So this is the other ones are more expense driven aids and those are based on num uh estimates. So, in a future date, I will do a better analysis of these because these are based on estimated numbers that that I put in in August, but now we're halfway through the year, if not more than halfway through the year. I'll have a better understanding where we're going to be. So, I will adjust these numbers to where I believe we'll
076be next year >> because they're based on the total of what we spend in this school year. We're only halfway through it. >> That's correct. >> What is high cost? So high cost aid is for special ed students within either Boseis or our building. So they have to have a hit a current threshold. So there's a calculation that has what they call like a local deduction. So for for high cost aid it's a higher number. So you have to say an individual student cost the district well let's just say off top of my head $80,000. Okay. the the threshold for it would be hey you have to to get aid on it has to be over 60. >> Okay. >> So that $20,000 will be aided at a percentage of our our high cost percentage
077or I cost I'm sorry our high cost aid. >> So why such a big deduction? Like why a 44? >> It's all based on uh I wouldn't even look at those because it really is based on I put an estimated number in August. That's what the governor gets. So what that is is I said I think there's going to be in August less expense there or less ability for us to get aid, but I know now that there's more kids that have come in, >> okay, >> and that are going to hit that threshold and we should be getting more money or less money. You know what I mean? Okay. >> So, >> that's why I said don't take a lot don't take a lot of >> I just wanted to show it to you
078guys knowing that it's out and this is kind what what I'm looking at now. That foundation aid is really the one >> that we're not sure where we're going to be at. The other ones are a lot easier to estimate or to be able to uh calculate. >> And you probably know this too, but yeah, that foundation aid, that's the governor's number. Traditionally, the legislature raises it. >> Okay. >> There's no guarantee. I don't think personally, we've talked about it. It's probably not going to go up very much this year. They're probably gonna leave education pretty flat. >> So, >> I would love to see 2%. I would love to. I'd be happy with two. >> You didn't think last year you didn't think it was going to go up that much and it was
079like a million dollars more, right? That you >> was at No, we I knew it was going to be a lot because we were still on that formula and we were below the formula. I knew we were going to get a significant bump. We did end up getting more after that. Um, and to be honest with you, we're not going to have the final numbers, >> right? >> And we're going to have to adopt this budget, but after >> I know Craig does a lot with the legislature, we'll find out, hey, you're going to be at 2 or 3%. >> So, we'll have a better idea further down the road. >> A pretty good idea. And it's an election year, so we know it's going to get propped up at least a little bit. But
080they also after the last couple years of foundation aid adjustments, increases, they feel like the general legislature has a feeling like all right, we've done right by schools. We got them where they're supposed to be. Yeah. >> So now we just have to go with these basic increments >> for Craig's right. I always keep forgetting it is an election year. So >> and now that we've gone through the formula and they've corrected it, we are looking at fewer large increases than we have in the past. >> Flatten down. So again, very early on, don't want to panic anybody. >> Enrollment affects that. Number two, >> enrollment does have effect on the foundation a calculation. There's a lot >> if you ever want to go into the foundation a that is you need to set a
081late at least a couple hours and come to my office. >> No, I don't want to. No, but I'm saying what I'm saying is the fact that the uh the enrollment has been going keeps going down that strongly affects >> a large the two the the three things that really affect this is enrollment because it's pure pu per pupil and it's the property value and the um uh gross uh income. So we are seeing that increase but also that takes in account the whole state. So, a big driving factor that a lot of people talk about is New York City. So, if New York City has large swings one way or another, that can affect the whole state. So, I'm not I haven't gotten the backup yet from how we got to this number, the
082calculation, how the state got to, but once I I do, I can see exactly why we're at where we're at. That's all I got. Any more questions? >> Thanks, Jesse. >> All right. Thanks, guys. Appreciate it. >> All right, that concludes the budget presentation for this evening. I am going to ask for a motion to enter into executive session to discuss matters pertaining to the employment of particular individuals. Thank you, Mike. Second, Jenny. All in favor?