001all right um kathy do you need to call the meeting to order it all or um mr russo mr russo will do that for you yes okay good evening all i'd like to call the meeting to order at uh 604 pm mr sprang you have the floor sir okay thank you very much um you should have uh the report i'm sorry we didn't send it out friday um you should have gotten it yesterday i hope everyone got it i'm gonna just point to a a couple of the uh i think the important uh statistics in it and um what i'd like to do is um look at the school budget in terms of the number of school months that are gone because most most of our expenses really go over 10 months of the year
002not 12 and what i point out there is this reports through the end of october and so uh two of our ten months are completed uh with this information and what you can see is uh we've spent 28.6 million dollars of our 139.6 um operating budget and that's uh 20.4 of the total so it's pretty much lined up with uh where we might have expected to be at this point but um a couple of things are starting to show up and and the first one is uh prices and uh we've all heard you know you just have to turn on the news to see what's going on um with general economic conditions uh we we've only really seen some isolated uh sharp increases on different things nothing that would uh represent right now calling uh
003an alarm but it's something um it's going on and and we're not immune to it so um we'll have to um stay alert uh but but in there uh one of the concerns i i've been developing uh has to do with oil prices uh as you know most people didn't think they'd stay high for this long and they are high we've just started the heating season and so we're going to be watching this very closely if you could in your reports if you look to the i'm going to ask you to point to the fourth page and i'll i'll start numbering them it's the the line item uh individual line items that make up our budget and the page that uh starts with transportation special ed when you go down that page you'll see the
004line item for fuel for buildings that's our that's our heating oil line we had we've budgeted 273 000 there and uh coincidentally after i prepared this report um i we have a electronic approval process for purchases and i was asked uh to approve a uh purchase order encumbrance for the entire year for our heating oil and it was up um a little close to three hundred and ten thousand dollars as you can see our budget is 273. so we're going to be a little over on that one i didn't think it was um that large that we needed to take any action uh tonight or in the very near future but it's it's based on that overage is based on the heating season we had in 2018-19 in terms of the number of gallons we
005use that's of course the last time we were open for for 10 months but so much depends on the weather and how cold it is um so it's just not you you just can't say right now oh but i'd say it's it's on our radar you know we'll we'll have more to save on that as the the winter goes on um so that's uh so prices are starting to creep into our our budget um uh with both of those things uh the second part of the report last month you asked about health insurance and i think it was because when we looked at the end of the year last year we returned to the city of 2.8 million dollars and if i recall most of that a couple million came from health insurance and as
006we talked it was uh really because when hospitals uh i use the word were overrun with covid uh patients uh for you know four or five months of the year people uh put off going for different surgeries it might have been elective or deferred and and there's been a lot written about that but that's that's why we turned back uh money uh last year so you would ask me how are things going this year so far and we did ask our uh consultant am gallagher uh to look at the claims a much more expert than i would be and so what you'll see in the report um good stuff let me just turn to it it's uh towards the back there's a a long sheet it says stanbury public schools i'll just i can't share
007the screen but uh what it is uh gallagher put this together and they went back to uh july of 2018 and month by month uh showed our claims as as you know we self-insure for health insurance which means uh we pay the actual claims to come in uh plus uh something to cigna to operate those claims as a cigna plan but it's it's self-insured and you can see um they broke it down the total number of employees that had health insurance um and then what the different claims were medical rx's prescription dental and vision with a total so you can look down you can what i did was i looked at the three comparable months um i looked at uh july august and september of 2018 and uh really in july august september of 2019
008those were normal months and compared that if you look at the bottom of the report there's the three most recent months uh there and um i i spoke at length uh with gallagher and said you know how do you interpret this and what yeah i got was an email from them and that's also part of your report you'll see from uh steve scholl is our consultant dated november 4th and i won't go through all of it um but the main point he said was that our claims were running about 1.9 million a month uh he thought that was um as expected kind of his words but at the very bottom of his email he says to us um don't don't put my words don't go spending the money yet because they expect there to be
009an uptick in elective surgeries and deferred procedures that people have still been putting off they expect that to happen and that would uh raise our our claims and and his words uh time is the only way to see uh this impact maybe to us uh i i pressed him a little bit on you know if he's telling us what the industry experts say uh what is the consensus of when this might start and he just they just don't have a time uh that they're they're saying but they think it will be during uh this plan year so um another thing i i think we should uh watch each month and and um hopefully our next meeting i'll i'll have some more information on that so john can i can i ask a question of course
010okay so um with the uptick of oil prices and the uptick of the anticipated um elective procedures coming our way are you going to put a moratorium on spending right now uh well i haven't uh talked about that with the superintendent i think it's it's time to consider what choices we have there may be other choices in there one of the things that happens though in a public school budget is a lot of the spending is front loaded meaning teachers want their things before school starts the books are for all year long and materials um so when you do put a freeze on um it generally tends to uh affect the the spring activities a little unevenly you know for example the fall sports are all done uh so if you were to cut back
011there it would hit your spring sports um a little differently than if you had done it all year so you um those are their strategies that schools use but um you gotta be kind of careful with how you you put them out but we'll we'll be talking about those and and other options that are that are coming along um and we'll see what things um have gone our way uh there are a few uh when it comes to mine you you've heard how how difficult it's been to fill positions yes and to find substitutes so i would expect in those lines there would be some favorable balances and uh as we get closer to the the middle of the year um maybe those can be transferred or well i think we'll have a better picture
012once we get right after christmas but it's not too early it's a point well taken john john speaking of um not too early and thanks for getting us started um can you speak briefly about the reserves and at what point um does this trigger a conversation with the city about reserves specifically for um you know potential uptick in in claims and requests you know well i think the first one um you know if remember there are a couple different reserves but most of them are related to health insurance right maybe half or more and uh when we talked to david saint-hilaire that's exactly what he was saying is that uh because of this expectation uh they had reserved money just in case so um that i think that's the first place we should turn for
013help because that that's what it's there for um but i i think that um probably january would be a good time to say and you know um for them to release reserves they're on their balance sheet which means it doesn't have any impact on the city surplus that stays what it is and whatever gets added to it when the audit's finished uh this is in a very different place and would have no impact so that's that's a strategy i think we'll look at very early as well and you know they also have something for uh just general i think it's maybe 500 000 uh what a perfect place to uh get your fuel budget uh overage from uh because uh you know the general uh thinking is fuel prices will come down so i think
014bar taking from the reserve wouldn't lead to any spike or really wouldn't impact how we budget uh for next year so yeah we'll dust off his memo i think very quickly thank you john yep uh so also in the report uh this month uh we've been promising you and finally we have it uh some of our grants and i think it's on the last page uh we thought uh we talked about this but we said you know why don't we just uh in the report show all the grants uh even though some are the same some are small and um don't have a lot of impact um and clearly the coronavirus relief grants are the name of the game this year but um we said you know for the report um let's let's just put
015them all out um we can talk about um how we want to do our reporting going on but we just felt um that was the way to go um and um the list of look i'm not real familiar with what you were getting in the past but but i can say that it's noteworthy it has to be noteworthy uh the the big grants that we have uh the virus relief grants and you'll see them right there if you look down um we use an internal number to keep track of things but grant 29 about eight or ten rows down is the yes or two and you can see that's close to six million dollars uh so that's in there as we um we do have some um accounting um record keeping we have to do
016to uh with that grant and if you look down at grant 37 the sr3 grant because we we didn't have those grants entirely approved and in place um when the school year began and went and certainly when we had to start getting people ready so um some of the new people and some of the people that were earmarked uh into those grants in june uh right now they're either in a different grant or the general fund uh because we we just had to get them into the process and get them going uh but what our software does is and we're in the process of doing that is we we know the people that belong in the uh new grant again the plan we adopted and the new software's is pretty good with that you can
017just simply locate the person in the in the system uh give them the new code where they belong and not only does it code them going forward but it brings all their history with them so it's it's a pretty easy process to it restates um what what you've done so i think it'll look um much different to you next month meaning um a more of a share of a more normal share of the grant will have been expended because those big grants are primarily for staff as you remember whether it's the brookfield kindergarten or some of the extra teachers at the high school and those things are there they're predominantly staff so you'll you'll see some changes there but those you know two grants here's 13 or 14 million dollars right there you'll see the
018cares act grant on there that's almost another million so um right away our total grants are up to 52 million dollars typically they've been at least the last few years even with um when the alliance was lower they were uh in the 40 million dollar range or below so you you see that effect there you also see the alliance grant at a higher level i think we talked about that the board meeting it's gone from 14 million up to 17 million and uh if we have our way it's going more higher than that um next year and we're working on making that happen so those are the grants um and although that's uh the end of the the first page of the report i'd also like to uh speak about transportation before we we leave
019the reports but questions on grants i have a quick question please um i'm just looking at some of these line items john and i'm just um maybe i'm missing something but we're running a negative balance on grants right how is that possible those would be people that were put into the wrong grants when when we knew people were grant funded and we didn't have the grant quite approved well probably the most famous one is our our title one grant um they approve that every year in november and we've had it forever we have teachers that have been on it forever and you know come september they they have to be paid but what the the software does is when it uh the way we've programmed it um before a teacher gets their first check and
020we're loading them in uh we put a we encumber their salaries it's not a purchase order but if a teacher is earning fifty thousand dollars and uh we get ready to pay them uh you'll see an encumbrance out there so what what you're seeing here in the grants that are overspent it's because people are in the wrong spots and we've taken their their whole salary you kind of get used to it with the state's way they approve things kind of late particularly some of the what we call the entitlement grants um you know how much you're gonna get um you're asking for the same thing and you just but it's time to start school so yeah and you have to you have to wait until the grant actually comes through to catch up yeah it's
021easier for us to get them in the right fund um if they're in the grant fund or in the school lunch fund or the job wherever they belong it's much easier to correct them later than if you're trying to go between funds there's when you do that there's more journal entries and sometimes you got to write checks [Music] john thank you thank you thank you for clarifying that point and kate i just want to also mention um so as an example because john he used a really good example talking about the title grant um but all of the title grants actually they're not even open until school starts correct so that's title one two three and four as an example um they're not open until school starts and we do have salaries coming out of
022of of those of those grants in addition to supplies that are typically ordered and then to john's point then we you know they they do their shuffle in the finance department and start you know moving folks back uh to the appropriate areas where they belong i just okay i'd like to add kate if i could to that i i don't want it to seem like that's the only thing going on um it it was quite a startup this year um getting everybody hired through the hiring process it includes fingerprints and background checks and all that i mean you've heard of the number of new people that were hired and just just the vacancies trying to fill them um so it was it was a strain on the the payroll department to get people paid and
023get them paid the right amount and there were times where we said even if we don't know the accounting uh we'll do that later let's get them in the classroom in front of the kids and we'll we'll sort it out later so it wasn't the kind of startup i think we've had before it's certainly not what we're going to continue with but there's some effects of that when i look at it i see so full disclosure i do want to just look at lion grant number 135 which is education jobs fund it's a twenty thousand dollar grant that's listed there and if you move over to the some of your to date transactions you've got twenty one thousand uh thirty four dollars and eight cents so we only we're only a little bit over which
024is the 1034 uh uh but i can't imagine maybe i'm missing something it just doesn't make sense to me how that would be a salary based issue there okay i'm sorry line item was it again uh 135 the education jobs fund okay guys i'd like to look into that i can it won't be hard to answer i can email people it's not a lot of money i think you know it's it's more a concern about you know how do we make sure you know for for us to look at this when we've been looking at these budgets you know your explanations certainly help round out how we understand it um but you know if there are discrepancies that are happening beyond that i don't want to you know we're three months into the school year
025almost already and you know we need to get these things ironed out because we we're going into budget season we need to be able to prepare that with with uh a clear perspective of what's happening what money is coming in and what money is going out of the district and what money we've set aside to do certain things um so you know you know i can certainly appreciate the the the task before you is substantial but i do want to just make sure that we tidy that up because um you know those are those are questions i have even as a taxpayer yeah in the city so thank you thank you um transportation okay um so we were asked um i don't know was that the board meeting itself or or it was one of
026the it was the finance meeting yeah john it was our last finance meeting and it was a it was a question number one about um is our contract with sta ending soon um and i had informed the committee um that we had actually just extended our contract with sta um however it it did come at us at a savings um and so i thought it would be appropriate at this meeting since this is where the question was asked um if we can just kind of review those savings and and kind of the details of the contract you know and i i when i looked at it uh closely um i'm not sure they they were paying it i shouldn't say it's on film but i'm not sure they were paying as close attention as they
027could because i'll explain in a second um so uh last year last spring uh the sta contract had one more year to run it would have been uh this year suspect that was the fifth year about five year and is as is pretty typical of school buzz companies rather than uh face a competitive bid situation where they have all this investment of vehicles and capital and people uh they hate to lose that if they can avoid it so it's it's almost common that towards the end of their contracts they'll come in and make an offer uh to extend and that's what happened and but their and their offer was kind of typical too they said um instead of uh going into our fifth year with a 3.5 price increase let's rip up the contract and
028let's start a new one and we'll give you what they call a zero percent increase will hold the the prices flat for a year and that's it's always pretty attractive to school boards especially when they're facing a tough budget and this is one of their biggest line items so we did that and then there was a three and a half percent escalator put on the remaining years which is you know not far from inflation really so here's a pretty good deal uh for the foreign foreign computers below but i'm going to share it now the letter okay um so but here's here's um even a little percent like that on a big contract with us yeah this is uh and it's it's normal um when these contracts get uh changed it's done in a letter
029format both sides sign and and away you go so um but the zero percent increase um our price per bus per day is 386 dollars sounds like a lot but if we had put a three and a half percent increase on that instead of the zero that would have been 13. per bus per day it doesn't sound like much but we have 119 buses on kevin if you can show the other uh page and uh we run them for 180 days and so when you do that math out um it's it's close to 285 000 that uh it's a cost we avoided in the current year budget but my my comment about maybe they weren't looking as closely as everyone thought is you know that um that holds down the base so that 280 000
030goes through the life of the contract that they never get that back um i mean it's hard i'm sure when we're selling our budget and the three and a half percent increase it's it's like anything it's probably like you know when you hold your teacher contract down for your people forget pretty quickly but that's a lot of money um to get each year um we can we can send that around uh tomorrow too um the other thing they did there were um ten new buses that we we budgeted for for um the damn the primary center and what they said was in in the letter that they would uh not increase the prices of those for the life of the four or five years you can see it right there in the near kevin's uh
031cursor um [Music] there the addition of 10 program will will remain at the current price for the duration of uh the contract so so that was pretty good and then uh finally and i don't know the background of this but um they agreed have agreed um to you know they um they pay for the um they hire the bus monitors uh that we have on mostly our special ed buses are smaller buses and um they passed that back to us and but what they said was uh they would for the danbury primary center they would pay the cost to the monitors for the year um you know it's eight people eight or ten making let's say they make i don't know twenty thousand dollars each um that's money too that we we don't have to
032spend so um i i wish we had had these specifics when we were asked uh what did we save um it took a little while to dig them out but when we did it it looked like a good deal for us so i thought it was important to bring that back tonight thank you john i'm the one who raised the question the last time okay i appreciate your deep dive to give me a very legitimate answer sir yeah i just didn't know what that when you mentioned i knew we saved money but i didn't know how john when you're when we're factoring in these costs for the buses and and you know the fuel or i'm not sure if the contract is structured in a way that we're paying them you know a certain amount
033uh per per gallon of fuel or whatever or if it's a flat you know a flat amount that they're that they start us with we pay for the fuel we pay independently for that fuel yep so what line item does that appear under is it the one i pointed out under the heating oil i think it's two below that says propane fuel um all the buses are are propane powered right um yeah so we buy it um in combination with the with the city uh they bid it out and we we pay the price we take you know economies of scale we've allotted three hundred and eight thousand dollars for that right so i'm assuming that next column which is reflecting a zero we we have to have used fuel by now right because we've
034been running school for two and a half months so um there's a uh that well the tank they have a gigantic tank over there um and they've been using what's in what's in the tank which which we purchased last year the or or whenever that the tank went in um it's funny you should mention that because uh my email in the last couple hours from beverly in accounts payable she's was saying um there's a purchase order for me to approve uh for propane i think we've run out or we're about to okay okay um and so i guess then my other question would be about you know the buses and the sta contract i i would assume that that shows up on a light line item as well um and i i would have thought
035it would have appeared under pupil transportation which is uh um but to date we've only spent 421.50 according to this line item so okay so um very briefly as maybe more information and you want to know um we we got what we thought was our first bill um just the other day and um with our new transportation coordinator we're going over today and i i noticed it was for november you know they built the beginning of the month which is another problem but i said to kelly um hey you know we don't we haven't had september and october when you're over at the terminal today why don't you ask them did they send it or what happened so she she came back and you know sta was recently sold and you know they've done certain
036things they're not the they're good still a good company but um they do things differently and what we learned was the person who does the billing [Music] in early september went on a paternity leave uh for a month and uh didn't come back was supposedly so they had someone else uh a woman who was brought in was supposed to do the october bill and she said they she moved to florida so they they haven't billed us we haven't been invoiced right john and i were just talking about this so i mean obviously that presents an obstacle on our end because we're sitting here trying to figure out how we're going to squeeze well we we will get we will get the invoices though and we budgeted in those areas and we will uh we can
037encumber it especially we know how many buses we're running you know what they cost per day these bills look pretty similar month in month out so okay so can you then talk and and i apologize i just need a little bit of clarification because this this information looks different to me than and i know we had it last month as well and i sort of was like not not not fully digesting everything but now in looking at this october report we've got the budget column and then we have the expenditure column the encumbrance column and then the unencumbered balance can you just help me understand and i forgive me because i'm just not a finance person so i just need a little help understanding that because i'm looking at like the people transportation for example
038and we've got a budgeted amount of you know five million dollars um and of that three and a half almost three and a half is unencumbered right and there's there's also more in the next page um the special ed transportation yeah is a separate line item uh that's because uh the state of connecticut wants it that way at the end of the year we uh it's a different reporting but um of course the budget is what it says in the expenditures those are those are checks that we've written um government accounting is uh cash basis accounting um rather than accrual base you you show your expenditures um in the month that you uh incur them not you don't accrue them and reverse it the next month it's i i don't know why it's that way
039but our expenditures are not accrued they're actual checks that were written and then um the so the third column the encumbrances um i like to tell people those are those are purchase orders um that we've issued uh that we haven't paid so what we try to do with the encumbrances is show that not only let's say we have a budget of whatever we've spent some of that budget but we've obligated some more of it and so we subtract from those two columns from what we've budgeted first home what we spend second column what we're obligated to spend later and then what's left over is the last one we call it the unencumbered balances where they came up with that name either it's cumbersome um yeah yeah and so um but what makes a little different
040is um that column of encumbrances isn't just purchase orders uh because we're such a personal services business and most of our budget is salaries we we put aside when we hire someone we set their whole salary for the school year as an obligation so that we know do we have anything left or do are we over because particularly with the teaching lines you know we'll do our budget and maybe we'll know people are retiring or not coming back but it's it may not be until the summer that we find out what step we're going to put people on so there could be some differences there when you you finally do your hiring so that's the four columns and then i just have one more question i promise i'll seed the floor um i just i
041want to get a sense like for the encumbrances that that you're talking about the pos that you're talking about um obviously if you have a salary rate that that just goes the way it does if you have if we're working with a vendor like sta for example um and we know like we've signed a contract and this is that you know we're spending x number of dollars this school year with them is that taken into consideration in the encumbrance or is it like a a monthly thing i just i'm not clear on that piece um but what i'd like to do and and you'll see this next year and you'll see it as the year goes on is um once our budget's approved um we're allowed to obligate it we we don't have to wait
042till july one once so everything's in place and you can't wait till july because you won't have your stuff in the classrooms if you wait till july so what i try and do is for the things that we know we're going to have every year like transportation i'll use your example we'll uh prepare a single purchase order uh for probably the entire budget amount if we still think that's a good estimate and then each month we'll reduce that by probably 1 12 or 1 10 whatever it is as we write the checks we reduce the encumbrance by the same amount as it goes down now maybe we'll find like in the case of fuel our budget really should have been a little different we might even change out of conference because what we're we're the
043the point we try and make as we turn the year into january is we want good data as we said the next set of budgets so it's important to to keep that up but we also and you'll start to see in my reports we're going to try and predict what's going to be left in june if nothing changes like the the 2.8 million we had returned this year yes it was for health insurance you probably could have seen some of that coming and what i'd like to do uh with both the cabinet and the board is saying you know if nothing else changes will our unencumbered balance on june 30th will be 400 000 say and then you as a board can decide with the authority in your operating budget um do you want to
044um just let that go uh there could be reasons for it or has there is there some need that has come up uh maybe something you had to cut in the following year's budget you say hey let's pre-buy it now since we have so i'll be trying to give you uh their forecasts of what's left and by encumbering as much as i can in encumbering more than we have now uh that's our way that we do it so okay yeah it just it just seems like that that unencumbered column you know certainly if you look at the the end of the report we've got you know almost 29 million dollars unencumbered so the um you know i i if i'd been here i shouldn't say it that way next year in july in august that's
045when we'll we'll put our encumbrances on and and um it has been a difficult start we've had a lot of a lot of turnover in the finance office and we're just we have our head above water now and we're we're we're swimming and we're going to see some of these things uh come on in time to make those uh forecasts for june 30th excuse me john the school lunch program is that included in uh other purchase services and do we have a breakdown of that budget uh we don't it's it's a a separate fund uh what you're looking at here is uh you're looking at two funds the general fund and the i'll call it the grant fund um the school lunch fund is not in in tonight's report um i i i don't i
046think it because it's it's what you might call an enterprise fund meaning um it it lives with its receipts it's it's self-funding so they really don't set that budget ahead of time um they have to they have to break even so it just it's not reported the same way i don't know if i'm explaining it but i get the direction you're going to because money comes in also i'm a certain amount of students okay right and and what what we can do though you know it's particularly given uh where we were at the end of the year last year uh with the lack of revenue coming in and the situation that it put us in um you know this there's no reason why we couldn't give an update i don't think it's necessary to really
047give a monthly update but you know maybe quarterly or kind of bi-annual update at the very least um because as long as the the school year is normal i don't think we're going to have any issues with the type of deficit that we had in the last two years um and i mean i i think if we can show that this year um i think the board will be reasonably pleased that you know we're not going to have you know deficits moving forward and i don't think we can have any issues as long as we have regular school we certainly are on our way right now thank you that's certainly something we can share you know january february and we'll have a pretty good look of what our projections are for the rest of the
048year absolutely that's kind of the long and the short of the report other other questions has the audit been is is that finished no um we're having a meeting uh tomorrow uh morning you know what's happened uh with audience kind of they're going through a change too the the profession i saw something this weekend uh chairman of uh bryce waterhouse one of that's one of the biggest firms announced that um uh all of all of their auditors could work remotely if they wanted to i thought was kind of startling because what we're seeing is um our auditors are are working remotely more and more they're not not here as much as i i think they should be uh but it's harder to to do um when they're on site uh they you know they're they're
049with you you know for days and they say hey can i see this and you hand them a binder or something yeah i'd like to know this so you you answer all the questions um quickly it goes much faster um here they're they've asked for same things several times they want them scanned dropped into a portal and we don't have the give and take to talk to them and so they they it's it's slower it's probably a sign of the the way things are going to be um but i i it shouldn't be taking this long um i i think it took a long time last year from what david saint-hilaire tells me but i i had expected it to be faster this year so hey john just to piggyback um kathy uh as john
050mentioned you know the auditors did come in and they were here for literally less than a week um and we were under the impression we gave what we needed um you know frank uploaded a great deal of amount of stuff prior to us arriving i've uploaded a bunch of stuff you know john has um we are meeting with them tomorrow um virtually of course uh just to iron out anything that's left over but it is taking a lot longer we were hoping to be done by now november they were walking into but um it seems to be like as john mentioned um having the otter as in in the building and kind of you know stopping us and you know having us there for you know six to eight to 20 hours and just pulling
051reports as much as we can for what they need um you know has kind of extended this audit a little longer i can't even imagine doing it virtually it must be a nightmare and that well whatever i just hope it works well that's all thank you all right i'm good are we done mr russo i am done thank you if there are no other further questions i'll entertain a motion to adjourn so moved i will second that thank you made by kathy seconded by kate good night everyone