Stamford schools short $3M — and it’s not because of mold
STAMFORD — Based on current projections, Stamford Public Schools are running several million dollars over budget this year.
The official deficit estimate is $3,153,847 if spending continues how it’s been going. Director of Finance Hugh Murphy recommended in the district’s second quarter financial report that the district freeze hiring, overtime and discretionary spending, as the board needs to legally be within budget and cut back expenses by the end of June. The deficit does not take into account $201,000 the Board voted to take out of an energy reserve to cover an unexpected electrical surcharge.
Clarence Zachery, chief fiscal and operations support officer for the district, said the number also does not reflect additional funding for mold remediation. The Board of Finance will be deciding Thursday night if they will approve a $702,593 supplemental appropriation for the Board of Education. However, the funds have not been approved yet.
Superintendent Earl Kim said this deficit number does not account for mold-related expenses that’ll be charged to the city and reduce the projected amount of debt. However, special education and out-of-district tuition have been some of the biggest drivers in the budget.
With offsetting from other funds, it’s estimated there may still about a $2.25 million deficit if spending continues as projected. But the district will need to make cuts to make up that amount in the next four months given it legally cannot end the year with a deficit.
At a Feb. 26 Board of Education meeting, Murphy said salary and wages are trending about $310,000 over budget instead of $100,000 to $200,000 under which is usually the case. The increase is due to 16 additional positions added at the start of the year. There is also a predicted $276,000 overage in teacher extra services on a $100,000 budget.
In all, there is a $891,000 predicted deficit in the teacher account. Murphy wrote in the second quarter financial report that he recommends vacancy savings be used on wage accounts.
Employee benefits are also predicted to exceed the budget $149,000 due to increases in Social Security, which is not covered by grants. The health insurance internal fund is predicted to run $728,00 over. Murphy said he hopes the surplus predicted in premium cost share will cover the discrepancy.
There is also a predicted $848,000 overage in pupil services, Murphy said, due in part to new therapeutic classrooms that led to added costs, but not a reduction in out-of-district tuition.
“Savings in the the tuition account didn’t show up as much as we anticipated,” Murphy said.
The tuition account is also projected to run about $982,000 over due to out-placements, parent settlements, moving students into the districts and increases in service requirements.
Maintenance and repairs costs are also projected to run over due to mold charges and electricity has also gone over due to the surcharge. Murphy said the rest of the accounts are either in surplus or close to budget.
Board of Education members were upset by the news and its timing, coming two weeks after the board approved next year’s budget. Nicola Tarzia questioned if the deficit was a result of last year’s budget being tight with only a 1.5 percent increase.
“It wasn’t because the budget was too tight,” said Kim. “If you look at what drove the negative balances, there are a number of areas we have been working on — better management control around the use of our paraprofessionals, managing our legal fees ... but there are a number of areas where there are unforeseens.”
Board members were not impressed by his reasoning.
“We’re really flying close to the sun on some of this stuff,” said Jackie Heftman. “This is what happens when you get a 1 percent increase instead of a 4 percent increase.”
Surprise costs is also why Murphy and Zachery claimed they couldn’t approach the board sooner about the deficit, blaming its sudden hike on several large out-of-district tuition costs totaling $400,000 that just came to the district.
Zachery and Murphy said they’re beginning the process to “try and find savings.”
“We’re running out of alternatives,” Murphy said. “We’ve got to come up with the money.”
According to Murphy’s financial report, the two are hoping for an additional $313,000 due to cuts and purchase order cancellations in supplies, materials and heating fuels and $185,000 expected to be left in the equipment, dues and fees account.
Murphy’s report also recommended focusing on cutting back on special education and maintenance.
Board member Jackie Pioli expressed skepticism on the idea the district could cut back special education when it’s already driven the budget in such an unexpected way this year.
“There’s no way to say by the end of the school year that number’s not going to grow,” said Pioli, an advocate for special education families. “I wish we would’ve known about it sooner.”
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