A time to cut? Tri-board meeting considers budgets
A consensus that extraordinary times may call for extraordinary fiscal measures was shared — though no specific financial actions were taken — by town officials at a special tri-board meeting Thursday night, April 23. And 9 out of 10 speakers from the public during the Zoom meeting urged restraint on potential cuts to the school budget.
“Consider the kids’ needs,” Mira Jensen told town officials. “They are our future and they are our town’s future.”
The joint meeting of Board of Selectmen, Board of Finance and Board of Education was called after the selectmen, on April 1, discussed rescinding their previous budget votes and reworking the proposed budget for the 2020-21 fiscal year, which will start July 1.
On April 1 First Selectman Rudy Marconi had presented the selectmen with various scenarios, including one in which both town and school budget were reduced to 0% increases, and another in which the spending might rise some but town’s roughly $15 million surplus fund balance would be used to hold the tax or “mill rate” increase to zero.
The tri-board meeting began with a look at the fiscal difficulties that seem to lie ahead, with much of the town shut down due to the coronavirus, many people out of work, and tax revenues likely to decline.
The night before the selectmen had approved two different tax relief programs that will make it easier for people to delay tax payments to the town for up to three months.
“For sure we’re thinking we’re going to experience the possibility of diminished property tax payments. How much we don’t know,” First Selectman Marconi told the virtual gathering of the three boards on Thursday night.
“Our unemployment is going to grow. The federal number is in the 15-to-20 percent area. I don’t know if Ridgefield is going to get there,” he said.
“As we move forward developing a budget for 2020-21, I have heard overwhelmingly we need to keep our eye on the mill rate increase, to be sure we can deliver a mill rate increase that is the best we can do for the people of Ridgefield,” Marconi said.
Rainy day comes
Finance Board chairman Dave Ulmer shared with the meeting some thoughts about tapping into the town’s roughly $15 million surplus fund balance — an accumulation retained from past annual surpluses that functions as the town’s “rainy day fund” — to help get through the difficulties.
“I think you’ll see unprecedented use of the rainy day fund,” Ulmer said. “This is what it’s for. If you don’t use it now, when would you ever use it?”
However, the $15 million fund balance represents only about a tenth of the annual town and school budget, which is running about $148 million this year and had been projected to be in the vicinity of $152 million next year.
“It is a rainy day fund, but it is not flood insurance,” Ulmer said. “It’s not meant to cover catastrophes. It’s not sufficient to cover catastrophes.”
For the current 2019-20 fiscal year, which ends June 30, Controller Kevin Redmond projected that town revenues will be short of what was budgeted by about $1 million, and town expenses less than expected by about $400,000, leaving a projected town-side deficit of about $600,000.
School business manager Dawn Norton gave the meetings a tentative overview of the schools’ financial situation, noting that a full financial report was due to be presented to the Board of Education at its planned Zoom meeting Monday night.
Assuming schools are closed through the end of the year in June — a big assumption, admitttedly — the Board of Education could see as much as $800,000 in savings onvarious expenses, including substitutes and energy. There are some added COVID-19 related costs that total about $200,000, including the purchase of additional ChromeBook computers for the distance learning effort, more money spent on cleaning school buildings, and additional legal fees as the schools seek to renegotiate some contracts — including with the bus company.
The savings minus the added costs project to a potential $600,000 year-end balance for the school system this year, roughly balancing town departments’ $600,000 deficit.
“Based on all of that I concluded we would likely be whole for our FY 20 budget, and not have to cover any deficits with fund balance,” Ulmer said in an email the next day.
“So our fund balance will be ‘whole’ at $15.1 million available, which is 10.22% of FY 20 budget,” Ulmer said. “...that is good news and gives us a cushion for use in FY 21.”
Ulmer told the tri-board meeting that the town and schools could use up to about $3 million of the fund balance during the coronavirus emergency, and still stay within the finance board’s guideline of keeping the fund balance between 8-to-9 percent of the annual town and school budget.
Many potential budget wildcards were discussed, including the likelihood that the tax collections will run considerably below the 98.7 percent the finance board has budgeted for in most recent years.
“We have not taken any actions as a Board of Finance on anything yet,” Ulmer told the three boards. “We’ll do that in all of our meetings, based on the public hearing and discussion at our meetings.”
Selectwoman Muareen Kozlak warned that the fund balance or rainy day fund couldn’t be counted on to solve all the town’ fiscal problems.
“If there’s a shortfall, we’ll be borrowing,” she said.
“There’s just a finite amount we have in the rainy day fund,” Kozlark said. “We need to keep that in mind.”
“We’ve not only lost a lot of jobs, people have lost their businesses — there’s a lot of pain and suffering going on,” said Selectman Bob Hebert.
“Our decisions have to be data-driven. It can’t be based on emotions.”
There were four teachers and five parents among the nine speakers who expressed concern the school budget may be cut too much — and in ways that would be detrimental to “the classroom.”
And one of the 10 speakers from the public advocated budget reductions necessary to achieve no tax increase.
But support for the schools was the dominant sentiment.
“Investing in our education and investing our students right now is going to be exactly what our community needs and our society needs,” Shelley Terry told the meeting.
She supported approving the Board of Education’s original budget request for a 3.96% spending increase.
“I’m a Ridgefield taxpayer and a Ridgefield parent,” said Jessica Carter. “Leave the Board of Education budget as requested by the Board of Education.
“The schools really are our town’s biggest selling point,” she said. “We’re a pretty town but it’s really the schools that make people want to move here.”
She cautioned against basing cuts to Ridgefield schools on what other Fairfield County towns may be doing.
“Our spending per student is much lower,” she said, “...they may have more leeway.”
Veteran teacher Michael McNamara urged the boards not to enact the talked-of “zero percent increase” in the school budget.
“That would just be devastating for our schools,” he said.
He recalled the last time school budgets were aggressively cut.
“Moral was terrible,” he said. “We had high turnover...
“Keep all cuts, if possible, away from the classroom,” he said.
“Do what you need to do in terms of taxes,” McNamara said. “…I’m willing to pay the taxes. I know a lot of other people would be as well.”
Ed Tyrrell was the one speaker to back more aggressive cuts.
“I ask the Board of Finance and the Board of Selectmen to do everything possible to have a zero tax increase this year,” Tyrrell said. “We are in a national emergency.
“If this means increases in the range of 1.5% or lower for the Town and Board of Education budgets, then that is what must be done.
“The percent increases for the town budget and the Board of Education budget should be the same,” he added. “There is no logic for giving the Board of Education a larger increase. The town’s population remains steady while school enrollment has now decreased for six years in a row and is projected to decrease every year through at least 2030.”
With the five member Board of Selectmen, five member Board of Finance and nine member Board of Education, the meeting had 19 “panelists” as well as 211 people who registered to listen in or observe it on Zoom, and 131 “active listeners,” according to town Information Technology Director Andrew Neblett, who hosted the meeting on his computer.
“We don’t know what our students are going to need come fall,” said school board member Jonathan Steckler. “We have a rainy day fund. We can’t use it all. The Board of Education has to work in partnership with other boards.”
But he felt town officials shouldn’t be afraid to use some of the fund balance to carry the schools through a tough time.
“We don’t want to make a rainy day into a flood,” Steckler said.
New Superintendent of Schools Susie Da Silva was cautiously optimistic about the success of distance learning during the shutdown, and the challenges and adjustments that the system will face when it eventually attempts to return to a pre-coronavirus normal in which students are healthy, on sound emotional footing, growing and learning.
“There’s the emotional aspect and the academic aspect,” Da Silva said.
“How well is e-learning going? It’s evolving,” she said.
“We’ve asked children to be quite independent. Some children have been able to do that successfully. Others have not been able to do that successfully.”
Da Silva said educators and town budget authorities had to think about “children with executive function challenges” that make academics more difficult.
“This situation isn’t great for them,” she said.
And differences between students’ various household situations may be even more of a factor in academic progress when everyone is working from home. It’s something educators have to consider.
“Is there equity across every home? No,” Da Silva said. “That’s why grading has been as complicated as it’s been.”
When they eventually re-open, the schools will face the challenge of re-establishing normal — in both academic learning and emotional support.
“My goal for our children coming back to school is that we can create environments that are supportive and wrap our arms around them,” Da Silva said. ”...And get them back to where they were on March 13.”
“We do have to operate in an environment that is both factual and emotional,” said school board member Liz Floegel.
Ridgefield has “families in our school district who may have lost jobs,” she said, and some “who may not be able to afford groceries.”
School board member Kathleen Holz urged colleagues to be supportive and positive.
“I just think we need to have flexibility, trust the educators, understand that there are going to be needs we don’t know. But these children are our future. I put my hope in them and I put my hope in our educators.”
Selectman Sean Connelly raised the issue of the town and schools “capital” budget — major equipment purchases and construction projects which are generally paid for with borrowing, so their impact on the tax rate is spread out over a number of years.
Before the virus shutdown, the school board and selectmen had put forward a list of $7 million in projects and purchases for the finance board to consider for the capital budget. Some of these might now be delayed.
“We can say it’s a very tough time, we need to push some of those things out,” Connelly said.
But there’s also an alternative way of looking at it.
“Rates are low. This is actually a good time to go forward for things we know we’re going to need to do,” he said.
It could be viewed as a good time to borrow.
“Rates are good,” Controller Kevin Redmond said. “...And our debt service continues to come down. So there is opportunity there.”
The town’s debt service runs about $11 million a year, and has slowly been coming down as the town pays off the $90 million “school bundle” borrowing launched in the early 2000s. The decline is steady, but slowed by the addition each year of some new borrowing for projects and purchases that the schools and town departments decide they need — repairs, trucks, computer equipment.
The 2020-21 list of some $7.2 million in capital requests is more than the town has been approving in most recent years. Of that, about $2.5 million is for the schools. And $1.67 million is targeted for road repaving — specifically, the less-used roads that could be expected to have useful life of 15 to 20 years, once repaved, Marconi said. The town’s operating budget also allocates about $1.8 million — the usual amount in recent years — for work on roads that have a shorter useful life when repaved.
And budet procedures will be different, with Governor Ned Lamont’s executive order giving the Board of Selectmen — rather than voters at the annual town meeting and referendum — ultimate budget authority.
“Normally in our process, capital items under $100,000 are voted at Annual Town Meeting,” Marconi said. “Since that meeting will not be taking place we, the Board of Selectmen, will be passing the items in the capital budget on to the Board of Finance for approval.”
Selectwoman Maureen Kozlark thought both operating and capital budget decisions should be re-evaluated.
“At our board, we haven’t vetted this since the pandemic started,” Kozlak said.
Marconi said he would set up some selectmen’s meetings to do that.
Saturday morning Marconi said Board of Selectmen meetings had been scheduled for the evening of Wednesday April 29 and Thursday April 30, and budget matters could also be discussed at the selectmen’s regularly scheduled meeting May 6.
“Hopefully, we’ll get a budget that will be passed,” he said, “and we’ll move forward.”