LETTER: Town Council's Lack of In-Depth School Budget Talks is Alarming

To the editor:

During North Kingstown’s FY17 school budget debates, Superintendent of Schools Dr. Auger, bemoaned the fact that a $500,000 reduction to his proposed FY17 budget would have a “devastating” impact on our educational system.

I submit the manner and lack of thoroughness in which our elected officials responded to Dr. Auger’s statement of alarm should be prudently examined prior to our next election. Each voter should opine, if an elected official, how would I have responded to such a threatening warning. Carefully weigh all the facts, form your own opinion regarding the pros and cons of the budget reduction issue, and with this in mind, ask did our elected officials adequately identify, justify and enlighten our community as to their rationale and vote on this potentially “devastating” matter.

The community desperately needs elected officials who possess the courage to ask the right questions and demand timely and thoughtful answers. They should not be afraid to ask, demand the relevant facts necessary to make an informed decision, not blindly follow the Pied Piper over the cliff as so many, including our local teacher’s union, have done concerning the passage of school budget. I offer the following data and comments for your consideration.

The Council in my opinion had a wealth of justifiable rationale to reduce the FY17 school operating budget to $61,710,465 and set aside $500,000 in its own “controlled” School Capital Reserve Fund. Also, I submit there will not be a devastating impact on our educational system, especially given the relevant fact that school department is projecting a FY16 and FY17 school fund balance of $2.4m and $1.8m respectively, after ending FY15 with a gross fund balance over $4.1m

The process to obtain monies from the councils “set aside” SCRF was wisely established over 20 years ago and is rather simple; the school committee submits its capital project requests to the Town’s Asset Management Commission for vetting, upon which the Council votes to approve or disapprove the project’s funding. (Unfortunately and inexplicably, the Asset Management Commission was bypassed in the approval process for several unnecessary and costly school capital projects investments, including a $500,000 office space lease, $1.5 million for improvements to Davisville Elementary school and a $1M expenditure to “fix” a so-called classroom overheating problem at the high school which was basically a failure - asked the students.)

I am concerned that Council members McKay(R), Houston(R), and Albuquerque(R) did not possess the insight to offer a more complete and factual explanation to the community regarding their underlying rationale to reduce the school’s operating budget. I’m equally perplexed and disappointed by Council members Maloney (I) and Waxman’s (D) decision, absent any rationale or fiscal understanding of the school operating budget, to vote against the $500,000 reduction. The council’s inability or unwillingness to focus and hold in-depth discussions on school financing issues suggests to me that the overall budget process is terminally ill, lacks fiscal credibility, oversight, accountability and transparency which prompts the question why haven’t our elected officials exercised their fiduciary responsibilities on behalf of our taxpayers.

The latest available audit data (F/Y15) interestingly reveals that the school department under spent their $59,055,083 appropriated budget by $1,550,269. Incredulously as it may seem, the audit also reveals that school committee inexplicably transferred a total of $3,206,642 from its FY15 operating fund which contributed to an end of year operating deficit of $1,553,654. To balance the FY15 books and complete the shell game, the school committee apparently approved a transferred of $1,553,654 from its school fund reserve account, leaving in reserve a paltry $2,240,700 to begin the FY16 school year.

Each school parent and taxpayer should demand to know how the superintendent’s self-inflicted $1.5M budget reductions impacted their children’s FY15 educational programs (perhaps larger class sizes or the absence of student supplies which seems to coincidentally arise during the annual budget process).
The FY 15 audit tells us that $4,219,643 was transferred into a heretofore rather covertly established school special revenue account (not fund) titled “Capital Improvement Project”. The source of this funding included the transfer of $1,021,035 from the council’s municipal capital project and school capital reserve fund accounts. The remaining $3,198,608 came directly from the FY 15 school budget appropriation.

An accounting of the $4,219,643, reveals that even after spending $3,133,790 on school Capital Improvement Projects, which were not vetted by the Asset Management Commission, the school department ended FY15 with an overall fund balance surplus of $4.1, including $1.9M and $2.2M ducked away in their CIP and the school fund reserve accounts, respectively. This school surplus begs the question what justifiable rationale did the Council have when it decided to transferred $1M from its capital reserve fund to the school department, when there was a much greater need to implement town wide road repairs/maintenance projects.

While the school committee may be the culprit of bad practices, poor decision-making, the lack of transparency and fiscal irresponsibility, it is ultimately the obligation of the Town Council to ensure that the taxpayers money is spent as appropriated, wisely and efficiently. Those who proffer the notion or hypothesis that the Council has no or just limited oversight responsibility of school department expenditures, in my opinion, are uninformed, have been misguided or have never read our town charter which places the expenditure and accountability of all taxpayer’s money in the hands of our Town Council.

Again, I call on the Town Council to undertake a school budget to expenditure reconciliation consistent with the annual town audit. Perhaps, the answers to such questions as to why the school supply and materials budget was underspent by some $1.5M between FY10 and FY15, the salaries and fringe benefits account by $2.7M, and the professional services account by $1.5M.

Finally, to ensure clarity, I will add that our FY15 financial issues have not been a one-time aberration and I encourage community members to demand that those who are seeking elective office to support greater financial oversight and accountability, such as the establishment of sorely needed town finance committee.

Bill Mudge
Former, NK School Committee member