Board approves new reserve funds ‘to even out the bumps’

The Enterprise — Sean Mulkerrin

The “augmented reality sandbox” is a learning tool built by students. Shifting the sand around redraws the contour lines. The box allows students a hands-on approach in learning topographic concepts, letting students to see the contoured lines in two dimensions, on a computer screen, and in three dimensions in the sandbox.

VOORHEESVILLE — At its monthly meeting on Monday, Nov. 13, the Voorheesville Board of Education approved new reserve funds that are meant to smooth out the budget process, according to Superintendent Brian Hunt.

“The purposes of reserves [funds] are to meet unanticipated expenses,” said Hunt.

The board’s approval means the creation of new reserve funds for the employee retirement system, repairs, and tax challenges.

The employee retirement system includes all non-instructional staff such as custodians, food-service workers, and bus drivers.

The recent history of yearly contributions has varied from $200,000 to $600,000, Hunt said.

“There are enough variations, that if there’s a reserve for this — the idea is to even out the bumps … If we get to a year where the ERS payment goes up $100,000, well, we have a reserve. We won’t have to cut programs, and we won’t have to raise taxes,” said Hunt. “It will make the budget easier to build, and more palatable.”

The creation of a tax certiori (appeal) reserve stems from the problems the town of Guilderland is having with its assessments and drop in the state-set equalization rate, which led to an increase in school taxes for Guilderland residents in the Voorheesville School District.  

This reserve is being set up in anticipation that some Guilderland residents may challenge their town-provided assessments. That means residents can make a certiori claim to the school district for previous years’ assessments that are found to be in error, Hunt told The Enterprise. This would lead to a reduction in district revenues.

The current repair reserve “has been topped-off to its maximum level,” Hunt said. Creating the need for a second fund.

Currently, there is a little over $104,000 in the repair-reserve fund, according to a letter from Francis Rielly, the assistant superintendent for finance and operations, to Hunt and the board. “Just in the last school year the district has used over $214,000 from the existing reserve,” the letter states.

“I believe the creation of these reserves allows the district to have money set aside to fix the unexpected,” the letter says.

Hunt highlighted the need to have reserves, in particular, reserves for capital projects: “Any costs that are not paid for by reserves must be borrowed through bond issues and paid back over the years, with interest,” he said.

“Less reserves to fund the local share [of the project] leads to greater borrowing and increased capital costs — and those hit your budget every year,” Hunt said.

“If we were to borrow the entire $3.2 million,” he said of the projected local cost of a capital project, “that would be a substantial hit to our budget for the next 15 years,” he said. Hunt then illustrated his point, using a capital project from 2001.

The 2001 capital project built the middle school, the performing arts center, the high school gym, the new pool, and the purchase of the satellite athletic fields for a total project cost of $17.3 million of which $16,506,000 had to be bonded, with an additional bonding of $224,000 to purchase the land for the fields. Only $600,000 in reserves was applied to the project.

The cost to service the district’s debt (the amount of money used to pay back loans) accounted for 6 percent of the total budget in 2000-01.

By the following year, 2001-02, servicing the debt accounted for 14 percent of the district’s budget.

In one four-year period, 2002 to 2006, there was a cumulative increase in the tax levy of 34 percent.

It took until 2016-17 for debt service as a percentage of total budget to return to a pre-2001 level.

“If we have enough reserves, we can do this affordably — and actually, I believe, in the end … We will have a lower, net capital cost in five years, than we do now,” Hunt said.

Hunt then recommended that the board begin to think about creating a new capital-reserve fund for longer-term needs.

“Our enrollment is growing, and the housing developments make it pretty likely that it will grow further,” said Hunt. “If that’s the case, we have to look at the capacity of our buildings, particularly the elementary school … If we want to do something bigger, potentially another elementary school … We would need a substantial capital reserve.”

Coach Baron

In response to community concerns about girls’ basketball coach, Robert Baron, The Enterprise left many phone messages for Baron and for Voorheesville athletic director, Joseph Sapienza but received no response.

“Right now, we’re investigating a situation,” Hunt told The Enterprise on Nov. 13. “That’s all I can tell you. But no action has been taken — no formal action.”

Other business

In other business, the board of education:

— Approved $5,500 for plumbing repairs to the boiler for the middle school and high school;

— Approved the elimination of a half-day of school on March 9. It will now be a full day; and

— Approved the board’s membership in the New York State School Boards Association, with annual dues of $8,081.

 

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