RSU unveils adjusted budget as printed by SeaCoast Online.com

RSU unveils adjusted budget & Sets district budget meeting for Tuesday, June 7

 

Kelly Hearn photo Members of the RSU 21 Board of Directors listen to residents speak about the proposed budet on May 27. The initial budget vote failed, so the board discussed further changes.

By KELLY HEARN

yccs@seacoastonline.com

June 02, 2011 2:00 AM

KENNEBUNK — A newly-proposed RSU 21 district budget that decreases the local tax burden by approximately $768,000 will be put before voters during a June 14 referendum.

The amended $35.7 million budget was passed by a 6-5 vote during a contentious RSU 21 Board of Directors meeting Friday, May 27, at the Kennebunk Elementary School.

District voters rejected the proposed budget May 24, along with the Thornton Academy Middle School contract buy-out and a new cost sharing agreement. Only the budget — which lost by a slim 51 percent to 49 percent margin — is being put back before voters.

The new proposal's revised impact on taxpayers: Arundel would see a 4.54 per cent increase or $59.87 per $100,000 of assessed value, and Kennebunk a 1.15 percent increase, or $16.45 per $100,000. Kennebunkport would see a decrease of 1.33 percent, for a drop of $8.41 per $100,000.

The board made two adjustments at the May 27 meeting. First, it reduced health benefits by $100,000, a move made possible when the district's health insurance provider lowered its projected rate of increase from 10 percent — the figure used to calibrate the original budget — to 6.5 percent. The change will not eliminate any staff or programs.

The board also wants to apply $1 million from the district's undesignated fund balance to next year's budget — a stop-gap measure that reduces by $668,347 the amount raised by local taxes but pulls down the undesignated cash reserve to what some say is an unacceptably low level.

Originally, only $339,900 would have been applied to next year's budget, saving $1.2 million in the fund for the TAMS buy-out.

Finance Committee chairman Kevin Knight told the board that the new figure was chosen because it leaves $500,000 in the undesignated reserves.

"And we felt $500,000 is a reasonable number," he said.

RSU 21 Superintendent Andrew Dolloff warned that reducing the undesignated fund will cause "a significant challenge to next year's budget process."

Director Jack Reetz said the board should retain somewhere in the range of 3 percent of its budget in the fund, a figure recommended by the state of Maine, to deal with probable restrictions in state and federal funding in the year to come.

"Taking a one-time pain relief pill for this year is not prudent or financially responsible," he said. "We need to look longer term."

The meeting took a confrontational turn after Director Dan Pleva indicated that using undesignated funds was preferable to asking taxpayers to pay more. He then questioned whether the board had taken a hard enough look at staffing issues in the context of falling enrollment.

"Those are kind of hard choices we have to spend time looking at," he said. "I don't believe we did those things."

Chairman Norm Archer asked Pleva if he was suggesting that the board had simply "been whistling Dixie until the election."

Director Matt Fadiman said hundreds of hours had gone to long-term planning.

Fadiman then said he "didn't know if drawing down the positive fund to only $500,000 is responsible," saying, in addition, that the undesignated positive fund balance "is not just a piggy back that we can draw from when we need to."

Director Ed Geoghan called for using the $1.2 million that would have gone to Thornton Academy to offset current tax demands. He read from a 2010 audit stating that the district is in good financial health with an "unrestricted" fund balance of over $5 million.

Several board members protested, saying that an unrestricted fund is simply a snapshot way to say how much money is in the bank at a give time — money that gets used to pay salaries, for example. Undesignated funds accrue over time and are used to mitigate unforeseen cash flow problems.

"You're just taking numbers out of context to make it sound like we have deep pockets that we don't have," Knight told Geoghan.

Director Bob Domine then took aim at Pleva, while ignoring calls to order.

"It's very frustrating to have you sit here, Dan, and ask questions as though you've never ever been here," Domine said.

Domine then told Geoghan he was giving him a free accounting lesson, and proceeded to explain the nuances of fund accounting.

"Frankly if we can't get this board to understand this stuff and if we can't communicate it to the electorate, then our votes mean frankly nothing," he said.

Domine continued, "If anybody here thinks the budget or TAMS vote was a referendum by the entire community then you've got rocks in your head. This vote was about politically who was better at mobilizing a group of people to come and to vote at the polls."

He said the TAMS issue should be put back to the voters and community members with school-age children rallied to support it "rather than a slice of the community that frankly has nothing better to do."

Pleva at one point suggested the board had a communication problem.

"The fact that the townspeople of Arundel in part were not listened to by the board did drive them to vote the way they voted," he said.

Director Leia Lowery said the board had bent over backwards to be transparent and to invite public participation.

"We have to budget sensibly and sometimes that means putting in some padding so that we protect the very students that we are supposed to be representing on this board," she said.

Diane Robbins, a candidate for an RSU seat, spoke up from the audience saying that the board's actions have been irresponsible, and that many area residents don't have the money to shoulder increased taxes.

There will be a budget validation meeting at 7 p.m. Tuesday, June 7, at Kennebunk High School.