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Inflation impacts school budget for ‘23-‘24

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By Melanie Lekocevic

Capital Region Independent Media

With the 2023-24 school budget currently in the works, inflation is expected to impact the district’s bottom line this budget season. File photo

GREENVILLE — High inflation is expected to lead to a rise in the coming school district budget and the cost of supplies, fuel and electricity for the 2023-24 school year.

Business Official Janet Maassmann from the Greenville Central School District went over the rollover budget for the coming 2023-24 school year at the January meeting of the board of education. The budgeting process is expected to run through April, when a tentative budget is expected to be adopted before voters make the final decision in May.

The rollover budget is the first step in the process.

“We start with the rollover budget, where we put together a draft based on the assumption that all programming and staffing levels will stay exactly as they currently are,” Maassmann explained. “Then we look at the previous budget and increase the expenditures that we know increase every year.”

Line items that are expected to change from year to year include salaries based on employment contracts, increases to BOCES contractual costs, health insurance, retirement rates and general insurance expenses.

“We use the actual costs when we can, or make projections based on past history,” Maassmann said. “For the purpose of this rollover budget, we have increased the BOCES cost by an estimated 3%. Projected salaries are based on actual employee contracts. For employee benefits, we know that Social Security and Medicare have not changed — it is 7.65% of the gross wages.”

Health insurance costs are expected to have a major impact on the tax levy this coming school year.

“Health insurance costs would be estimated to increase by 10%,” she said. “This will be revised to actual costs when we know them around February or March. In February, they will give us a better percentage and then in March they’ll give us our actuals.”

Debt service payments are one area that could actually go down because a bond was paid off, but that too may change depending on whether the board opts to purchase two new vans for the district, which is currently under consideration.

For revenue, it is not yet known what state aid will be — that figure will be dependent on the state budget that will be adopted in the spring, with an April 1 deadline.

“At that point, we will make the necessary changes to our projections,” Maassmann said.

While the numbers are still be worked out, taxpayers can expect to see an increase in the 2023-24 school year compared to the current school year.

The present 2022-23 school budget saw an increase of 2.47%, or $811,275, compared to the previous year, with a tax levy increase of 2.25%, or $390,577.

Currently, the rollover budget includes an increase higher than that.

“The rollover budget reflects an increase of $1,075,326, or a 3.19% increase from this school year,” Maassmann said. “Most of that is from health insurance, with the estimate of 10% for health insurance.”

Board of education members Jay Goodman and Eric Herbstritt asked about the rise in projected health insurance costs.

“I would like to know what the difference is in terms of the health insurance between last budget and this budget,” Herbstritt said. “I know we’re projecting a 10% increase, but what was it the year before?”

Maassman responded that the previous year saw a 5% increase in health insurance costs.

Herbstritt asked what other costs are expected to go up due to rising inflation nationwide.

“Everything. Supplies, fuel oil, textbooks — everything,” Maassmann said. “Electricity. Everything is going up.”

The district is also waiting on the allowed tax cap according to the state calculation, which should be determined by the state in March.

Two of the three major components of the school budget are expected to see an increase, Maassmann said. The administrative component is expected to see a 4.6% increase under the rollover budget, and the program component would have a 5.8% increase. Only the capital component is expected to see a decline, of 6.17%.

“Most of the decrease you will see is in the debt service,” Maassmann explained. “We had one bond that got paid off and also the interfund transfer to capital.”

The next budget discussion will take place at the board of education’s Feb. 27 meeting, board President Tracy Young said.

“We have Feb. 27, which is when we’re going to be doing the program component,” Young said. “We have March 6, when we will be discussing the capital component, administration and revenue, and we have April 17, when we would have budget discussion No. 4, and tentatively adopt a budget at that point.”

The board is then scheduled to hold the annual budget hearing on May 2, and voters will determine the fate of the budget when they head to the polls May 16.

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