TICONDEROGA - The federal economic stimulus program helped many schools avoid difficult decisions last year. That's about to end.
State Comptroller Thomas DiNapoli has issued a report noting New York schools face a shortfall of more than $2 billion when the stimulus money runs out.
He said districts statewide will see the gap in the 2011-12 fiscal year unless the difference is made up by the federal government, the state, or local property taxpayers.
The analysis shows that could mean an average property tax increase of nearly 8 percent just to make up for the loss of federal money on top of annual increases in school spending.
The temporary stimulus money was allocated to help states suffering deep drops in revenue because of the recession, but the funding runs out in 2011-12.
The Ticonderoga Central School District will not have any stimulus hangover, Superintendent John McDonald said.
"We knew these were temporary funds and therefore only used them to fund temporary things," he said. "We have one position we filled with these funds, but were clear that it would only exist as long as the funds were available."
The current Ticonderoga budget includes $749,628 in federal stimulus money - 4.4 percent of the total $17.1 million budget.
The loss of federal stimulus money won't affect Schroon Lake Central School, Superintendent Mike Bonnewell said.
"Much of the stimulus money - $1.6 billion of this year's $2.8 billion - was to restore state aid cuts, aid that is to be paid to schools by state formula," Bonnewell said. "If the state returns to the old formula when the federal money supply ends, schools should not be in tough shape. Especially if, as everyone suggested, schools used the remaining $1.2 billion for non-recurring improvement expenses.
"At Schroon, for example, we used the state aid restoration for staff positions," he continued. "The other stimulus money has gone mostly to non-recurring expenses. We replaced a 40-plus year old oven with a special food service grant. We have scheduled some staff development activity. We have developed a pre-school parents education program. All things that we will have to use for years to come, but won't need to spend on each year."
The current Schroon Lake budget includes $134,672 in federal stimulus money - 1.8 percent of the total $7.3 million budget.
"At Crown Point we were keenly aware that the stimulus money had a timeframe associated with its end," Superintendent Shari Brannock said. "In doing so, we made unfortunate but necessary changes in our spending plans. We used almost all of the funds to save jobs and to help offset higher paying positions, some of which may through attrition or rehiring at a lower rate help our budget stay reasonable. CPCS did not create new positions as the stimulus finds also allowed, knowing that that burden could not be passed along to our taxpayers when the money ran out."
Crown Point Central School has $284,288 of federal money in its current budget, 4.5 percent of its $6.2 million budget.
Moriah Central School has $900,210 in federal stimulus money in its budget, 6.5 percent of its $13.9 million budget.
Schools also face the uncertainly of New York State's budget woes. Facing a deficit, state lawmakers may be forced to cut state aid to schools next year. Gov. David Paterson is already withholding 2009-10 aid to schools, a move that is being challenged in court.
"In terms of the budget, schools should have been planning ahead for this," Ti's McDonald said. "We have good fund balance and are keeping a close eye on spending."
Ti administrators began work on the 2010-2011 budget last November, the superintendent said.
Moriah Superintendent Bill Larrow is bracing for the worst.
"Yes, things are as bleak as they appear," he said. "Just recently, the governor held 10 percent of our December state aid payments and another 19 percent in STAR payments. For many schools, including Moriah, fund balances will have to be tapped to help get by. We thought this was coming so we froze our budget months ago, hoping that this would help off set the state aid reduction.
"To help prepare for future budgets, I believe all schools will continue to budget only the bare minimums," Larrow said. "I also believe that you will continue to see staff reductions through attrition or in worst case scenarios layoffs. By doing this districts will offer only the core courses required to graduate and will have to be much more creative on how they utilize current staff. "
Brannock is also concerned about the future.
"I wish I could predict how bad it is going to get to live in and educate children in New York State," she said.
"I am sure you also recall the sacrifice a majority of our staff members made by not taking salary increases for 09-10 that will also help us keep our expenditures down as they were frozen at last years numbers," Brannock said. "The one thing we all have to keep in mind is that we need to provide a quality education for our future students and it takes teachers and programs to do so."
McDonald hopes the bleak economy will have a silver lining.
"Maybe the financial situation will provide the catalyst for mandate relief, the biggest frustration in the budgeting process," he said.