BOF Reduces BOE Proposed Budget by $688,000, Leaves BOS Untouched; BOE Chair “Disappointed & Frustrated”

The Board of Finance (BOF) met Monday evening, April 4 to deliberate on a proposed FY 2023 budget to bring to the Annual Town Meeting on Tuesday, May 3. The BOF members’ objectives for the evening were to consider the budgets that had been presented to them by the Board of Education (BOE) for the school and Board of Selectmen (BOS) for the town, and determine what Wilton residents want the budgets to cover and what they would be willing to pay in taxes to fund those budget requests.

During the meeting, the BOF members discussed whether decreases could and should be made in both proposed budgets. Four of the members said they believed the majority of residents did not want a 1.94% mill rate increase, as projected with the current budget requests.

None of the members thought cuts could be made to the BOS budget request (and in fact, one member suggested it was too low). And while BOF members Sandy Arkell and Chris Stroup said they did not want to make any cuts at all to the proposed BOE budget, the other four members supported looking at where the BOE budget request could be reduced. They soon zeroed in on whether or not they could move proposed operating capital expenses (facility upgrades and maintenance) on the BOE side to the capital bonding column.

The ensuing conversation ping-ponged back and forth, with members disagreeing about whether the items could be considered bondable (more on that below). There were also some moments of frustration as members disagreed with one another about even directly suggesting that the reduction be made in that way, since Wilton’s charter prohibits the BOF from making any specific line-item reductions to the BOE budget.

Eventually, the BOF voted 4-2 to reduce the BOE budget request by $688,000^*. That change, according to calculations, would put the year-to-year overall budget increase at 1.67% (down from the original^* proposal of 2.37%). The FY’23 mill rate increase, originally proposed at 1.94%, would now stand at 1.2%.

^[*In February, Superintendent Kevin Smith presented his budget request to the BOE with a proposed year-over-year increase of 3.26%. However, on the day of the public hearing on the school budget (Mar. 23), Smith announced the district could lower that proposal by bonding $205,000 of the proposed operating capital expenses. That change would drop the projected BOE increase to 3.02%. Factoring in that change with the cut made Monday evening by the BOF would mean an overall $893,202 reduction to the BOE budget request.]

Here’s how that breaks down in dollars, and what the BOF will present to voters in May:

• BOE Proposed Budget: $86,677,862 ($1,873,647 or 2.21% YOY increase)
• BOS Proposed Budget: $33,943,364 ($457,878 or 1.37% YOY increase)
• Total Proposed Budget (including bonding requests and reserves): $130,942,900 ($2,154,038 or 1.67% YOY increase)
• Proposed Mill Rate: 28.2031 (.3346 or 1.201% YOY increase)

Discussion Part I:  What Do Voters Want

Before deliberations began in earnest, BOF members reviewed the results of the survey they conducted on March 21-31 to gain perspective on what residents supported (or didn’t support) in the budgets and what would be acceptable tax increases. BOF member Matt Raimondi, who was the lead person on the survey, provided an overview of the results.

• 554 people responded to the survey
• Respondents considered the original^* 3.26% BOE budget increase request, not the subsequently reduced 3.02% increase discussed at the Mar. 23 public hearing.
• 71% of respondents approved of the proposed BOS budget (+1.37% increase) and 58% approved of the proposed BOE budget (+3.26%^* increase). However, 53% did not approve of the mill rate increase (+1.94% increase)
• While the majority of respondents approve of both the BOS (71%) and BOE (58%) budgets, a majority (53%) opposed of the proposed mill rate increase.

Raimondi said the biggest factor was whether or not the respondents had children attending Wilton Public Schools:

• Generally, respondents with children attending Wilton Public Schools voted in favor of the BOS budget (74%), BOE budget (71%), and mill rate (57%).
• Respondents that do not have children attending WPS responded in favor of the BOS budget (74%), but responded against the BOE budget (61% against) and the mill rate (67% against).

Another point Raimondi highlighted was a follow-up question that asked if respondents what maximum mill rate increase they would support.

• 51% of respondents would prefer a mill rate increase of 1% or less, with the weighted average increase calculated at 0.83%

BOF Members’ Opinions

BOF Chair Michael Kaelin then asked each member to articulate their viewpoint on what should be done.

• Stewart Koenigsberg

Koenigsberg began by reiterating his support for Wilton schools, despite advocating to reduce the BOE budget requested increase; he explained why.

“We all respect and admire what they do for the town and for our students. People can disagree about numbers, but I don’t think any of us disagree that many people do come to this town for the schools. The schools are central to many of the values we have, both personal and property values. We have been one of the top-rated schools thanks to the efforts of the people who work at the schools and the superintendent and the investments made by the people in this town,” he said, before adding, “[But] there are different views on how much people in the town can afford or wish to afford.”

He later added, “People feel significant financial burden.”

Anticipating rising inflation and property values, coupled with something Koenigsberg historically points to — declining school enrollment contrasted with rising staff counts and per-pupil costs — he reiterated that the Wilton Public School budget should reflect those factors accordingly.

Koenigsberg said he supported contractual pay increases for student-facing teachers, but he questioned spending for teacher coaches — something he said reflects feedback he’s heard from residents.

And while he did not favor reducing the BOE budget as much as some survey respondents had expressed, he believed a compromise was in order.

“We have great, great schools. I think we’ll continue to have great schools. What I’m requesting here is just to align ourselves with what the town is looking for in terms of the cost they’re willing to spend. And again, that’s not a disrespect to the Board of Education, the teachers, I think they do a fine job and, you know I really respect and admire everything they’ve done and continue to do,” he said, adding, “I hope we can find a way to bring the budget down in line with that.”

Stroup and Arkell were the next two BOF members to speak, and they did so briefly and to the point in their support of the budget requests as presented.

• Chris Stroup

Stroup explained what impacted his decision to support both BOE and BOS budgets as presented.

“I’ve considered the Board of Finance’s responsibilities as enumerated by the Town Charter, the comprehensive processes followed by both boards and the offices of the first selectwoman and the superintendent of schools, and the important fact that both budgets were approved unanimously. I considered the feedback we received in many emails to the BOF, responses to the BOF survey, and the feedback we received at, public hearings. So I would recommend that we accept the budget as proposed.”

Stroup made an argument that the BOF should respect the decisions made by the two other boards — that they were representing the residents’ wishes as well when they set their budget requests.

“They’re responsive to the town as well. And they collectively, who better understand their budgets than we do, almost by definition, decided it was a good idea to spend the money that they have presented… I don’t think that we’re in a position to, based on the time and effort that we’ve invested, easily override and use our judgment in place of the two boards,” he said, adding a comment to address BOF members who opined about whether teacher coaches were necessary expenditures. “I don’t think we should make any comments about pedagogy. I think we should stay far from that — we don’t have any expertise on this board about the best way to educate our kids.”

• Sandra Arkell

Arkell said she echoed Stroup’s points. “I also want to thank the BOE for all of your feedback and especially appreciate your comments on March 23 in the hearing. I think you’ve taken a very thoughtful approach and I fully support the recommendations that you’ve brought forward.”

Later in the meeting, Arkell spoke more fully in support of not only maintaining the BOS budget as proposed but also increasing it. She suggested that where costs were cut to cover small increases, now Wilton needs to invest.

“If we look back over costs that have been cut, like having a shared CFO [between town and school], is that the right model today? A lot of the information we’re talking about, is there more of a finance need? I also think we could be proactively looking at development. There’s maybe opportunities that we’re missing,” she said, adding, “You can’t talk about expenses without talking about the revenue opportunities. We have not done that.”

She suggested increasing the BOS budget to “focus on reinvestment in Wilton and generating revenue.”

“You just can’t cut your way to prosperity, and this is a game this town has been playing for a long time and we continually kick the can down the road,” something Arkell said survey respondents and voters have made clear.

“Our schools should not be the only thing going for our town. And this pressure is never going to go away. If that’s the only thing we have going for Wilton, we are always going to be under inflationary pressures and cost pressures. It’s not sustainable,” she said.

• Matt Raimondi

It was the voices of voters and survey respondents that spoke to Raimondi in what he considered.

“Based on my math, the average voter will see an average increase of 1% above what the mill rate increases. When you mirror that with the results of the survey … 1.9% [mill rate increase] was too much,” he said, acknowledging that the .83% weighted average preferred increase was too low and would be “a tough ask” on the “other [BOE] side.

Raimondi said budgets that show “a great deal of fiscal responsibility” reflect the town’s — and BOF’s — values.

“The Board of Selectmen should be especially commended for the zero-based budgeting approach and so I do support the BOS budget,” he said. However, while the BOE did reflect some fiscal responsibility, there were still “certain areas where potentially some other … a magnifying glass could be placed, to try and get that mill rate down.”

• Rich Santosky

Santosky was one of the BOF members advocating that the BOE’s entire operating capital be bonded, as a means to reduce the overall budget ask but allow “the school [to] still get the things that its asked for, just not funded through the BOE budget and the mill rate. So it’s not a one-year expense, it’s bonded over the term of the life of the thing that’s being repaired,” he said, “So elevators with a 20-year lifespan, we would pay for them over the course of 20 years. For a ceiling, we would pay for those over the course of the life. So that would bring the mill rate down.”

• Chair Michael Kaelin

Kaelin said that even though the discussion at hand was looking at reducing the proposed budget requests, he wanted to “erase the idea that anyone’s talking about cutting the schools.” That even if the BOF shrank the BOE’s request, it would still constitute an increase.

“The budget that we approved for the schools in FY’21 was over $82 million. The budget we approved last year for FY’22 was over $84 million. And now in FY’23, we’re being asked to approve a budget of more than $87 million. So we’re not talking about reducing the school budget in any way. What we’re debating is whether to increase it by $2 million (or a little less than $2 million) and $2.6 million (or almost $2.8 million),” Kaelin said.

Kaelin said he heard a clear message from voters when he ran and was elected to the BOF in 2019.

“The BOF the year before cut the school budget. I ran on a platform of protecting the school budget and protecting the schools from the BOF cutting the school budget. Frankly, one of the things that made a big impression on me was one of those BOF members in 2019, who I was running against and criticizing for cutting a school budget, he got more votes than I did. That’s actually meaningful to me,” he said, (adding a message to residents that “votes matter” and encouraging them to vote) as something similar happened in the 2021 municipal election.

He too questioned the need for spending money on teacher coaches.

“I approach every budget as, ‘Is this a need or a want? And in the town of Wilton, people don’t want ro pay for the wants, but they will pay for the needs.”

Kaelin explained his thoughts:

“I was confident about the BOE budget until this year. What shook my confidence in it was learning that we’re spending $1.4 million on instructional coaches for teachers. Now, I want the public to understand this. We’re not talking about people that are in the classroom, teaching your children, we’re talking about people coaching your children’s teachers on how to teach your children. Having said that, I’m not going to question for one minute the wisdom and efficacy of this. I’m not an educational professional. … I have complete confidence in the educational professionals, but I am a taxpayer,” he said, adding, “To me, this is a want and not a need.”

In other terms, Kaelin said Board of Finance members have to make choices and prioritize.

“In terms of needs, my judgment is we need a new police station more than we need instructional coaches in the schools.”

And while Kaelin said he was using that as an example and “not suggesting a line item cut,” he said, “what it suggests to me is that in terms of prioritizing, there’s things in the school budget that have less of a priority for me and the rest of the town than other things. So I think we need to reduce it.”

Deciding How Much to Cut — Yes; Deciding Where to Cut? Not So Fast

After hearing from all the members, it became clear that at least four members — a majority — would support some sort of reduction to the BOE budget request. Debating how much to cut was the next choice. And while several BOF members supported looking to the amount requested for operating capital expenses to decide how much to cut, the question still remained as to whether those items could be bonded.

And not everyone agreed on that.

Complicating matters, the decision on whether or not those items could be bonded wasn’t up to either the BOE or BOF — it’s would be the selectmen’s choice to make.

“I think we have to make an assumption about that. We let it go to the Board of Selectmen to determine and work with the Board of Education on the long-term capital plan,” Koenigsberg argued, adding that if the BOS opted not to support that plan, the BOF still had time to consider funding those capital expenditures separately, as they have done in past years. “I would say we should move forward with an assumption that those are bondable and capitalizable, otherwise we’re just going to go in circles.”

Kaelin disagreed, saying it would be “overstepping.”

“It’s an assumption we know we can’t make, it’s not our decision. It’s their decision as to where it comes from. And even if the BOE were to say, ‘Yes, we want to bond it,’ then they have to go to the BOS,” Kaelin said. “We’re overstepping. That’s not our responsibility, it’s not our job.”

GMW reached out to First Selectwoman Lynne Vanderslice after the BOF meeting to ask whether or not the town could bond the capital operating expenses — the maintenance needs — requested in the BOE budget. Vanderslice feared the evening’s discussions would be potentially confusing to residents and wanted to make a clarification.

Vanderslice maintained that the town is unable to bond the items which the BOF members suggested could be bonded, saying the two items individually do not qualify under a policy adopted by the BOS — a policy which she said is “good financial management and discipline. And it keeps everyone honest.”

It’s a policy she said has been in place and has been explained to the other boards, as recently as the Mar. 1 tri-board meeting.

The policy, she explained, allows only items valued at $250,000 or more and with a useful life of at least 10 years to be bonded. She gave an example of how this has been applied on the BOS side.

“The BOS historically has included the purchase of a dump truck in our operating expense. The FY 2023 BOS budget includes a $190,000 large dump truck. Without the policy and if we were a different set of people, we might have said, ‘Hey let’s bond the dump truck this year, so our numbers will look better. We can ask for a .8% increase instead of a 1.37% increase.’ Fortunately, we have the policy so that doesn’t happen.”

The $253,000 in BOE capital operating expenses that some of the BOF members suggested could be moved into the capital bonded projects budget category include two items: $203,000 for the WHS lobby elevator and $50,000 for a study to determine if there is an issue with the subflooring in an area within Middlebrook.

Vanderslice said they do not qualify under the BOS bonding policy.

And since the selectmen make the final call for what gets put in front of voters to consider for bonding, it seems the two BOE items in question won’t be on that list.

“For the same reasons we wouldn’t make a one-time exception for the dump truck, I don’t expect we will make a one-item exception for either of these [BOE] items,” she told GMW.

Reaction from BOE and BOS Leaders

Board of Education Chair Deborah Low told GMW she was “disappointed and frustrated” with the BOF deliberation outcome, noting that at a 4-2 vote, it was not supported unanimously. Like Vanderslice, she also called the discussion “confusing”.

And if the decrease can’t come from the operating capital expenses, then the BOE will have to find other places in its budget, something Low said will leave the district with “no good choices.”

“Reducing the operating budget request by $688,000 will hinder the district’s ability to move forward. The request reflected next year’s priorities of continuing to address the impacts of COVID on learning gaps, adding mental health support, continuing with math program improvement strategies, supporting special education programming, expanding Wilton High School course opportunities, and the next phase of our district technology plan. The full Board [of Education] will be meeting on Thursday, Apr. 7 to review and discuss the Superintendent’s recommendations for possible reductions. Before then, it’s not appropriate to conjecture about specific reductions but there are no good choices.”

First Selectwoman Lynne Vanderslice declined to comment on the vote to reduce the BOE budget request and leave the BOS budget as proposed.

Next Budget Steps

The Board of Finance reconvenes tonight to formalize the decisions it made Monday evening with resolutions that it will bring to the Annual Town Meeting and present to voters.

The Annual Town Meeting will be held on Tuesday, May 3 at 7 p.m. at the Clune Auditorium. The proposed budgets as set by the BOF in these deliberations will be presented to the voters. To learn what happens at the town meeting and what voters will consider and vote on, read GMW‘s coverage of how the budget works and watch our “Wilton 101” video explaining it all.

UPDATE — 4:12 pm:  Lynne Vanderslice emailed GMW following Monday evening’s meeting to “clarify” some background about discussions that have taken place this past year about potentially changing how the town and school approach operating capital expenses, “for those who might have been confused by the discussions”:

“The Board of Education broke out operating capital costs separately this year in the hopes that those monies would be transferred to the Board of Selectmen operating capital budget where they can be spent over five years. Debbie Low and Kevin Smith discussed the concept at a Board of Selectmen meeting, but an actual proposal was never finalized.

“The Board of Selectmen has a process for consideration and prioritizing bonding requests. Both those recommended by me and the town employees and those recommended by the Board of Education are presented to the Board [of Selectmen]. Typically requests are made 4 to 5 years before they are expected to be needed. Each year, the Board of Selectmen approves a 5-year bonded capital plan.

“Last year’s plan included $4.4 million in BOE bonded projects, of which $600,000 was approved last year by the voters for BOE roofs. As of today, this year’s plan includes the remaining $3.6 million from last year’s plan, plus an addition of $500,000. The 5-year plan will be discussed at the Wednesday, April 6 Board of Selectmen meeting.”

Additionally, following the meeting, BOF member Stewart Koenigsberg contacted GMW to explain why he believes bonding the disputed operating capital expenditures should be allowed. His statement is below:

“There is no law against bonding the elevator or any other long-lived renovation or improvement.

“The proposed new Police Station has an elevator in the proposal, which will be in the BOS bonding proposal. Light switches and wire are also in that proposal and are bondable. A shovel full of asphalt used to replace a road is theoretically bondable.

“The issue is that the internal guideline put in place sometime over the past few years [by the Board of Selectmen] suggests that anything under $250,000 should not be bonded (which is likely founded on the principle that small items should not go through the complicated, expensive process of bonding), yet a significant plan to maintain the integrity of town property and facilities, when evaluated as a whole — like town roads, or a significant long-lived upgrade or necessary replacement — should clearly be bondable.

“Proposed plans are currently in place to bond many items under $250,000, but they are “grouped together” to exceed $250,000, like one road or multiple roads, and all the parts that go into a major renovation or replacement.

“These types of internal policies are not unusual in big companies. Those big companies typically do not want to track the capitalization of very small items. And yet the Town of Wilton is not a large company, but still would prefer not to separately track very small items, and encourage bonding capacity for building, facility and equipment improvements of longer-term value. A $250,000 threshold for capitalization is not unusual for a very large company, but considering a single, very expensive elevator thoughtfully in our town’s circumstances would indicate that an estimated cost of $203,000 — which will likely be higher in the current inflationary environment anyway — potentially coupled with other long-term upgrades, should clearly be capitalizable and bondable.

“Why don’t we group together the under-$250,000 in long-lived items so they together qualify under the — in my view, somewhat arbitrary and arbitrarily-applied — internal guideline? The older buildings in town, especially the schools, require the ability to preserve structural integrity through bonding. The alternative is that all older buildings will fall into disrepair and require complete replacement, which is a poor, long-term management alternative.

“The BOE should quickly prioritize its previously-considered capitalizable projects for bonding and group items together, as phases of a bigger project to maintain the integrity of infrastructure, just as the town does for roads, etc.

“The reason that I and others have been asking for the BOE to separate its budget into long-lived capital improvements for a while was for exactly this reason:  to thoughtfully manage town facilities. The problem with the application of an internal policy like this to our town expenditures is that it favors very expensive replacement of entire buildings. It is unacceptable to me to suggest that nothing short of a complete replacement of a building (since every individual component … floor tiles, ceiling tile, electrical conduit, electrical components… is under $250,000) is bondable. It makes no sense to apply it like that.

“In order to fit into the existing BOS policy, I hope the BOE will go back to the BOS with a component, step-by-step plan of renovation. Each phase should meet that $250,000 threshold. I don’t get a vote at the BOS, but that approach seems the most sensible to me and I would hope, to other reasonable people who want to best manage town buildings for the long term.

“School roofing projects were bonded in the past. School elevators and major long-lived projects should be evaluated the same way — unless there is a desire to keep school items off of the ballot this year, which is unfair to the schools and short-sighted. Both the Police Station upgrade and the much-needed school upgrades are necessary and supportable by town residents.

“I would add that given that inflation is running at a rate that is multiples of the town’s borrowing rate, it is actually cost-effective to make capital investments now, as opposed to delaying necessary investments.”