April 7, 2016—5:50 p.m. Editor’s note:  This is a looooong article. I’ve summarized what the Board of Finance members said in their opening statements. Part 2 will follow with the board’s debate and the uneasy back and forth with BOE chair Bruce Likly. 

After multiple public budget hearings, board meetings, publicly shared information on the town’s tax collection and revenues, ending fund balance woes, small grand list growth and unavoidable debt service, and high numbers of emails from residents, Wilton took one step closer to finding out what size tax increase they’ll be voting on in less than a month. That’s because last night, the Board of Finance began its deliberations on setting the mill rate and finalizing budget numbers from the Boards of Education and Selectmen.

While they stopped short of finalizing an actual mill rate on Wednesday night, they did agree on cuts to both the boards’ budgets—they cut $213,000 from the proposed BOS budget, bringing that in at $32,201,880, or a 0.06-percent decrease from the current year; and they told the BOE to reduce their proposed budget by $400,000, bringing it to $80,572,640, which is a 0.77-percent increase from FY ’16.

The BOF expects to finalize the mill rate tonight (Thursday, May 7) at 7:30 p.m.. They left calculations at the end of last night’s meeting with a potential mill rate of 1.89-percent, and will take the formal step of proposing an official resolution tonight.

But at many moments during the last night’s meeting, it was clear that the path to getting to that 1.89-percent was painful and tense, most obviously in interactions between Board of Education chair Bruce Likly, and two members of the Board of Finance—in particular, chair Jeffrey Rutishauser and newest member Peter Balderston. Prickly and pointed at times, the language used made it clear the officials are far from seeing eye-to-eye on what the cuts mean for Wilton and for the schools. Especially frustrating for Likly it seemed, he had little opportunity to react publicly to criticism directed at the BOE as last night’s meeting didn’t technically allow for public comment. He was extended the courtesy of responding briefly, but the sense was he didn’t like what he was hearing.

Balderston was the lone member of the board who voted against the $400,000 BOE cut, saying he would have preferred to eliminate the entire increase and keep the budget flat year-to-year. He might have had other board members vote with him, if the majority of input from members of the public hadn’t been so loudly supportive of the proposed school budget in emails and at the education budget hearing. That’s what first selectman Lynne Vanderslice thought, especially in light of the unhappy reaction to the cuts from residents who felt the BOF didn’t listen at all.

“I think the parents were heard. If the parents hadn’t come out, I think the reduction in the BoE budget would have been larger, from everything that had been said by BOF members prior to the public hearings. The indications were it would have been a much bigger cut. We are in an extremely difficult financial environment. The state is looking at a $500,000 cut in our aid, and the BOF could have gone for much deeper cuts but they chose to take into consideration what was said by supporters of the education budget” Vanderslice told GOOD Morning Wilton.

Likly sent this comment to GMW about the meeting:

  1. We’d prefer to see no budget cuts; we presented a lean school budget which is now going to be even leaner. We are getting very close to the bone, I think our kids deserve better from us.
  2. It is my view that the BOF believes it is operating with a mandate that does not reflect the majority.
  3. The tone and attack mentality of the meeting was not productive, and at times sunk to the new lows that seem to characterize the current discourse in town over any issue.
  4. If we are to address the current fiscal realities faced by the town, we need to work together in a cooperative manner. The BOE is willing to step up and do its part, but the fact of the matter is that this issue is not going away until we address the broader issue of the grand list.

Discussion

Rutishauser opened the meeting by noting that there will be a $2.6 million shortfall bet. resources and needs. Tonight the goal is to close that $2.6 million.

Each member of the BoF gave an opening statement. Major points are quoted below; links will be provided to each speaker’s complete statements if they were provided to GMW.com.

Peter Balderston

(Text of his full remarks can be found, here…)

“I cannot support the requested $1.02 million (or 1.27-percent) increase in the BOE’s FY 2017 budget. I believe, instead, that holding the Board of Education’s budget flat to last year is appropriate. Wilton School system enrollment peaked in 2009 at 4,412 students – that was a full seven years ago. Enrollment in our schools has been declining ever since. …During the last seven fiscal years, school budget increases have averaged 2.28-percent annually while district-wide enrollment declined a total of 6.62-percent or approximately -1 percent per year.

“I bring a private sector point-of-view to my role here on the Board of Finance. When you start losing customers, you need to shrink the staff that serves those customers. The taxpayers of this town have been very generous to our school system over the past seven years during which the number of customers it serves has declined. We’ve known about these reductions for some time now, and we know that these reductions will continue for at least the next four to five years.

“The Board of Education has been slow to respond to enrollment declines over the past seven years and it’s time to manage down the growth of our school budgets relative to the number of students it serves. Knowing the challenges we face as a town, the Board of Selectmen has taken a leadership role this year by proposing a 0-percent increase, and I think our Board of Education must do the same.

“We’re just beginning to deal with a very difficult problem and we must be balanced in our approach to any real estate tax increases going forward. The Board of Education, like the Board of Selectmen, must develop and publish a strategic, multi-year plan which lays out—in very tangible ways—how it intends to manage down, over a multiyear period, its largest variable cost in tandem with this protracted decline in enrollment.”

John Kalamarides

(Text of his full remarks can be found here…)

“Let’s keep the BOE budget at a 1.1-percent increase as we gave them guidance last fall. Let’s keep the BoS budget at a 0-percent and let’s move the ending estimated fund balance from 11.2-percent to 10-percent. I don’t want to endanger our AAA Moody’s rating. What I’m proposing will not result in a 2.27-percent [tax] increase but 1.49-percent increase.

“Let us tell the BoE that we will approve this year’s increase, but they must come in with a flat budget for next year. so we’re basically approving a 2-year increase now. We must  give notice to the BoE that they must make clear over the next funding period that they must explain how they intend to downsize personnel, teachers and administrators, and budgets, given that enrollment is predicted to fall over the next several years, or why they must keep the personnel and budgets . I would ask the discussion be done in an open and honest manner without confrontation.

“I disagree that we need to make these deep cuts to the BoE and the BoS budgets and begin a spartan existence in Wilton. We have two great draws for people to come live in Wilton, our fine school system and our triple-A credit rating. Our realtors told us that yes, taxes are a consideration for potential homebuyers, but taxes are not the whole argument. Wilton, traditionally, is the last town in fairfield county after a recession to have its real estate prices move up in values.

“I cannot morally justify any further reductions in the BoE budget after we gave them guidance of a 1.1-percent increase. Yes we can cut the $130,000 difference that they brought forth to a 1.1-percent increase. Anything further would endanger the quality of our school system which is our shining star.

“This year we saw Middlebrook Auditorium filled and voters speaking 4-to-1 in favor of the BOE budget. GOOD Morning Wilton‘s poll showed 2.76 to 1 in favor of the town budgets as presented. Letters sent to the BOF were in the same ratio. We cannot ignore what Wiltonians have said to us. They are in favor of the budgets as presented.”

Walter Kress

(Text of his full remarks can be found here…)

“I heard a lot of people say leave the budget as is. I want good schools too, but I’m afraid they’ve been led to believe that a cut in the budget will lead to the degradation of education. I don’t believe that. I’m not talking about a massive cut but I think there are efficiencies that can certainly be wrung out of this system.

“Focused leadership can determine appropriate reductions to wring out inefficiencies will lead to maintaining or improving the delivery of the education experience we all cherish.

“The better way to resolve these challenges is not to take them in one year isolated budget bites, but rather build effective three-year planning tools. I’d like to see that adopted by both boards, to have a three-year planning process.

“Enrollment is declining, failing to recognize that is irresponsible. Class size are at or through self-induced guidelines. Cutting classroom teachers is the most damaging decision to implement, and that’s what has been threatened. Find another alternative, there is no silver bullet. Although the BoF does not have authority to cut the BoE budget, we can apply good business decisions and common sense recommendations for improvement. Savings will be earned through implementing a series of thoughtful smaller reductions, $50,000 here, $75,000 there.

“There is more staff as measured by FTEs (310) than classroom teachers (276).  The opportunity for efficiency gains are in the administrative side, not the classroom instructor side.

“I’m sure there are Board of Ed members who might consider this meddling, but any good business person would find the same issues and ask the same questions – this is not rocket science.  The Board of Finance is doing it on behalf of the town.”

Richard Creeth

(Text of his full remarks can be found here…)

“I served on the BoS and I know the effort and expertise that goes into the BOS budget. I could only imagine the amount of professional expertise that goes into the BoE budget. I am not an educator, and I don’t think I could understand what is important from an educator’s standpoint.

“We held two public hearings, the BOE one was very well attended, probably 400 people, maybe more; we’ve received probably 85 communications—an email or someone standing up to comment at a meeting, when you eliminate the duplications between them, it’s been about 80, 85. I’ve been reluctant to give out tallies. It’s extremely dangerous to draw conclusions from a small sample not properly selected. We’re trying to minimize the tally and more look at the sense of the communications.

“They’re running slightly more than 2:1 in support of the budget as is, without cuts. The GOOD Morning Wilton poll, the numbers picked up, it’s running 5.6:1. It’s dangerous to draw conclusions, but it’s fair to say, we’ve had more input in the budget process this year than we’ve had in a few years. The communications have ranged, but the majority are supporting the budget, saying don’t cut the BoE at all. There were a lot less suggestions about the BoS budget.

“Given that we gave the BOE guidelines of 1.1%, they came in at 1.27%, a difference of $137,000. In the corporate world that difference we’d call immaterial, so they came in close to our guidelines. I have a tough time cutting them below our guidelines. But we need a compromise, and I’m willing to consider that. The rationale for that is there are some things we couldn’t foresee that have turned out worse than we expected.

“I would cut $137,000 from the BOE budget, but actually if I had my complete choice would leave as is.

“The strategic plan for the BoE, we have to do that, it’s really important. Next year’s BOE budget has to be much, much tighter, it has to be close to flat in my book, because enrollment is continuing to decline.

“For the BOS, what concerns me is those cuts are coming from the operating capital budget and I don’t support that unless Lynne can tell me we’re not putting anything off, or being pennywise and pound foolish.

“With general fund balance, there’s been debate about 10%. I think we all know that 10% is one of the key factors in our AAA bond rating. But we just went through the worst economic downturn and we never went below our 10%. I have a question for the board:  if that 10% wasn’t for a rainy day, and we just had a rainy day, when are we going to get a rainy day? I think we could be a little tighter with the general fund. I’d go, perhaps, to just a little above 10%. I would leave a cushion but not as big as $1 million. We’re all wrestling with this.”

Warren Serenbetz

“Looking at where we are, in the 2.6 million shortfall, if you take the BOE budget to zero, and you look at what that does to the mill rate it still is 1.27% because of the debt service and the impact of the general fund. If you normalize the general fund to be flat with last year, that gets down to .77% increase. In my opinion, that is a minimum of where we should be in terms of a tax increase, because the voters voted to incur that debt so that debt has to be paid for.

“One of the things we’re charged with doing is looking at if we think there are places the boards can cut. I know we set 1.1%, there have been a number of changes since we set that that can justify going below 1.1%. Do I think we could cut to zero this year? No, so where is the middle ground. Halfway? Maybe, maybe not.

“On BoS side, I’m very happy with their zero, but if there are identifiable cuts that can be made without doing stupid things, that’s an opportunity to reduce the tax burden. And then we’re looking at the general fund and where do we want to go from there.

“I too think there is some room to move. If we take the BoE down by $400,000, take the BoS down [$213,000], and change the unassigned fund balance to 10.7% instead of 11.2%, I think we can get to a 1.08% increase, which I think is acceptable to the town.

“We see more engagement by the community. A lot of people expressing support of the BOE budget will be coming out to vote. We may see no votes stay the same, but the yes vote may come back up.”

Jeffrey Rutishauser

“Next year is going to be particularly difficult. The extent we draw down more this year, means we’ve got a much larger step the next year. It will make this year easier, but next year steeper.

“What the BOS did this year is extraordinarily. Each year before has been 2-2.5% [increase] per year, and this year they answered the call. They forewent that 2.5%, about $600,000-$650,000 they cut their own budget. But that still leaves a $2.6 million hole. In the spirit of trying to pull together a solution for Wilton they dug even deeper. They could have said, ‘nope we’re done, go find it elsewhere,’ but they didn’t do that. They rolled up sleeves and made second effort. That was truly extraordinary. For that we’re grateful.

“The BoE is by far our biggest board, 3/4 of the budget, I really struggled with this last night.”

Rutishauser showed a slide presentation, staring with a bar graph illustrating the BoE budgets over the last 17 years.

“This is the total education budget since 2000. This shows an extraordinary generosity of Wilton in supporting the schools. If you add up all these bars, it’s over $1.1 billion in 17 years. That’s more than 25% of our grand list.”

Rutishauser then introduced a slide that showed the same bar graph with the addition of a bar representing the proposed FY 2017 budget, and followed it with a slide that replaced that bar with one that represents a hypothetical flat FY ’17 budget. He proceeded to flip back and forth between those two slides to show what he called a “little” difference.

“That is the difference that was the source of such hyperbole and fury of how much we’re going to cut. In that difference was freshman sports, the kindergarten teacher at Middlebrook [sic], the arts program at Cider Mill in that little piece there. C’mon folks, look at the bar underneath. That is the difference between a great school year, and utter disaster. I don’t buy it, I just don’t buy it.

“Then look at the budget per pupil:  this is more important than the static budget. What matters is what each student has, not the size of the gross budget.

“If we’re declining rapidly, this is what we should be looking at, the allocation of resources of the town toward each student. If we reduce it to zero, the per-pupil expenditure goes up by 2.4%. That’s because the number of students goes down by 2.3%. It’s in line with the last 5-6 years. It’s not out of line, it’s not drastic, it doesn’t gut the school system. It’s an incremental change and I don’t know a management team that’s worth its salt that can’t find a 1.27% out of their budget. You wouldn’t even notice it, and it certainly wouldn’t cost us the football team or the lacrosse team. Such a small increase created such a large storm. People calling it catastrophic. It won’t.

“Enrollment is starting to decline rapidly, about 100 students per year. We have to manage to this. We haven’t been managing it to this. This is the number one challenge to the BOE. We have to align our resources to this. Not the way we wish it to be. We’ve got to start preparing as a town to provide resources on per-pupil basis, not a gross basis, to handle the decline without overstaffing, particularly the non-teacher positions.

“In 2012 … we had 7.5 students per staff. Let’s assume we assumed that was the most efficient. The number of students is going down we still have 6 more people than in 2012. We’re heading to 7.0 students per staff. That shows we have excess staffing. We have not been managing it down as we should.

“If we did staff proportionally, we’d have 38 fewer staff; we actually have 6 greater staff. The cost per staff is about $100,000 per staff, on average; 38 people is $3.8 million over what it should have been if we had been operating as efficiently as it did in 2012. We’d be paying $3.8 million less per year. That’s the potential. We’ve been doing baby steps. If we don’t bring the staff down as students go down, we’re paying more than we should with a school size bigger than it needs to be for the number of students we have.

“Every dollar is important. Look at the potential we have to size it appropriately for the number of students we have. We need to do what we can to be more efficient so those bars aren’t as large. A year to year zero percent increase per pupil is out of line.”

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