Singing those "Rock and a Hard Place" Blues...

A long post about money woes; digest in small bits.

For those of you unable to attend the Chapter 70 presentation offered tonight by Dave Tobin, who works with the Massachusetts Association of School Superintendents, you missed an expert and somewhat demoralizing explanation of upcoming changes in the Chapter 70 School funding laws that will benefit Newburyport over the coming four years-- sort of.

A quick overview (look for a linkage to useful documents in a day or two) is that when the Education Reform Act of 1993 was adopted as law, it used certain formula to calculate a number of factors affecting the amount of state aid going to municipalities for schools. The good news is that for the first time since 1993, some of those formulas will be adjusted. Slightly. Over time. One would say glacially, but at the rate glaciers are melting, that would imply far greater speed than we are looking at here.

In 1993, the state established what is called the "Foundation Budget", which essentially established the cost of providing a "fair and adequate minimum" funding per student- that is, the Foundation Budget establishes what it costs to educate a student. Since it has not really been adjusted since 1993 to any significant degree, it is fair to say "what it cost to educate a student in 1993." That would be the same 1993 that is 14 years ago. That one. Yup.

The next part of the formula was establishing a standard minimum for each community to pay towards education; this was based on a very complicated series of calculations somewhat related to demographics, evaluations, the number of blintzes consumed on a monthly basis, whether or not it was a good year for lemmings, and the number of letters in the Governor's middle name. Sorta mysterious. What the state did, in effect was say, "Hey Newburyport, since you have exceeded what we think you need to pay by supporting your schools better than many other communities, we'll set your local contribution at that 'high water mark.' That way we won't have to screw around with any magical formulas!"

Ahem.

Finally, Chapter 70 Aid was supposed to make up the difference between A (the Foundation Budget) and B (the local contribution). Net School Spending is therefore equal to, or exceeds the total of Municipal Spending plus Chapter 70. Of course, the only way NSS would exceed Foundation would be if the municipal spending exceeded the minimum required by the state.
Which Newburyport, to its credit, has nearly always done.

You can see where this is going.

The next bit of '93 Ed reform news was that any money needed for charter schools would be taken right out of the 'cherry sheet,' the state estimated aid for the given fiscal year. Without arguing about the need, or efficacy of the charter school, the net result impacted state aid for Newburyport.

Cut to 2004, a good year for cheese, but not for state revenues. The state, low on revenue, pulled a number out of the hat and took back 20% of the Chapter 70 Aid from every community in the Commonwealth. They soon discovered that such a dramatic and seemingly arbitrary cut would push a number of school systems to funding levels that dipped below the Foundation Budget. Those communities saw their money restored. Newburyport did not.

It cost us $750,000. If the number sounds familiar, it is the average deficit run by the schools for the years 2004-7. Punched a whole in the budget that you could drive a mack truck through for four straight years. Five, if you count last year, six if you count the year to come. Like clockwork.

The good news is that there has essentially been legislative "buy-in" to a plan developed jointly by the MA Association of School Committees, and the MA Assoc of School Superintendents; at some point, this will be codified into law at some point.

The new formula will include setting a floor for minimum Chapter 70 Aid at 17.5% of Foundation. Nbpt has fluctuated over the past five years between 24.8% and 17.8%.
Well, that doesn't really look like a winner for the City, does it.

It also caps the Local Contributions (the local support expected) at 82.5% of Foundation. Newburyport has exceeded minimum local contributions; it has had to, because the formula in use has inadequate inflation estimates factored in, and the overall Foundation budget is filled with expense estimates that have little relationship to the reality-based community.

The upshot, the good news, is that Newburyport can expect a gradual reduction in local expected contribution of about $4,000,000 over the next four years; that hole will be filled by additional state aid which is estimated to total, over the next four years, top estimate, no fooling around, not kidding, of $640,000.

Well, I bet you can see a problem here, can't you. We're heading backwards. At top speed.

I'm putting a lot of faith in the School Revenue Task Force, most of whose members were in attendance tonight. I'm hoping that those City Councilors who were present, don't rush off in the great excitement of reallocating that money away from schools and into other City projects, not just yet.

Folks, we have some thinking and wishing and a lot of creative work to do in the months ahead. More information on the new formula tomorrow; and about the presentation in the days ahead.

Sheesh.