The $3 million Fiscal Year 23 budget surplus reported last month by the Needham Public Schools may increase by as much as a few hundred thousand dollars once the school finance staff finishes reconciling payroll and other budget items.
The School Committee voted last Friday to reallocate the funds, diverging considerably from the plan that had been proposed in June when the surplus was announced.
Superintendent of Schools Dan Gutekanst had put forward a plan to use the state’s circuit breaker law to carry roughly $2 million over to the FY24 school budget and return nearly $1 million to the town budget.
The schools now will return more than $2 million to the town budget, twice as much as had been proposed. The money will be added to the town’s Free Cash line where it will be available to be spent on non-school needs in FY24. The remainder of the surplus will be carried over to the FY24 school budget.
Gutekanst acknowledged the adjustments were made in response to concerns raised by the Finance Committee (FinCom). NPS had initially planned to allocate some of the surplus for funding of capital projects and other items that are traditionally reviewed by the FinCom.
The FinCom outlined its concerns in a four-page memo on July 10 from Chair John Connolly. Among other objections, the memo questioned the process the schools were using and expressed the concern “that we do not believe it is appropriate or good practice to create a ‘contingency fund’ within the School Department budget, given the several reserve and stabilization funds already at the Town’s disposal should unexpected costs arise.”
“I had a good, healthy conversation with John Connolly, who is a good partner to work with,” Gutekanst said. “It’s fair to say that we did not agree on every single point, but the FinCom made reasonable arguments.”
As a consequence, rather than carrying over some $2 million to the school’s FY24 budget, the School Committee voted instead to commit $1.4 million of the surplus funds to be spent in FY24 — the bulk of it on special education funding.
“We have a great deal of respect for the FinCom and how they support the best interests of our students, which is our primary concern,” Gutekanst said. “But they (FinCom) have to balance that with the best interests of the town, so we reached a consensus that this was the best way to move forward.”
Breakdown of the spending:
$642,433 – Special Education tuition and transportation expenses
$299,830 – An additional Intensive Learning Center (ILL) at the Newman School to meet the needs of incoming students, and a part-time Teacher of the Deaf position
$237,340 – Auditorium repairs at Newman, Pollard and Needham High
$149,855 – Document management and other technology needs
$145,000 – Preschool playground improvements and other needs
The surplus was attributed last month primarily to the nationwide disappearing workforce trend. The schools had persistent unfilled vacancies that equated to more than 16 full-time equivalent positions. There was also a surplus of more than $1 million in non-personnel spending categories.
Gutekanst said surpluses are hardly unprecedented, but they usually represent 1% or 2% of the overall budget. The FY23 surplus represents nearly 4% of the $87 million school budget.