Budget Hearing Meeting - April 25, 2002
Minutes
BETHLEHEM AREA SCHOOL DISTRICT
BOARD OF SCHOOL DIRECTORS
BUDGET HEARING #1
APRIL 25, 2002
BUDGET HEARING #1
The first 2002-2003 budget hearing of the Board of School Directors of the
Bethlehem Area School District was held on Thursday, April 25, 2002, beginning
at 6:11 p.m., in the Education Center Dining Room, 1516 Sycamore Street,
Bethlehem, Pennsylvania.
MEMBERS PRESENT
Members present: Directors Amato, Craig, Gallagher, Haytmanek, Heske, Koch,
Leeson, Venanzi, and Williams - 9.
OTHERS PRESENT
Others present: Thomas J. Doluisio, Superintendent of Schools; Stanley J.
Majewski, Jr., Board Secretary; administrators; members of the press and other
interested citizens and staff members.
Director Amato announced that the meeting was the first of two meetings for
review of the 2002-2003 proposed budget for the Bethlehem Area School District
before the board will vote on its approval. Mr. Doluisio and Mr. Majewski will
review the budget, followed by questions from the board.
MR. DOLUISIO - INTRODUCTION OF BUDGET
Mr. Doluisio remarked that the main points of the budget can be gleaned from the
Letter of Transmittal, but he wished to highlight one or two areas. The central
information is that, on the revenue side of the budget, the state of Pennsylvania
has seen fit to increase the ESBE formula (the formula used to calculate the
subsidy from the state of Pennsylvania) by one percent. That does not represent
a fair share on the part of the state of Pennsylvania in terms of funding public
education. The state has granted a 1.5 percent increase in special education
funding. Special education has been one of the fastest growing expenditures in
the budget. When the district receives a 1.5 percent increase but must comply
with state mandates and the special needs of these special children, it is
unrealistic of the state to think that it is even approaching a fair share of the
cost of special education.
Mr. Doluisio stated that he is pleased that, since the release of this budget,
some good news came from the state of Pennsylvania. He complimented our
legislators who worked very hard on our behalf to decrease the district's
retirement contribution by responding to the call and the information that the
original formula was about a 517% increase to the Bethlehem Area School District
and similar increases for all school districts. The afternoon of the day the
budget was released, information came in which allowed the increase in retirement
to go from 3.51 mills to 2.87 mills.
Mr. Doluisio stated the one most important fact to realize is that 94.4% of the
increases in the budget are in four categories:
¥ Intersystem Payments. The major increase is special education costs to the
Intermediate Unit for special needs children.
¥ Employee Benefits.
¥ Debt Service has increased by $1.5 million. The debt incurred is money the
district has borrowed in order to totally renovate or build new 13 of 16
elementary schools, a new transportation garage, new science wings at the
high school, a large addition at East Hills, and the capital improvement plan
which has kept our district in such fine shape, physically.
¥ Teacher Staffing. Enrollment increases, the elementary preparation period,
and five teachers for the Academic Academy represent the staffing increases.
There is very little control over teacher needs for enrollment increases or
for prep time unless class sizes are increased.
Mr. Doluisio commented that 40 of the 64 budget categories have a zero or
negative change from the 2001-2002 amended budget.
Mr. Doluisio stated that there is a dire need for realistic tax reform in the 501
school districts of the commonwealth. This antiquated system of overburdening
the property owner and senior citizens is crippling school districts who have as
their main source of revenue the property tax. It is regressive and unfair. The
state of Pennsylvania has a better way to bring money and revenues into the local
school district, the state income tax, whereby working people pay and those who
earn more pay more than those who earn less. He would implore our legislators to
provide realistic tax reform that will take some of the burden off of each local
school district and transfer it to the wage earner through some equitable state
income tax so that senior citizens can be saved from the burdens they are
undergoing and the property owners in general.
Mr. Majewski reviewed the revenue areas. MR. MAJEWSKI - REVENUES Mr. Majewski
referred to pages six and seven.
¥ Real Estate Tax. The majority of increase in assessment would have been the
result of construction occurring, primarily, in Bethlehem Township. It is
expected that the trend will continue for another year or two. The value of
a mill typically is increasing at a rate lower than the CPI. The proposed
budget includes a 9.6% increase in the real estate tax rate, an increase of
2.87 mills on top of the current 29.9 mill rate. Counties make a market
value assumption of property. For example, if a house has a market value of
$120,000 in both Northampton and Lehigh Counties, a 50% assessment value is
used for real estate tax purposes. When the property tax bill is received,
the owner will see a $60,000 assessment. That is the base for calculating
the tax bill. Take $60,000, divide it by $1,000 which would be one mill,
multiply it times the millage rate to calculate the base amount of the real
estate tax bill. In the Bethlehem Area School District, the average
residential property has an assessed value of approximately $60,000. A 2.87
mill increase, using a $60,000 assessed value, will give you an increase of
$172 on the base bill.
¥ Public Utility Realty. A decrease of $186,000 from the current year's
budget is shown. Several years ago, there was a change in the way utilities
were providing funding to the Bethlehem Area School District. Plants that
are generating electricity are now put on the real estate tax rolls.
However, the public utility reality tax which several years ago generated
about $800,000 a year in revenue for us has been a decreasing amount. We are
projecting that next year we will receive $114,000.
¥ Earned Income Tax. A decrease of $156,000 is shown. That reflects a
slow-down in the local economy. We were anticipating larger increases in
receipts in that category than we will actually receive. Mr. Majewski
projects that this year we will receive approximately $8,500,000. Looking at
what amounts to be about $200,000 increase, it will increase the EIT budget
to about $8,700,000. It may be a decrease from current year budget; however,
the category still continues to be increasing, but at a slower rate.
¥ Interest on Investment. Mr. Majewski explained that the district currently
has a $1,600,000 budget for return on investments. It was hoped that
interest rates, as they were decreasing last year, would have at some point
leveled off and possibly increased. However, the rates continue to decrease.
He projects that this year the district will receive about $1,200,000 with
the understanding that he is hearing interest rates will very likely rise
within the next year; however, not at a very rapid rate. That budget has
been increased. It reflects a $25,000 decrease from the 2001-2002 budget.
However, in reality, he is expecting receipts to go up next year.
¥ Basic Instructional Subsidy. Mr. Doluisio spoke about the one percent
increase. When looking at that line item, it shows it is only increasing
$8,185. That is not one percent. What had occurred is that last year when
the Governor's budget came out, the state told us what we could anticipate
receiving. That amount was budgeted. However, when the year began and the
state started paying the district, the amount received was about $148,000
lower than the projected amount. The district is receiving a one percent
increase, but it is based upon lower receipts this year, which were lower
than what was projected. The same is true for the special education subsidy.
¥ Pension Contribution. This item shows that the district will be receiving
$1,900,000. That amount will decrease to about $1,450,000 because our costs
are going down. The state provides us with 50% reimbursement for our costs.
A line item of $3,800,000 has been budgeted. That will be decreasing to
approximately $800,000. One-half of that will decrease the revenue side to
about $400,000. The amount will go down; however, the expenditures will go
down in equal percentages.
¥ Reserve Fund Balance. Mr. Majewski stated that in order to be able to keep
the tax rate down, the district will use $2,000,000 of reserve fund balance,
which is an increase of $1,000,000 from the current year.
MR. MAJEWSKI - EXPENDITURES
Mr. Majewski pointed out a few additional expenditure items, in addition to those
covered by Mr. Doluisio.
¥ Insurances. Insurances have gone up, not by a very large dollar amount
compared to some others, as a result of September 11. Insurances on
liability and property will probably go up from 50% to 100% next year.
¥ Health Benefit Costs. Mr. Majewski stated he is expecting health benefit
costs to increase, depending on the type of benefit, between 8% to 12% with
prescription drug going up slightly higher. Approximately $1,000,000 was
placed into the benefit line item as a result of health care costs.
¥ Retirement. In that line item, the cost of retirement will be reduced
because of the rate reduction. Currently, $3,800,000 is shown as the budget.
It will be reduced by approximately $3,000,000 to approximately $800,000.
The state is changing the manner of calculating the effect of investment
returns on their rate. As a result, they were able to lower the cost to the
employer. You can anticipate that the increases, as a result of lowered
investment returns, will be spread out over more years.
QUESTIONS FROM THE BOARD
Director Leeson asked the administration to address the concerns of the people
that spoke to the board about staffing at East Hills Middle School. Mrs. Kostem
stated that, overall, an 11.6 teacher increase is proposed for East Hills next
year. Eight teachers will be added because there will be eight additional
sections at that school. Also, 1.5 are proposed because additional music and
physical ed teachers are needed to accommodate those increased sections. A half
guidance counselor increase has also been included. The school will be close
enough to 1500 next year, in its size, that it will receive a full-time nurse.
This year, East Hills has a nurse most of the time. When the nurse is not there,
a health assistant is present. There will be a .6 increase in special education.
The administration is suggesting a new position for the school called an
"academic resource teacher." There has been an "academic standards trainer" at
the middle school level for several years. This position would be altered and,
instead, assign it most of the time to East Hills to assist with certain duties
that are present at the school. That totals 11.6 additional teacher positions.
Director Leeson asked if this is based on an anticipated increase of enrollment
next year or if it is based on this year's enrollment. Mrs. Kostem stated two
issues are impacting the increase of eight sections. First, more students did
show up at East Hills for this year than were originally planned for. East
Hills, this year, has had a larger pupil-to-teacher ratio in its sections in each
grade level than initially planned. This increase is first to reach the
district's target of 28 to 1 for our academic sections. That takes between three
and four sections more. In addition, next year will be the second year of our
phase-in of a new area from the south side. A year ago some boundaries were
changed and the phasing-in of a new neighborhood was begun. Next year will be the
second year of that phase-in. Therefore, an increase is expected at the school,
but is not worth, for next year, eight sections. Some of that is a leftover from
trying to adjust for this year. It is difficult for middle schools and high
schools to add staff after school is underway.
Director Heske asked how the revenue from the Bethlehem Steel Company's taxes is
being treated in this budget, both for last year which we did not get, and what
we think will happen this year. Mr. Majewski stated that we are due
approximately $900,000 for current year real estate tax that, based on
information received from some of the bankruptcy people at Bethlehem Steel, we
will never get. Mr. Majewski stated he is anticipating that the district will
receive payment of the real estate taxes next year. He has called them and
spoken to some of their officials regarding their intent with payment of the real
estate tax for the 2002-2003 year. They assured him that, as long as the
organization was operating and financially viable, they were going to make
payment. Based on what is being read in the newspaper now, the Bethlehem Steel
seems to be somewhat improved. It appears likely that the district can
anticipate receipt of the current real estate taxes in next year's budget.
Director Heske asked, overall, what type of an increase the district is expecting
in enrollment. Mrs. Kostem stated that 391 more students are expected: 76
elementary, 200 middle school, and 115 high school. Director Heske stated that
this year the district did not have any students in a charter school. The
proposed budget allows for 200 students to attend a charter school. He felt the
estimate is high because Bethlehem is not the only district that will be
furnishing students to that school. Secondly, there are significant start-up
costs that will be required for these people to go into business. At the state
the charter school is in right now, he would be surprised if they got more than
150 of our students. Mrs. Kostem stated that the projections do not include any
impact from the charter school, except for the budget. The budget is there, but
in the staffing of the schools for next year, there has been no reduction allowed
for any students to attend the charter school. Just as last year, when we know
further information, it will be determined whether that impacts any one of our
elementary schools or any one of the grades in any one of our elementary schools
sufficiently to be able to decrease teachers. Last year at about this time, the
charter school was a little further along and able to supply us with some
potential names; we were able to look at the impact on potential schools. We are
not at that point with the charter school right now.
Mr. Doluisio added that within the last week he has had two discussions with Mr.
Hackett, the founder of this charter school. He told Mr. Hackett that $1,200,000
was included in the budget because we are assuming that the majority of the
students, if not all of them, will come from Bethlehem. We did not assume that
last year. We are assuming a little more along those lines this year for two
reasons: the Bethlehem location and the location is attractive. Mr. Hackett has
confirmed to Mr. Doluisio that he thinks the vast majority of the young people
that go to this charter school will, in fact, be from Bethlehem. He also said
that he needs 200 seats filled in order to make his budget. Mr. Hackett will be
present at a hearing on May 20. On the other side, we have not anticipated any
savings to our budget because we may lose 200 students because we don't know how
many have registered yet and, once we receive registration facts, we need to find
out where these students go to elementary school. If we take 200 students out of
16 elementary schools in five or six grades and it is randomly selected, the
district won't be able to yield much of a savings, if any. The other expenses
are fixed such as heating and lighting. On both sides of the question, there is
a lot of vagueness yet. Mr. Hackett is not going with a management company this
time. He is using a new curriculum, which is similar to the Paragon curriculum,
a Mosaica. He has an upgraded location from his original proposal a year ago.
These are attractive elements in terms of getting enrollment for that charter
school. Hopefully, before the end of this budget, the district will have a
better idea of how many children and where they are coming from will attend the
charter school. Director Heske stated he appreciates what Mr. Doluisio is
saying, but he told the district a lot of things last year, too, which did not
materialize. He is involved in a suit. If there were any judgment against him,
Director Heske thinks Mr. Hackett would be bankrupt.
Director Craig stated that if the charter school gets 200 students and they all
come from Bethlehem, that does not mean they are 200 Bethlehem School District
students, just that they live here. He guesses that a good portion of those will
be students who are not now occupying seats in our schools.
Director Heske stated that one of the reasons this board did not give them a
charter is that we thought their financial situation was less than adequate.
That proved to be right. He would not be surprised if they don't do nearly as
well as they claim they will do. That is an area that should continue to be
looked at as far as some reduction.
Mr. Majewski added to Director Craig's comment. He stated we currently are
paying one charter school within the Bethlehem Area School District. To his
knowledge, not one of those students attending there left the Bethlehem Area
School District. Up until those charter school payments were being made, those
students did not cost the district anything. That, very likely, is going to
occur if a second charter school opens in this district.
Director Heske stated that at the finance committee meeting there was a strong
consensus that most of the athletics expenditures could not be afforded at this
particular time. He thinks that would account for a little more than $30,000.
He proposed that it be eliminated.
Mr. Doluisio stated that is concerning a coaching clinic for $10,000, $14,000 for
12 new coaches at the middle school level. These items are in code NC on page
52. Director Amato stated that the proposed increase is $92,363. Mrs. Kostem
stated she believes Director Heske was referring to three items he felt should be
considered for reducing:
¥ $9,000 to increase two secretaries from 10 months to 12 months, which the
administration has stated would not be done next year.
¥ $14,370 was proposed to begin an assistant coach's position for three sports
at the middle school level: field hockey, girls volleyball, and cheer
leading. That was in the athletic proposal made a number of years ago. Now
the feeling was, again, that this could not be included for next year's
budget. That is an additional savings of $14,370.
¥ Also included in that budget was $10,000 for coaches' conferences and
clinics. The recommendation was put on hold for next year's budget.
Mrs. Kostem continued, stating that there is an increase in that line item of
$16,893 that is responsible for putting three duplicate teams at East Hills
Middle School for next year. The administration supported that because the size
of the school suggested that it would be good to have a second equivalent team in
some of the sports, not a JV team, but an equivalent team. This budget includes
money for girls volleyball, a girls softball, and a girls and boys soccer team.
The cost of that is estimated at $16,893. That did remain in the budget and is
still being recommended by the administration.
Mr. Doluisio confirmed the fact that the administration is recommending the
addition of the teams at East Hills due to its size. The children at East Hills
are not getting an equal opportunity to compete in the sports program as with
other middle schools. Duplicate sports will give the East Hills children the
same advantage. Mr. Doluisio stated that he concurs with Director Heske's
recommendation that the other three items can and should be eliminated from this
budget in light of the tough budget year the district is experiencing.
Director Amato asked confirmation that the three items proposed for cutting are
included in the $92,363. Mrs. Kostem stated the three items are in that number
right now. The administration is recommending a cut of $33,378 from that amount.
Director Amato questioned that the administration identified $16,000 that will
stay in the budget. Mr. Doluisio confirmed that the administration is proposing
that. Director Amato asked what the $42,000 is for. Mr. Majewski directed
Director Amato to pages 107 and 108. Page 108 shows the detail of how the
athletic budget will be spent as it is budgeted. Cuts in expenditures will come
off of page 108, the expenditure side of the budget. If you then look at page
107, we consider that there are gate receipts, season tickets, as well as $1,000
for TV and radio rights. What is left is what the district contributes to the
athletic budget. The remaining $40,000 is just the amount the district needs to
contribute in order to be able to make the athletic budget whole. Mr. Majewski
stated that the benefits/retirement contribution will also be reduced because it
was calculated using the higher rate.
Director Craig asked what item number 840 is on page 81, curriculum initiatives.
Mr. Doluisio stated that this item is listed every year. There is no increase to
the superintendent's budget. Mr. Majewski has advised that the money be spread
out into those categories. Mr. Majewski stated that this account has been cut
because there have been less expenditures. Mr. Doluisio stated that the
superintendent's budget is an eclectic budget. The conference account is a
series of conference accounts which is listed under the superintendent's budget.
Director Craig asked about the change of $40,000 in testing on page 84. Dr.
Nelson replied that three grade levels were added to testing. Grade four was
added to get additional information for placement into the academy. Grades six
and seven were added to get additional information on student performance.
Director Craig asked for an explanation of what student transportation is on page
85. Mr. Majewski stated that the majority of the approximate $380,000 is for
payment to the Intermediate Unit for transportation of special needs students,
the majority of that being for early intervention students. The remaining
portion of that budget will be for contracted transportation. There has been a
significant increase on the cost of contracted transportation for special ed
students. These are students that are outside of our district that we need to
contract with other parties to transport.
Director Craig stated that, in reviewing the budget, there are a lot of areas
where there is no increase and even where monies are less than a year ago. He
commended the administration. However, he did make a list of amounts he thinks
should be reviewed. The administration will respond to these at the next
meeting:
¥ Page 19 - 610 General Supplies
¥ Page 22 - Reduce the increase of $17,000 by $10,000.
¥ Page 30 - 590 Increase of $9,500 in Miscellaneous Purchased Services
¥ Page 33 - Items 430 and 440 - Eliminate the $6,382 increase.
¥ Page 46 - Increase of $7,422
¥ Page 79 - Items 580 and 610 - Reduce the increase of $21,500 by $15,000.
¥ Page 83 - Item 610 - Cut the general supplies increase of $80,000 by at
least $20,000 if possible.
¥ Page 85 - Item 610 - General supplies increased from $190,915 to $206,000.
Reduce this by $15,000.
¥ Page 56 - Item 330 - Other Professional Services. Reduce by least $10,000.
Director Craig stated that the total of these items would amount to about a
$125,000 savings. Adding that to the athletic savings of $33,378 totals almost
$155,000 in savings.
Director Koch wished to revisit the subject of the Bethlehem Steel taxes.
Regarding the $900,000 real estate tax, her understanding is that taxes get put
onto the property and when that property is sold, that is reclaimable. Mr.
Majewski stated that this is true. However, he has been told by Bethlehem
Steel's attorneys that an exemption for the current year only was built into
their bankruptcy. Mr. Doluisio stated that the district would verify and
validate what their attorneys have stated.
Director Koch remarked that in the past she has suggested and the administration
has followed-up by listing items that might be cut by a total of a million
dollars without jeopardizing the instructional programs. Mr. Doluisio stated he
is familiar with the past format and that the administration would be happy to
comply with her request except the caveat she put on the end "that would not
affect educational programs." It is impossible to comply with that. Director
Koch suggested listing possible cuts having the "least amount of impact on our
educational programs." The administration will try to provide a list of
reductions. Mr. Doluisio stated that to cut a million dollars, we would have to
cut people. Director Amato thinks it behooves the board and administration to
look very strongly at the budget. The proposed increase is close to 10% over
last year. The CPI index went up 2.6%. The millage increase is greater than the
CPI. Director Amato stated that Mr. Majewski also pointed to a slow down in the
local economy, the environment of the local economy in which there is a large
number of employers that have scaled back creating unemployment among taxpayers.
Director Amato thinks it is the board's duty to take a hard look at this budget,
that has an increase of almost 10%. He cannot believe out of eleven point some
million dollars we cannot come up with a million and a half or more dollars
without affecting the programs we have in place. Mr. Doluisio replied that he
agrees it is our duty to scrutinize this budget and cut wherever possible. He is
pretty sure we cannot do that without affecting programs, but the administration
will study it.
Director Amato stated that 23.4 positions are being added and asked how many
total teachers are part of the new Regional Academic Academy. Mrs. Kostem stated
that there are 13 total teachers, but they are not all in this budget. Only five
positions have been added to the general fund budget. Five positions are
expected to be taken from a federal source called "class size reduction
initiative." She was informed earlier this week that the district will, in
almost all certainty, be receiving that money and even more in that category than
was received this year. The additional three positions she is estimating will be
reallocated from the building that she has presently allocated staff to when we
know from which building the students will come. If enough come from a single
school, her assumption is we will be able to move three positions to the academy
because that is where the students will be. There are only five teachers for the
academy included in this budget.
Director Amato asked if this academy could operate on the eight positions that
are not part of the budget. His second question, if the answer to his first
question is no, is if there is a program that is in place now that is not paying
its way that should be considered for reducing or eliminating, and moving that
staffing into the academy which we feel is a top priority at this time. If that
can't be done, he asked if the academy could operate during its first year in
existence with eight teachers versus 13 teachers. Director Amato also wanted
charter school enrollment to be monitored closely for the possibility of teacher
reductions.
Director Venanzi asked if there are figures on teachers who are retiring. It
impacts the budget when teachers retire from top levels of teacher pay. Mrs.
Kostem stated she cannot tell her any positive news on that. At this point, 20
teachers have signed up to retire. Mr. Majewski has reflected this in the
budget.
Director Leeson agreed that this is a tough budget year. In a tough
budget year items must be prioritized. As much as she appreciates conferences as
being worthwhile, she wonders if the district could take them out of the budget
this year as much as possible. She believes this is a "bonus" area.
Director Heske referred to Student Allocations on page 117, stating the district
has maintained this same rate for a long time. He doesn't think it would be
unrealistic to cut every single one by one percent. That would spread the
opportunity to save a little bit of money here or there.
President Williams stated that if we are looking at doing some of these things,
the board needs to lead by example. Perhaps board conference and travel should
be studied, which comes to around $10,000 or $12,000.
Director Craig stated that President Williams has a very good point. However,
the board must be careful. His total point is to "hold the line." He does not
think it is wise to eliminate anything totally.
Director Koch stated that in the board policy one out of state conference per
year is allowed for each board member and unlimited numbers of attendance in
state. Certainly, you want to keep abreast of what is happening in the country.
However, more important is what is going on in the state. She stated she attends
a lot of conferences having to do with the PSBA and believes it is extremely
important for us. The board gets a lot of educational value out of these
conferences. She will fight it if the elimination of PSBA conferences is
proposed. She would encourage every one of our board members to attend every one
of their conferences in the state because they are so important to us.
Director Leeson wanted to clarify her comments on this subject. She thinks that
every teacher and staff member would be able to say the same thing Director Koch
stated about their experiences at conferences. It is not a question about how
worthwhile they area. She stated she understands Director Craig's position of
holding the line and not increasing. She is asking to go further than just
holding the line. She is asking to cut into, but to look at things with a very
critical eye. At some PSBA conferences where one or two members go, they could
bring back some of the information for us. Again, she is talking about a
one-year moratorium on conferences, not getting rid of conferences forever.
Director Heske stated, "A good budget is one where everyone feels some pain."
Director Amato asked Mr. Majewski on page 17, program code AA, what 330 other
professional services were. Mr. Majewski stated these were legal expenses and
auditing expenses.
On page 18, Director Amato, questioned on budgetary reserve, $381,707 was put in
the budgetary reserve which we did not have in 2000-01 and 2001-02. He asked, if
we did, why there are zeroes there. Mr. Majewski stated this is done every year.
There is money put into the budgetary reserve and then it is transferred into
other accounts. This is not an area where we charge expenditures. This is a
"budget only" category. Mrs. Kostem explained that when she comes to the board
throughout the year, asking to have additional teachers added, those teachers are
budgeted in budgetary reserve. Some teacher positions are placed in here in
anticipation that staffing may need to change. The amount is moved from here
into the teacher line item when the board authorizes movement of those funds.
Director Amato asked what the actual budgetary reserve movement was for the last
two budgets. Mr. Majewski stated that normal budgetary reserve that is budgeted
annually is about $400,000, sometimes higher. He will supply a history of the
budgetary reserve for the last two years.
Director Amato asked if there are any other areas for revenues, without going
after the home owners, that could be utilized for future budgets. Should we be
looking at other means of revenue stream to the school district other than the
real estate tax and should we plan to implement it in in year '03 or '04? Mr.
Majewski replied that there are very few authorizing laws the school district can
use to add taxes. At present, there is not one tax available that the district
is not using. Those that we may have had in prior years, the state has seen fit
to eliminate and only allow them to be used by those that previously used them.
Examples would be amusement taxes or occupational assessments. If a district had
them, they are allowed to maintain them. If not, you cannot add them.
Director Amato referred to Intersystem Payments on page 53 GF. He asked what 320
Educational Services - Professional is. Mr. Majewski stated that it is
Intermediate Unit payments. About $200,000 would be for contracted instructional
services. The rest would be for Intermediate Unit payments. The breakdown of
Intersystem Payments is on page 54.
Director Heske asked if the district can expect to recover some money from
insurance claims at Freemansburg. Mr. Majewski replied that he is optimistic
that we will. A complaint has been filed in Northampton County Court. It would
have no impact on this budget. It is a balance sheet item right now, saying that
we spent $1,500,000 and we expect to recover $1,500,000. Therefore, it cannot be
looked at as a revenue for the general fund budget.
Director Heske stated it seems that there are a few other things the state might
help the district with. He is aware that when they gave $40,000,000 extra to the
Philadelphia Schools, our state legislator put in an amendment to divide that
$40,000,000 amongst all of the 501 school districts rather than all the money
going to Philadelphia. Mr. Majewski replied that he is aware that there is the
potential for the $75,000,000 - not $40,000,000 - that Philadelphia was scheduled
to receive to be distributed amongst the remaining 500 school districts. If that
occurred, he believes instead of receiving a one percent increase the district
can anticipate a 2.8% increase according to information being provided to him
now. The amount would be approximately $225,000 to $230,000.
Mr. Doluisio asked if we can anticipate anything from the rumor mill for special
education. Mr. Majewski stated typically special education has been something
that has been talked about, discussed, and in the end they would have seen fit to
provide additional funding for special education. He is more hopeful that we
will see some increase in special education than he is in receiving additional
funding in the basic instructional subsidy. Mr. Doluisio stated that before the
board approves a final budget in late June, the district could hear officially of
some additional revenue of approximately several hundred thousand dollars if all
goes well. Mr. Majewski stated that this is correct.
Director Venanzi commented to Director Heske's suggestion of reducing the per
student allocation that she can't casually take money away from something like
that. She cautioned that reductions will compound, being brought back next year
with more items needed next year.
Director Craig remarked that discussion of conferences has taken a lot of
discussion and that is good. During the 2001-2002 school year $203,875 was
budgeted for item 580. For next year $181,475, a decrease of about $22,000, was
budgeted. He stated that the decrease is commendable.
Director Leeson asked why drivers' education was going up by 9.28%. Mr. Majewski
stated that certain costs are included in that budget. The cost of teachers are
not charged to that driver education budget. It includes car rentals, gasoline,
car maintenance. Those have been removed. With the increases, the district is
replacing $250 times the number of anticipated students included in the
Intermediate Unit program. What you don't see is that the other teachers have
been removed. There is a total savings of about $180,000.
Mr. Doluisio reviewed the requests for the next budget hearing:
¥ Director Heske wants the administration to look at the charter school law
suit and have our attorney look at what is going on between the charter
school and Mosaica.
¥ Director Heske proposed a cut in the athletic budget of the three items that
the administration agrees with.
¥ Director Craig asked for pages 19, 22, 30, 33, 46, 79, 83, 85, 56 and the
various account codes within those pages and the athletic savings of over
$33,000. ¥ Director Koch asked if our attorneys could look into the
$900,000 of 2001-2002 Bethlehem Steel taxes.
¥ Director Koch asked for a list totaling approximately $1,000,000 of cuts in
a prioritized manner.
¥ Director Amato asked to examine every 610 line item.
¥ Director Amato wants to know if the Academic Academy can operate without the
5.0 additional teachers and if there are any existing programs not "paying
their way."
¥ Director Amato wants to know if there are any savings the district can yield
because of the charter school.
¥ Director Leeson wants conference accounts studied and, perhaps, a one-year
moratorium, after studying every one of them.
¥ Director Heske wants consideration of a cut of 1% on page 117.
¥ Director Williams wants board conferences studied and to follow any cuts
made to conferences in general.
¥ Director Amato wants more information on budgetary reserve for the 2001 and
2002 school years.
Mr. Doluisio stated that the administration will respond to the questions at the
next hearing.
COURTESY OF THE FLOOR TO VISITORS
No one wished to address the Board of School Directors.
ADJOURNMENT
Directors Craig and Heske moved to adjourn the meeting which carried by voice
vote. The meeting adjourned at 8:00 p.m.
Attest,
Stanley J. Majewski, Jr.
Board Secretary
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