Q: How is the annual school budget proposal developed?
A: Developing a budget for a future school year is a year-round process. It typically begins in the fall with a review of the previous year’s expenditures and the educational priorities set by the Queensbury Board of Education over the summer. District administrators look at the cost of Queensbury educational programs, the success of those programs – as measured in state, national and district reports – and at how the programs align with the school board’s priorities. Over several months, school building administrators also work with their teachers and support staff to develop individual building budgets and to identify program spending areas that could be more efficient. They share that information with district administrators, who can then make projections for the following year based on historical data.
Other factors that have an effect on the annual school budget include increasing costs associated with meeting state and federal mandates, changes in state and federal aid, and economic trends that affect the local tax base. Contractual obligations – whether for employee bargaining units or service providers – are also taken into account and can be projected based on the commitments previously agreed upon. Other factors that come into play include enrollment data, changes in students’ interest in non-mandated programs and the calculation of the district’s tax levy limit. The tax levy limit sets the threshold for voter approval of the school budget, and it must be calculated and submitted to the state by March 1.
The superintendent presents a draft budget proposal to the school board in late January. The school board then revises the proposal over the next two to three months so that it best reflects their goals for the district and the community’s feedback on those goals. A final budget proposal is adopted in mid-April, and eligible district residents can vote on it in mid-May.
Click here to view an infographic (PDF) that presents a simple, step-by-step overview of the annual school budget development process.
Q: Does Queensbury use zero-based budgeting?
A: Queensbury does not engage in a practice known as zero-based budgeting, which would require all district programs to detail and explain every single potential purchase for the following year. While this process can sometimes help districts identify savings areas, it is an extensive undertaking that significantly increases both the time and the expense of preparing a budget. The district already engages in a lengthy and detailed budget development process that has helped identify numerous cost-saving areas. While zero-based budgeting may have value in the for-profit corporate world, it is a much less useful tool in the not-for-profit public education world because school budgets primarily consist of fixed expenses related to contractual obligations and state and federal mandates.
Q: What does the district do with any unspent funds at the end of the school year?
A: Any money left over at the end of the year, whether from spending less than originally budgeted for or from taking in additional revenue, is put into either an undesignated or an appropriated fund balance.
An appropriated fund balance may be applied to the budget for the following school year to reduce the amount of money that must be generated through school taxes. This can help stabilize school tax rates and prevent large jumps in years when other revenue sources, such as state aid, significantly decrease. For example, the district used nearly $3.8 million of appropriated fund balance and reserves in 2017-18 to reduce the increase in school taxes after ongoing reductions in state aid.
Any money left over after taking out the appropriated fund balance may be set aside in what is known as an undesignated or unappropriated fund balance. Schools are allowed to place an amount of up to 4 percent of the following year’s school budget in an undesignated fund balance. The money is used to:
- Cover district expenses even if it hasn’t yet received all of its revenue (e.g., from the state).
- Address emergency health and safety concerns (e.g., infrastructure problems such as a failed boiler or unsound wall).
- Prepare for unforeseen occurrences (e.g., higher than expected costs for heating fuel, gas/diesel fuel or snow removal; unanticipated substitute costs for maternity leaves or injured workers; increased enrollment of students with special needs).
- The status of a district’s fund balance, as well as its reserve funds, affects its bond rating. The better or healthier a fund balance, the less it costs a district to borrow money for things such as capital projects.
Q: Why does the school budget include money for reserve funds?
A: State law allows school districts to establish a variety of reserve, or restricted, funds. Each one of these reserves was established to prepare and pay for specific expenses anticipated in the future. The budget appropriation for each one cannot reasonably exceed anticipated expenses – meaning the district cannot hoard money in these accounts. Queensbury currently has five reserve funds:
- Unemployment insurance reserve – This reserve fund is used to pay the cost of reimbursement to the State Unemployment Insurance Fund for payments made to claimants.
- Insurance reserve – This reserve is used to pay liability, casualty and other types of losses.
- Tax certiorari reserve – This reserve is used to pay tax certiorari cases, which are court cases brought by businesses or property owners seeking a reduction in their property tax assessments.
- Reserve for employee benefit accrued liability – This reserve was established to pay for any accrued employee benefit due to an employee upon termination of the employee's service. School districts originally placed millions of dollars into EBALR accounts to abide by recommendations from the General Accounting Standards Board (GASB 45). The state later determined that the accounts could only be used to pay unused sick and vacation time when employees retire. In 2011, the state comptroller authorized districts to withdraw a certain amount from their EBALR accounts in order to offset increases in school taxes. Queensbury now has only enough it its EBALR account to cover its anticipated liabilities, in line with state guidance.
- Employee retirement system contribution reserve – This reserve is for employer contributions to the state Employee Retirement System, which covers most non-instructional school staff.
Having these reserves can eliminate or reduce the need to raise taxes and/or cut staff, programs and/or services in order to cover future expenses. The status of a district’s reserve funds, as well as its fund balance, also affects its bond rating. The better or healthier a district’s reserve funds, the less it costs the district to borrow money for things such as capital projects.
Q: What has the district done to control spending and contain costs?
A: The Queensbury Board of Education and administrators have achieved cost savings in several areas:
- Grants: The district secured more than $3 million in grants to help enhance and expand the educational program, through the addition of programs such as Early College Career Academy, International Baccalaureate and the high school innovation space, without increasing the school tax levy.
- Health and Dental Insurance: The district is a member of the WSWHE BOCES Health Consortium, which provides savings on health and dental insurance costs through the grouping of individual districts into one, large negotiating group. The school board also negotiated with the employees' unions to switch from a Matrix plan to a more cost-effective PPO plan and to increase employees’ health insurance premium contributions.
- Energy costs: Between 2009 and 2017, a comprehensive energy conservation and management program helped the district achieve savings of more than $2.5 million in reduced energy costs.
- Cloud Computing: The district uses virtual host servers, instead of physical servers, for school software and data at a savings of $401,565 over five years.
- Purchasing Practices: The district competitively purchases goods and services in accordance with state law and Board of Education policy #6700. Purchase contracts for materials, equipment and supplies involving an estimated annual expenditure exceeding $20,000 and public work contracts involving an expenditure of more than $35,000 are awarded only after responsible bids have been received.
- Transportation: The district achieved savings through the consolidation of its maintenance and transportation facilities. It also sends buses on three separate pick-up/drop-off runs so fewer total buses are required.
- Paperless Communication: Queensbury uses digital communication methods whenever appropriate as a way to save money. For example, district and school news is most frequently distributed online via websites, videos, email, social media (e.g., Facebook, Twitter, Instagram) and a district app for mobile devices.
Q: Has the district reviewed the number of field trips scheduled and their educational value?
A: The district reviews field trips for efficiency, effectiveness and educational value. The manner in which they are conducted is also regularly evaluated. For example, some field trips that have historically been off site could be brought on site – through technology or campus visitors – and still provide the same educational advantages. Of course some trips require off-site experiences in order for children to receive the full educational value.
Q: What has the district done to reduce staffing costs?
A: Between 2009-10 and 2018-19, the district will have reduced more than 95 staff positions to reflect declining enrollment as well as fiscal pressures. Those reductions were made mainly through attrition, which happens when employees retire and their vacated positions are not filled. In 2018-19, health insurance costs also will remain flat due to negotiated savings from increased employee contribution rates and a lower-cost base health insurance plan. The school board also previously negotiated with the employees' unions to switch from a Matrix plan to a more cost-effective PPO plan. The district continues to monitor and evaluate staffing levels for opportunities to increase efficiency and find savings.
Q: What are the ways that the district can raise revenue? Can the district institute a pay-as-you-go system for co-curricular and extracurricular activities?
A: Queensbury Union Free School District is currently able to raise revenue by collecting aid from the state and federal governments, collecting taxes from local property owners and charging rental fees for its facilities. School board policy currently does not allow large-scale corporate sponsorships, which some districts have used to raise revenue. In New York, it is illegal to require students to pay to participate in school-based activities such as sports teams and music groups, often known as ‘pay to play.’
Q: How much of the budget is just to cover state mandates?
A: Queensbury Union Free School District has not conducted a formal study to determine how much it spends meeting state and federal mandates, but the majority of district expenditures are either directly or indirectly related to meeting mandates. For example, consider the state mandate requiring schools to provide academic intervention services to students who struggle to meet certain educational benchmarks. One direct cost of that mandate is the cost to employ an AIS teacher. Some indirect costs of that mandate might include: an assessment tool to diagnose a student’s deficiency; staff time to analyze the assessment results, come up with strategies to address the deficiency and monitor the student’s progress; a database to track the student’s performance; and more staff time to manage the database.
In 1991, the state Education Department estimated as much as 76 percent of a typical school district expenditure is a result of directly or indirectly mandated matters. Several lower Hudson Valley school districts spent hundreds of hours determining that 15 to 30 percent of their school budgets were directly spent just on state mandates in the 2008-09 school year. In the Westchester and Putnam counties, seven districts worked together to determine that they spent on average 21 percent of their budgets directly related to complying with state and federal mandates.
Q: How do state pension system contributions affect the school budget?
A: All employees of the school district, whether part-time or full-time, are permitted to join the New York State retirement system. The Employees’ Retirement System (ERS) covers non-instructional school district employees such as bus drivers, maintenance workers, secretaries, and food service staff members. The Teachers’ Retirement System (TRS) covers instructional school district employees.
Both the ERS and TRS systems are funded by a combination of stock market investments, employer contributions and employee contributions. These rates are statutorily established by the state and are not under the district’s control. In other words, the district must pay whatever the state says it must pay.