Exeter Region Cooperative School Board Budget Work Session Minutes
Saturday, January 7, 2006 – 8:00 AM
Seacoast School of Technology – Culinary Arts Dining Room
PRESENT: Patty Lovejoy, Greg Kann, Lucy Cushman, Sally Oxnard, Robin Scott, Kim Casey and Kris Magnus son
ABSENT: Roy Morrisette and Ray Trueman
ADMINISTRATION: Arthur Hanson, Walter Pierce, Nathan Lunney, Vic Sokul, Tom O’Malley, Richard Wendell and Pat Dowey
1. CALL TO ORDER/PLEDGE OF ALLEGIANCE: Chair Lovejoy opened the meeting at 8:25 PM followed by the Pledge of Allegiance.
2. ANNOUNCEMENTS/PUBLIC INPUT: Gentlemen in audience asked for permission to tape the meeting.
3. OVERVIEW OF THE DAY
A. Timeline & Guidelines for the Day – Patty Lovejoy: Reviewed the day’s agenda.
B. Overview of the FY 2007 Budget – Skip Hanson: Superintendent gave background on how the budget was put together this year explaining that the board gave a percentage increase, which they asked the administrators to bring forward and this year was 4% or less. Principals have pared down their budgets to get them to 4% or less and board does have the right to reduce the budgets even further. Victor Sokul, Tom O’Malley, Pat Dowey and Dick Wendell are here to answer any questions you may have. Greg added that the 4% was for the non-staff portion of the building budget and we have flat funded the remainder of the budget as the board has done for the last couple of years.
4. LINDEN STREET RE-USE UPDATE
A. Squamscott Community Commons (SCC) – Carol Aten/Don Briselden: Carol explained since they did a full presentation to the board last July, she would not be repeating that effort. She read her citizens petition warrant article they have submitted: Shall the District authorize the School board to convey the real estate situated at 56 Linden Street, Exeter, NH (old Exeter AREA Junior High Land/Building Tax Map 82, Lot 13) to Squamscott Community Commons for use as a community center for Two Hundred and Fifty Thousand Dollars ($250,000) and on such terms and conditions as the School Board may determine?” Carol also explained that she has been working with Walter on his traffic assessments and a transition plan into the Annex if they are successful with their article and she is present to answer any questions. Discussion followed on the amount they are offering for the Annex. Kris asked if the board got a full appraisal or a limited use appraisal done. Carol noted through their appraisal of the property, the SCC had determined the fair market value for the property to be zero since the demolition costs exceed the value of the building. There was further discussion on the assessment of the property and the background that the Linden Street Re-Use Committee had done. Lucy explained that the appraised property carried a value of $750,000, but the cost for the abatement and demolition of the Annex building was $1 million. She further explained that Walter did advertise heavily this fall in various trade publications that the property was for sale and there were some interested individuals looking for development of units to put on site, but when they met with Walter and talked to Exeter Planning office, they were not interested because they could not get enough units on the property to make it viable. Motion by Kris Magnusson, seconded by Sally Oxnard, to have the board hire a qualified appraiser to conduct a comprehensive appraisal on the specific Linden Street Annex parcel that we are considering for disposition for highest and best use including on-going use of building. Further discussion followed noting that the appraisals that were done did not take into consideration the removal of the existing building since that is not part of the appraisals’ requirement. Walter spoke to what the intent of the Squamscott Community Commons is and that this is not a school board iniative, but a citizens petition warrant article that will be decided by the voters. Walter spoke to his latest conversation with Brian White regarding having an updated appraisal and that you could not get a comparable value with regard to using the Annex as an existing school since school values are all over the place. The Re-Use Committee decided on using an appraisal that was a limited use appraisal to maximize the value per the board’s agreement. Walter has been talking to planning office in last two weeks and there is no incentive or mood by that office to do any zoning restrictions or changes to this property that would concur with age restricted housing like what was done at Sterling Hill off Guinea Road. The appraisal that looked at utilizing the existing Annex building and would allow more units came in lower than the appraisal of demolishing the building and putting in single family units. Kris noted that she asked in July for an updated appraisal and is just following up with that request and feels the board is doing this proposal a disservice if we do not know what the current appraisal is. Kim noted that she is upset with the implication that by voting against this motion, she would be viewed as someone who is not concerned with the taxpayers’ dollars. At this late date, Kris’s request makes it seem that the board has not done our homework nor has the SCC has done their due diligence. Jim Johnson – Brentwood asked about this building being used to house the SAU Preschool that was discussed at a recent Brentwood Board meeting. The board and Pat Dowey clarified for Jim that the Annex location was never considered as a possible location for a SAU Preschool, if that should come about. Greg shared that that the quality of the appraisal is trumped on whether you can sell the appraisal or not and it has been marketed for over a year ad a half with little or no response. Chair asked if there were no further discussion, she would like to call for a vote. Vote: One (1) in favor (Magnusson) of motion and six (6) against; motion failed. Patty noted the board will vote on whether or not the board supports this after the Public Hearing next Thursday, January 12, 2006.
B. Disposition of Annex - Lucy/Walter: See agenda item C.
C. Future Occupancy Plan of Old HS Site – Walter: Walter gave a handout regarding this timeline (see Attachment #1 pdf). Lucy spoke that we are now looking at a year plan since this summer the emphasis will be on getting transitioned from the existing EHS to the new location. Regardless of what happens with SCC warrant article, we will hold onto the Annex for the school year 2006-07. Since the technical equipment used at the Great Bay eLearning Charter School is the basis of their curriculum and was purchased to be totally portable, is one of the reasons we need time to relocate entities currently in the Annex to a new location at the old EHS site.
Water reviewed his handout and shared the limited use of the Tuck space due to the choppiness of the rooms and renovations that would be required. There are four possible tenants for the Tuck that Walter has met with and they know they would be responsible for the lease hold improvements. We would open up that space to them as soon as the building is vacated by the existing staff. If SCC does prevail, they would need a small office in the Annex, as they would need a full year of fundraising, etc. before they would take possession of the Annex and this would work well for our use of the Annex in 2006-07. Dick Wendell and the Maintenance Department would remain in the basement of the Tuck. Question on expansion ability for SST and it was explained it would occur in a couple of years, but would not go into the old high school, but on the site they currently have. SST is in the process of getting approval this winter or spring for that funding and the work would be done a couple of years out. Seventy five percent of the renovation costs for SST are reimbursed by the state.
5. CONTRACT WITH EXETER COOPERATIVE PARAPROFESSIONAL ASSOCIATION – APPROVAL - Patty: Patty reported that the paraprofessional negotiations have come to an agreement and that the paraprofessionals will be voting on this contract on Monday, January 9, 2006. She reviewed the terms of the agreement (see Attachment #2 pdf). She reviewed the terms of the agreement. Patty would call for motion to accept this contract. Motion by Robin Scott, seconded by Sally Oxnard to accept the terms of the ERCSD Contract with Exeter Cooperative Paraprofessional Association per Attachment #2. Discussion – question from audience on what are the requirements to be a special education aide to which Pat Dowey responded. Also had question on what we are currently paying with regard to health insurance to which Patty responded. No further discussion. Vote: 7-0 all in favor with no opposition. Patty shared that Ray Trueman was involved with all the para negotiations and supports this contract, as well as Roy Morrisette who was unable to attend, but was updated on these conditions and noted his approval. Kim acknowledged all Patty’s work on this and thanked her on behalf of the board.
6. TAX IMPACT OF FY 2007 BUDGET – Nathan Lunney: Nathan gave out the following handouts and led the board through a review of the various components of the proposed budget for fiscal year 2006-07. He directed the board to the Requested Budget 2006-07 handout in gray that was used as a master to which the following documents were reviewed and connected:
· Annual Meeting Timeline (white sheet) – Attachment #3 pdf
· ERCSD Budget Summary Requested Budget 2006-07 (gray) – Attachment #4 pdf: Nathan explained all items on this sheet, beginning first with the “default” budget items
· Salary Analysis FY 2005-06 – Budget Development FY 2006-07 (goldenrod) – Attachments #5A pdf & #5B pdf; noted paraprofessional contract implications to follow
· ERCSD Other Insurance Schedule (white) – Attachment #6 pdf - issued insurance schedule, and
· ERCSD Debt Service Schedule (white) – Attachment #7 pdf debt service schedule (#4).
· In non-salary accounts (back to grey sheet) of the 1.7 million budget, 1.4 million comes from CMS and EHS – includes PE equipment, paper, copiers, PO’s, legal costs, all textbooks, arts supplies, everything consumed by principals, guidance and nurses, etc.
· ERCSD Transportation (yellow) – Attachment #8 pdf - discussed the current and continuing extension (6th year) of the First Student contract; talked about the possibility of sharing some bus time with Hampton Falls going forward as it needs to be finalized by First Student and agreed to by SAU 16 and 21; also discussed separating students going to CMS and EHS from being on same bus.
· ERCSD SPED Budget FY 2006-07 – 12/20/05 (tan sheet) – Attachment #9 pdf - spoke to two components that make up budget (non-salary items and out-of-district tuition related costs) – student IEP’s for all students in district and incoming (5th grade and below, referrals, new students, etc.) IEP’s as it is the most moving target in the process; contracted services include all of those services such as deaf education, interpreters, etc.; explanation of Youth Adult Transition (YAT); and the catastrophic aid for students both in and out of district that we apply for.
· ERCSD – Benefits Proposed Budget FY 2006-07 Dec 29, 2005 (cream) - Attachment #10 pdf – this year the “not to exceed rate” was 18.6% on health; 4.2% on dental; and the budget is done looking at each person and the multi plans we have; we anticipate a surplus in current year’s budget, so we budgeted for a little less than 18.6%; reviewed dental, life, worker’s comp, retirement (driven by salaries), step increases (grade increases), FICA, unemployment (driven by staffing levels) and professional study benefits (the entitlement teachers have in their contract for courses/credits).
· SAU Assessment (white) – Attachment #11 pdf - is part of our budget and is in the default budget; board cannot change this figure.
· Maintenance Budget Outline 2006-2007 (bright pink) – Attachment #12 pdf – reviewed the cost drivers in this budget: salary is the biggest contributor, benefits are a big cost driver and utilities are again this year a significant driver. Net impact of opening the new building and its impact on salaries and utilities are big initiatives. The salary items are in regular salary budget and discussed the operating budget for maintenance – utilities are: water, sewer, electricity, fuel, oil, natural gas. Walked through budget. Travel reimbursement – IRS rate up 26.5% since initially budgeted for, along with number of maintenance staff is growing; question is CMS and EHS recycle and response was that EHS does recycle plastic (CMS paper only), but it costs more to get rid of recycled goods and this is reflected; cleaning includes cleaning old EHS when it is more or less vacated; electricity – hoping to reduce old EHS site by 25% and possibly more – single most cost driver in this budget and maybe the entire budget; mosquito spraying plan will be presented to SAU Joint Board Chairs in February 2006; furniture line, no new costs for new HS;
· ERCSD Budget Requests Beyond Default Budget (purple) – Attachment #13 pdf issued budget requests beyond default budget for professional and non- professional staff;
· ERCSD Account Summary of Trust Funds November 30, 2005 (white) – Attachment #14 pdf issued
· ERCSD Budget Summary Proposed Budget 2006-2007 (blue) – Attachment #15 pdf - this sheet has taken $400,000 out of budget (SPED by $150,000 and maintenance by $150,000 and utilities by $100,000); board discussed what their positions were concerning this amount of money from the budget; noted that the board needs to vote today for final total appropriations number for the public hearing on the budget on next Thursday.
· January 7, 2006 School Board budget Workshop Draft Warrant ERCSD (white) – Attachment #16 pdf - passed out proposed warrant articles #1-#7 and reviewed.
· Budget Summary (salmon) – Attachment #17 pdf (5 pages) – this is based on the Attachment #15 with the $400,000 removed from the budget
· Budget Summary (yellow) – Attachment #18 pdf (2 pages) – this is excerpted from #17 above and presents the tax impact if the $400,000 was not removed.
· ERCSD FY 2006-07 Revenue Projection (green) – Attachment #19 pdf - this is revenues; MS 26 documents what budget is made of (program by program), as well as anticipated revenues.
Motion by Kim Casey, seconded by Robin Scott and unanimously board voted with no further discussion to have an appropriations budget of $43,565,480 and a default budget of $43,248,367.
· ERCSD Proposed Budget Fiscal Year 2006-2007 (tan) – Attachment #20 pdf handed out
· ERCSD Default Budget Details for FY 2006-07 (pink) – Attachment #21 pdf handed out.
Greg would like to have a sheet that shows what the cost of the new high school costs are, i.e., how much this increase is due to the larger size of the new high school and Nathan will try to pull something together for Greg to have.
7. WARRANT ARTICLE(S) – Walter, Nathan, Skip: Nathan explained that the board does not need to approve the warrant articles (Attachment #16 pdf) until Thursday, January 12th at the board meeting after the Public Hearing. Warrant Article (WA) #4 gives the board the authority to convey (lease or sale) the Annex whether WA #5 passes or not. We will review the remaining WA at Thursday’s meeting. Patty issued another proposed warrant article (see Attachment #22 pdf) that will become WA #4 and the current WA #4 & #5 will become WA #5 & #6. Patty read article and explained that the amount to be earned on investment of bond postings for the new high school will be around $1.5 million. Because of higher interest rates, we have earned more than the $500,000 anticipated and this warrant article is asking taxpayers to allow us to spend part of that extra money earned (up to $800,000 for completion of EHS) and if do not need all that money to complete new high school, we will return remainder to taxpayers. The remainder of the interest money, if voter approved, would go into the capital interest trust for possible future use of our portion of SST renovation costs, addition at CMS, etc. The $800,000 can be used for any purpose of completing EHS. Walter explained he is still working with state to put a traffic light on Rt. 27 at the entrance to the new high school, which would cost up to $150,000. Feels it would be prudent to have these monies available if needed to complete the project. Kris stated that she does not recall any discussion about this warrant article at the last Finance Committee meeting and that she asked if any warrant articles were coming forward and Walter said no, so she is shocked. She feels this money could be used to reduce tax rates in the towns. Patty explained that this warrant article did not go through the Finance Committee and could come forward next year, but she decided, given some of the items that may not be completed at new high school, to bring it forward this year. She reminded Kris that all capital reserve funds have these same discussions about how they could be returned to the towns. Have earned approximately 1.6 million in interest on the bonds. Kris thinks only $150,000 of the interest earned should go to possible traffic light needed and rest go back to taxpayers. Patty discussed items at the new high school where this money could be used to complete some projects: buildings under stadium; courtyard outside cafeteria for gathering; potentially outdoor classroom area. Discussion followed on how we have been able to do more on the project than we thought we would with our budget; it is often more cost effective to do additional projects when you have the workmen on site versus calling them in at a later date; and that as projects go forward, you discover additional items that would be great if you could do them as they were not in the original budget. Patty again noted that this warrant article is asking for up to $800,000 for completion of new high school with any monies not used for new high school would go back to taxpayers and asking for up to another $800,000 to go into a capital reserve fund. Kris noted that she does not feel this is prudent to do and does not support. This will be a proposed warrant article to be voted on Thursday night.
8. SUPERINTENDENT’S REPORT
A. New High School Update: Kris asked about status of contingency fund and Walter noted we have about $100,000 in fund. Tuesday, will be walk through at 7:30 AM and Facilities will meet at 6:00 PM before Thursday Budget Hearing at 7:00 PM.
9. COMMITTEE REPORTS: None at this time.
10. NON-PUBLIC SESSION – Lucy noted we need a non-public under d. Motion by Lucy second by Robin to go into non-public at 2:05 PM with everyone voting in the affirmative. Arthur Baillargeon thanked Nathan for his excellent presentation today.
11. ADJOURNMENT: Motion by Robin Scott, seconded by Sally Oxnard and unanimously board voted with no discussion or opposition to adjourn at 2:15 PM.