SOUTH PORTLAND — In what may be the last workshop session before the school budget referendum, the School Board met with city councilors Monday night and outlined four problematic aspects of the budget.
Despite the issues, however, the board has proposed a budget of approximately $46 million, an increase of about 3.5 percent, which is below the 5 percent growth cap requested by the City Council.
Superintendent of Schools Suzanne Godin said the budget surplus, the district’s aging bus fleet, and the maintenance and technology budgets are four areas “we continue to have major concerns with in our budget.”
The district’s surplus, which is expected to shrink from nearly $1.8 million at the beginning of fiscal year 2015 to a projected $1.1 million at the end of this school year, is estimated to continue to decline next year, to a projected $614,000.
The surplus was more than $4 million at the beginning of the district’s seven-year plan in 2011. Approaching the end of that plan, funds will have dwindled to an uncomfortably low figure, Godin said, which is affecting other areas of the comprehensive budget, including maintenance.
“The rule of thumb is about a 3 percent surplus, so you can see that in a $45-$46 million budget, we’re getting below that 3 percent,” Godin said. The board is concerned with “what’s going to be left at the end of the day for protection,” she added.
“We’re at the point where over the next couple of years, we could be at a detrimental position,” Godin said.
The district’s school bus reserve account is also dwindling.
Last March, the average age of the 22 operating buses was about 9 years, with average mileage of a little more than 108,000 miles. The disproportion of age to mileage is, to a degree, unavoidable; South Portland is not a large community, geographically, Godin said.
“South Portland doesn’t put enough mileage on their buses on a regular basis to qualify for reimbursement from the state,” Godin said.
A district can qualify for state aid if a bus is at least 10 years old and has been driven more than 150,000 miles. Many of the School Department’s buses are older than 10, but lack the mileage that would otherwise qualify for supplemental funds, Godin said.
The district has significant issues with 10 of the 22 buses, Godin said. The cost of one bus is $85,000-$95,000.
“One of our issues is that we have had a bus reserve to help us offset cost of bus replacement,” Godin said. But that reserve, too, is shrinking.
In other words, Godin said, bus mileage is low, “but we have a number of buses that are in dire straights.”
The depletion of the year-to-year maintenance reserve is exacerbated by the number of buildings to maintain in the district, Godin said.
“We have eight buildings plus a transportation garage,” but the actual maintenance budget, year to year, is “extremely minimal,” Godin told councilors. The district has historically relied on reserve funds to subsidize the maintenance portion of the budget, but that relationship is becoming more precarious as the reserve funds are “drying up,” Godin said.
At least twice throughout the workshop Godin told councilors the School Department could save $750,000-$1 million in annual expenses if schools are consolidated, specifically Mahoney and Memorial middle schools.
The department is slated to examine the possibility of consolidating Memorial and Mahoney middle schools through an ad hoc middle school building committee, whose members will be selected May 11.
Most of the significant maintenance needs are at the middle schools.
“We’re in this position, similar to where we were as we were moving toward preparing for our high school renovation, (with) not wanting to do anything that would get paid for and then be undone within the next three to five years,” Godin said.
Health and safety issues will be dealt with immediately, she said, but the remaining issues that are not as critical might be delayed until a middle school project is determined.
The annual expenditure of about approximately $200,000 to lease iPads for South Portland High School students has also been funded, historically, through the district’s reserve.
With the technology fund expected to be running a deficit by the end of fiscal 2017, Godin expressed a desire to transition away from relying on reserve funds.
“We’re again concerned that that’s not a healthy way of doing it and looking for the need to bring it into the local budget,” she said.
Councilors, who generally lauded the School Board’s work, are scheduled to vote on the budget on May 18. The public budget referendum is on June 9.