Newfound School Board sees win-win in returning $1 million to taxpayers

BRISTOL — School administrators and the majority of the members of the Newfound Area School Board see their decision to return $1,069,556 to the taxpayers – while retaining $438,593 to cover unanticipated expenses – as a win-win for the district.

The million-dollar return more than covers the disputed $712,400 that the board included in the district’s default budget for the coming year. Taxpayers have threatened a lawsuit over that precedent-setting move in which administrators included money in the default budget that voters never appropriated, in order to cover facilities improvements identified in the board’s capital improvement program that was adopted without any vote by the public.

The Newfound Area School District had a year-end unexpended fund balance of $1.5 million, representing money that was appropriated for the last fiscal year but remained unspent because of higher revenues and lower expenditures than anticipated. Having adopted a state statute that allows the district to retain up to 2.5 percent of that balance to cover unexpected costs, the School Board was allowed to keep as much as $438,593 this year.

School Board members originally supported keeping the retained funds at about the same level as past years — $275,000 — and Superintendent Stacy Buckley said that would be “a safe amount” and allow the district to return more money to offset taxation.

Business Administrator Michael Limanni advocated for keeping the maximum allowed as a way to stabilize the tax rate. He said that, if the district receives lower revenues and has higher costs next year, it could lead to a huge tax increase that would seem even larger because of the reduced tax impact this year. Having a larger retained fund would allow the district to cover costs without increasing taxes, similar to the way municipalities operate, he said.

Vincent Paul Migliore of Bridgewater and Christine Davol of New Hampton said there was no reason to retain more than last year, since the district has never had to dip into the fund in the past, and especially because the current tax rate is elevated due to the decision two years ago to add $800,000 to the budget to replace the high school roof.

“It would be absolutely insane to keep $438,000 in additional dollars in the retained fund balance, which is [only] an option for us to consider,” said Migliore.

Davol said she wanted to avoid spikes in the tax rate from year to year, but she agreed with Migliore that stabilizing the tax rate at its current high level is the wrong thing to do, particularly at a time when the School Board is facing strong criticism for its decision on the default budget.

Sharon Klapyk of Danbury and Sue Cheney of Alexandria argued for withholding as much money as possible, rather than returning it to offset taxation.

Klapyk said, “I’m for the students,” adding, “I’m a planner. … We all have a savings account. We plan for emergencies in our own life, and we don’t have a budget of $22 million. I feel we have these numbers available, and that’s exactly what we should be doing.”

Cheney compared the retained fund to an insurance policy. “You hope you’ll never have to use it.”

Migliore said the highest unanticipated expense would likely be for special education, which might cost $100,000, so there was no need to set aside such a large amount. He warned of a voter backlash next year because of the high default budget, after voters had rejected the proposed budget in March.

Klapyk and Cheney dismissed those concerns, with Klapyk saying there was no way to know why residents voted as they did, and Cheney noting that many who would have voted in March stayed home because of the bad weather.

The final vote was 5-2 in favor of retaining the maximum amount possible. The remaining money will reduce the amount of the school district appropriation to the seven member towns — Alexandria, Bridgewater, Bristol, Danbury, Groton, Hebron, and New Hampton – when the Department of Revenue Administration sets the tax rate in October.