The West Seneca Central School District has watched a fund balance of about $20 million disappear over the last several years.
In 2013-14, there will not be enough left to rescue programs, maintain current class sizes or avoid staffing reductions. It's a predicament that many area school districts have already been forced to face because of reduced state aid.
In West Seneca, school officials and the public received the dire news at a regular School Board meeting Monday night from auditors and the district's financial team.
"We did what the governor asked us to do – continue programming and use fund balance. This is the result," said Brian L. Schulz, district treasurer. "We got no mandate relief, and there are more mandates coming."
An exasperated Schulz made the remarks during a presentation by Matthew J. Montalbo, manager of a third-party independent auditing firm, Drescher & Malecki of Cheektowaga, who told the board and district officials what they already knew: The school's "rainy day fund" has run dry.
"We've been attempting to keep the wolf at bay and not go over the cliff," School Superintendent Mark J. Crawford said, explaining that West Seneca lost about $18 million in state aid over the last three years alone.
"We will experience next year, for the first time, some serious cutbacks," Crawford said about projections for 2013-14. "We are sick about it."
District officials say they took Gov. Andrew M. Cuomo's advice to save educational programming and staff positions by dipping into what once was a fund balance of about $20 million, including $5 million in 2010-11, $3.8 million in 2011-12 and $3.3 million to balance its books this year.
West Seneca has a restricted fund balance of $7.7 million, but much of that must be preserved for employee benefits and insurance. As a result, the district unappropriated "savings account" been depleted to $499,000. "For a $108 million budget, that's not a lot," Montalbo told board members.
At the end of September, the district's total bank account had dipped to $242,000, with payroll looming. The district narrowly avoided having to borrow money, thanks to an influx of $40 million that was received over the last week from collected school tax and state-allocated lottery monies.
Still, it shouldn't be that close in a district that has a history of success in keeping its financial house in order, officials said. Now it's faced with either drastic cuts to fill a projected $7 million shortfall for 2013-14 or a significant school tax increase.
And, with the property tax cap now in place, a supermajority vote by taxpayers would be required to eclipse that.
"These are not choices we would make if we were provided the resources that we had committed to us by the State of New York 10 years ago," Schulz said.
Montalbo told school officials that state aid reductions, combined with ever-increasing costs in teachers' and staff members' salaries, pensions and benefits, is making it "impossible to keep up with costs."
For instance, he said, the district allocated $3.1 million to the teachers retirement fund in 2010. That ballooned to $4.8 million by 2012. Additional increases are expected this year, with even more on top of that by 2013-14.
"There is a significant gap out there for '13-14," Montalbo said.
Added Schulz: "We can't fill the gap anymore."
Although the school budgetary process is still months away from really getting rolling, district officials are already plotting their strategy.
Among the first items the district will do is gauge interest among teachers and staff in retirements or resignations to take effect at the end of this school year. They hope to have some picture about that by Jan. 1, 2013, Crawford said.
From there, the district will have a clearer idea what it will take – whether by programming alterations, reduced class sizes or staffing cuts – in order to draw up a budget for the 2013-14 school year.
By the end of January and February, Schulz said, district officials and the board will begin crunching hard numbers for the 2013-14 budget, with public sessions expected to be held in late February.