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KELLY URGES HIKE IN TAXES TO GIVE SCHOOLS MORE AID $10 MILLION INCREASE FAVORED TO MEET EDUCATIONAL NEEDS

Board of Education President David B. Kelly said Friday the city should raise taxes to give the Buffalo Public Schools more money, possibly as much as $10 million more.

Kelly last year was part of an effort to force the schools to operate at a reduced funding level set by the city.

He favors a tax increase because he believes it is the only way to meet school needs during the next decade without taking away from the police and fire departments.

"At some point you have to increase your revenues because your expenses are larger than your income," Kelly said. "You can't just trim your sails all the time and not change direction."

Eighty percent of the city schools' money comes from the state, and about $60 million must be spent in categories specified by the state. The city makes a contribution from city tax collections and sets the total appropriation. This year the city contributed $43.4 million from the property tax in a $296.79 million budget.

In combination with the tax increase, Kelly said, the board and city should agree to a fixed percentage of the total possible tax, whether or not the city imposes the full amount. He said that under state law, the city could impose another $15 million to $20 million in taxes for schools.

"There has to be a base that they will not fund us below," he said. "I would like to see us get 60 percent of the city's property tax limit. Even 50 percent would be a lot more than we get now."

The city now funds about 14 percent of the budget.

Interim Superintendent Albert Thompson has proposed a 1990-91 budget of $325 million to $339 million, an increase of 9 percent to 14.6 percent over this year.

Thompson proposes asking the city for $47.3 million -- up $3.9 million -- from the property tax.

City officials have said Buffalo faces a $30 million deficit for 1990-91, and several Common Council members have suggested raising taxes.

The business community and parents' groups appear ready to support a tax increase if the money goes to schools, Kelly said.

"You have a significant part of the community that is ready to increase the tax if it goes to the schools," he said.

"There is a lot of support out there. The people who are going to scream and holler are the people who don't want to sit down and be reasonable."

Unlike the suburbs, the school boards in the state's five largest cities cannot present their budgets directly to the taxpayers and propose raising taxes for schools.

An adequate funding formula would stop the budget battles between the mayor's office on the second floor of City Hall and the School Board on the eighth, Kelly said.

"The fights between the board and the mayor's office didn't start with Jimmy Griffin," he said. "It's a continuing problem for the last 20 years that I am aware of."

Richard H. Planavsky, city commissioner of administration and finance, did not return a telephone call seeking his comment. But Donald P. Quinlan, president of Graphic Controls Corp. and a director of Greater Buffalo Development Foundation, responded with surprise and approval.

"Wow!" said Quinlan, who is also co-chairman of the citizens committee aiding the search for a new superintendent.

Earlier this month, the citizens panel warned the School Board that a salary in the low $90,000 range is limiting the pool of applicants to run the system of 46,400 pupils and 78 schools.

"Any kind of a dedicated tax would be a step in the right direction," Quinlan said. "To get us out of this annual budget battle would be healthy."

As an employer, Quinlan said, he has a pool of competent applicants that includes city high school graduates, but he is aware of other applicants who do not have skills needed for jobs today.

"There are some who apply who are not adequately prepared," he said.

Kelly, who last year presided over $6 million in cuts from the school's budget request, said he never has and never will support deficit spending.

He said increases are linked to an inflation rate of about 5 percent, labor contracts that allow 7 percent annual increases, paying off old deficits, and new positions to provide for a growing elementary school population.

School administrators also estimate that the board will need $300 million to $400 million in coming years to update and replace buildings in a system where half the schools are more than 60 years old.

Kelly pointed out that under the City Charter, administrators and the board must present a budget request months before income is known. State appropriations have been as late as August.

"When the revenue base is estimated, the board will again have to make some tough decisions about what programs are going to be funded," Kelly said. "All will have to be balanced against available funds."

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