Rye Board of Education Approves $71.9 Million Budget

The Rye Board of Education unanimously voted to approve a $71.9 million budget on Tuesday. 

The approved budget includes a 1.78 percent tax levy increase and a 2.52 percent increase in the tax rate. This year’s total budget is about $2.2 million more

The district decided to use $1.1 million of its existing fund balance to offset a larger tax levy increase. Because of a $1 million settlement with The Osborn after a 13-year property tax dispute, the district also had additional money, of which it opted to use a large proportion for one-time expenses. Its labor agreement with collective bargaining units , and enabled the district to have a degree of certainty in formulating this year’s budget. However, a proposed 2-percent tax cap could lead to budget and program cuts in upcoming fiscal years. 

Despite a more than $330,000 decrease in state aid and a 7-percent increase in employee benefits costs, the approved budget includes additional spending on another teacher for Osborn Elementary School and $700,000 to improve the district’s facilities. 

The Osborn settlement money will be used to pay for the $700,000 in capital spending. The district currently has a list of several capital improvement projects that total more than $19 million. Some of the things on the list include renovating bathrooms and upgrading science labs at Rye High School and doing work on the district’s athletic fields. 

Board member Kendall Egan argued for an additional $300,000 in funding for facilities to go along with the $500,000 allotment for capital expenses Superintendent Edward Shine introduced as part of several recommended changes to the district’s proposed budget.

After Egan put forth her idea, the board debated how much of the district’s $1 million windfall from The Osborn settlement should be used for capital expenses. They also discussed whether the money should be used to make headway on more expensive, high-priority projects or on smaller projects that could be completed more quickly.

Board member Edward Fox argued repeatedly that the state’s looming proposal for a 2-percent property tax cap necessitated that the district be more prudent with its money and not use too much of its fund balance, which totaled about $12.4 million last year.

“I continue to have a lingering concern about what politicians in Albany want to come up with next,” Fox said. “I’m very happy to support what the administration has proposed, with sort of the caveat that if something happens, i.e. a tax cap of some draconian proportions between now and the end of the legislative session—which is presumably coextensive with the end of our 2010-11 budget year—we may have to have a conversation on July 1 about what we can really do with our fund balance.”

The tax cap has drawn the ire of many local school districts and municipalities. The Rye school district and Rye City Council have even issued a joint resolution, which was passed by the Board of Education on Tuesday, that calls for the State Assembly to reject a property tax cap unless mandate relief is included in the legislation.

In their resolution, Rye officials warn that “the establishment of a 2% hard cap, as proposed by the Governor and approved by the State Senate, would ultimately require drastic cuts in essential local school district and city programs, services and staffing that would compromise our residents expectations for quality of life.”

If the tax cap is passed by the state legislature, local school districts like Rye could still introduce a budget with a more than 2-percent tax levy increase. However, 60 percent of voters would have to approve that increase in order for it to be enacted. If the district does not meet that percentage threshold, it may find itself having to use part of its fund balance every year to offset significant tax increases.

On Tuesday, the Board of Education decided to use an additional $200,000 of fund balance for facilities’ needs, slightly lower than the $300,000 Egan proposed. Though board members did not specify which capital improvement projects for which the money would be use, there was a consensus that the additional revenue source from The Osborn settlement should be used to address issues the district has delayed tackling because of fiscal constraints.

“When I look at the overall budget, I do think it is keeping with the broader values of the community, which is very important,” board member Ray Schmitt said before the budget was approved by a unanimous 7-0 vote. “We are adding teachers while other districts are being forced to cut or renegotiate contracts or do things like increasing class size, [and] we are making dent, albeit a small one, in critical facilities capital projects.”

The approved budget now faces a public vote. The district will hold a budget hearing on May 3 to allow residents to comment. Residents then will vote on the budget May 17.

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