Milford School Board 11/19/07

The meeting was delayed by a half-hour because we had a "non-meeting meeting" with Attorney Bill Drescher before the regular school board meeting, and the non-meeting ran longer than expected. A meeting is technically defined by NH RSA 91-A:2, and according to 91-A:2 (c), consultations with legal counsel are by definition not a meeting, so It's not appropriate for me to discuss what was reviewed in the non-meeting.

The regular session was a rather lengthy meeting, and covered a variety of hot topics. We skipped the Superintendent's report this week due to time constraints.


Vote Regarding Sale of Bonds - We passed a formal motion to authorize the sale of bonds for the High School renovation project. We had some trouble a month or two ago where the bond bank had some problems with the wording of the warrant article, but those are all resolved now. Passing this motion will enable the sale of bonds to go forward.


High School Renovation Project - The Phase I track portion of renovation project is progressing well. The first course of pavement was laid this week and the field work is on schedule. We processed a change order to revamp the way the electrical and data feeds to the field are arranged.

Bids were received for the main building renovation portion, or Phase II of the project. We awarded the mechanical and electrical bids at the previous meeting, and we awarded about a dozen additional bids during this meeting. Netting everything out, it appears that we are on budget for the project, with about $250K of contingency still available. This is needed since you never know what you will run into on a renovation project, and we need to be able to cover whatever problems arise during the project.

Policy Reviews - Bert Becker was appointed to the policy committee, replacing Bob Willete who will focus on the Bales study committee. We reviewed 8 policies, moving 4 to a first reading and 4 to a second reading and enactment.

We passed new policy 5095 on Searches of Students, Student's Property and School Owned Property. This policy was modeled after the NH School Board Association model policy. The policy documents current practice, and provides details on what procedures are allowed.

We also passed revised policy 6030 Computer Software and Hardware Policy. The major changes in the policy relate to the use of non-district owned equipment within the district. The main point is that anyone wishing to use non-district equipment must first gain the approval of the Technology Director.

Matt Ballou will soon be installing equipment that will automatically identify new equipment that is added to the network to help to curb any unintentional or intentional violations of this policy.

Budget Items - This was the meat of the meeting. We held a joint meeting with the budget committee on Saturday where the administration reviewed all aspects of the budget. We followed the basic flow that we have developed over the years, and we were able to gain good insight to the budget during the day.

The main problem is that there were a lot of special situations this year, and the budget was higher than desired.

Kindergarten - We first reviewed Kindergarten in some detail, since that is a topic that has a lot of influence on the overall budget. The state committee that is addressing the cost of an adequate education had made some preliminary decisions, and these were discussed at the meeting by Peter Bragdon. Some of the more significant proposals.
- The state will allow districts to delay implementation of public kindergarten by one year. they will need to present a plan to the state showing how they will be implementing it in the following year.
- Kindergarten construction will be eligible for 75% state aid for the portions of the building that are actual classrooms or connecting corridors.
- Kindergarten students will be eligible for 1/2 the adequacy money that is made available to full-time students. This amount is still to be determined, but will be at least $1200 per student according to Peter Bragdon. The Telegraph reported today that it will be at least $1900.
- One of the key drivers of how the state will calculate adequate education cost is the cost of teachers. Some members of the state committee want to set it at the cost of the lowest paid teacher in the state, and others want to set it at the average salary of new teachers in the state. In either case, this will be much less than the average cost of teachers in the state since only a small portion of teachers are new teachers.
- The state authorized 100% of portables for three years to help get the programs started.

Kindergarten delayed - I made a motion to delay the implementation of public kindergarten until 2009. There was some confusion about the motion, and it was not initially supported. We changed the wording slightly, and the motion passed.

Kindergarten Bond Issue - The main issue with implementing kindergarten in Milford is that we need to have a facility to provide the program. There are several options, but the one that makes the most sense to me at this time is what is known as option 3, where we tear down the Bales annex and add a four room addition to Jacques. This is the option that is supported by the district administration.

The advantages of option 3 are that it is relatively low cost ($1.8M), and gets the kindergarten and first grades under the same roof. This eliminates the issues relating to moving across the parking lot to get to the annex as would occur in option 2 (renovating the annex). The downside is that there is little upside space options, and a sustained upturn in enrollments may require a new construction fix at some time in the future. The space looks like it will meet our needs for the near term, and I don't see anything on the horizon that would indicate a large upturn in enrollments. The trend in New Hampshire in recent years has been for declining enrollments, and this should continue, at least for a while.

I had been originally in favor of constructing a new building at Brox (option 4) as the preferred choice for two main reasons. One is that it is the option that provides the most future flexibility. If we get an upturn in enrollments, then we would still have the option to add four classrooms to Jacques to handle the first grade enrollments, and we would be able to add classrooms to the Brox building to handle the kindergarten increases.

The second reason that I supported the Brox construction option is that it is likely that we will get 75% building aid now, but we will only get 30% if we build the same project in the future. The difference in state aid is roughly $2M on the $4.5M Brox construction project. Our portion of the increase from option 3 (Jacques addition) to option 4 (new Brox construction) is roughly $700K. It seemed to me that spending an extra $700K now would be a good investment to save $2M at some time in the future (perhaps 10-15 years down the road. Another way to look at is that we would get four extra classrooms plus some other supporting functions for only $700K. (The Jacques addition is for four classrooms, and the separate Brox building would be eight rooms).

The point that changed my mind on this is that the administration brought some new information to us at the budget meeting last Saturday. It turns out that there a several additional people required to run a separate building instead of just adding on to an existing building. I knew that there would be an additional expense, but I did not expect it to be so high. Adding all the additional support staff for a separate building adds roughly $250K to the operating budget each year. Over 10-15 years, this would add up to $2.5m to $3.8M in additional operational costs, which is more than the $2M savings. Since it is a negative number, we might as well go with the lower cost option and save the money.

There has been some discussion about what will happen if sometime soon we change to full-day kindergarten instead of half-day kindergarten. My response to that is that in my opinion it is very unlikely that the Milford voters would approve a move to full-day kindergarten on their own any time soon, so we should not plan on that as a viable option. On the other side, if the state mandates that we move to full-day kindergarten, then that would be a new mandate, and they would provide funding at that time at some increased level (perhaps the same 75% that is offered now). We would be in the same position as we are now, so there is no reason to plan for it.

I doubt that the state will mandate full-day kindergarten any time soon either. The cost to the state would be very high since there are very few districts currently providing full-day programs. As a rough estimate, if there are 15,000 kindergarten students in the state, and it costs $2500 in adequacy aid to upgrade them from half-day to full-day, then that is an extra $38M for the entire state. They are struggling to make the current situation work, so I doubt that they want to make the cost problem $38M worse.

I made a motion to choose option 3 as our method for implementing public kindergarten in the 09-10 school year. Bert Becker appeared to support the motion, but it did not look like anyone else would support the motion at this time, so I withdrew it. We have some parliamentary rules that make it more difficult to pass something that had already been defeated once, so it is not helpful to have a losing vote on the record.

I am hopeful that we will be able to come up with some sort of a plan that can be supported by a majority of the board. The issue is that we are now legally obligated to provide public kindergarten, and if we choose to ignore that legal requirement, then we could be liable to pay penalties if we are sued by an aggrieved party.

Operating Budget - The administration has done another fine job this year with developing the first draft of the operating budget. They reviewed all the costs and provided forecasts based on reasonable expectations. Their first draft was based on the assumption that we would continue along the same path as we have been following where we make continuous improvements each year with respect to curriculum and programs. The district as a whole has been on the right track for several years, and we have gotten better each year, perhaps not at a rate that everyone would like, but at least at a steady pace that yields positive improvements.

The problem was that the first pass of the budget came in too high relative to what we can afford. A rough rule of thumb that we frequently use is to keep our cost increases to a level not to exceed the inflation rate as measured by the CPI plus the net change in enrollment. The current trailing 12 month CPI is 3.1%, and we expect an enrollment increase of 1.4% for a total target increase of 4.5%.

Peter Bragdon made a motion to bring the increase down to 4.9%. There are some additional special education costs expected next year, with the need for three additional one-on-one associates to meet IEP requirements. Special education costs are mandated by federal law, and we are required to fulfill them. It seems reasonable to allow a slightly higher increase when there are significant increase in special education costs. The net effect of this motion was the creation of the need to identify $400K of cuts to be made to the proposed budget. The administration was tasked with coming back to the next meeting with a prioritized list of cuts to meet the $400K requirement, with the proviso that the cuts not come out of debt service, food service, or fund transfers. The motion passed 5-0.

Even with these cuts, this increase results in a large tax increase. The main factor is that the state had their big increase in adequacy aid this past year, and unless the rules change, the adequacy aid will be the same next year. Since there will not be an increase in state aid, all of the increase in costs will have to be borne by local property taxes. Since the increase will be divided by a smaller base, the percentage increase is higher. The adequacy aid and other revenues source are excluded from the local tax rate calculation.

Now, the state is currently going through their adequacy costing formula and there could be huge shifts in adequacy aid which throw this out the window. We will have to wait and see.

My philosophy is to watch the actual spending closely since that is what we have the most control over. If we manage our spending, then the corresponding taxes will tend to follow over time. Sometimes we make out with revenue sources, like last year where we ended up with a decrease in taxes due to increased state aid. Other times we lose out, such as this year were it looks like there will not be an increase in aid.

Default budget: We received our first draft of the default budget. I haven't had a chance to review it in detail yet, so I don't have a comment on it at this time. As presented, it does not include kindergarten funding. It is not clear to me if kindergarten funding should be in the default budget this year or not since the legal status of the kindergarten mandate for this year is murky at best. It was mandated for the o8-09 school year by the law that passed in June, but the adequacy aid group has indicated that they plan to ask for it to be moved to the 09-10 school year. The question is, do you follow a course of action based on the rules as they currently exist, or do you follow a course of action based on how you think that the rules will end up?

I think that it is clear that it will need to be in the default budget next year since it is very likely that the law will mandate it for that year.