WEST ORANGE, NJ – Following a presentation from Business Administrator John Calavano, the West Orange Board of Education (WOBOE) unanimously approved a preliminary budget with an increase of $22.18 per month (or $266.21 annually) to the average home, assessed at $338,121.
The preliminary budget approved totals $170,999,914 for the 2020-2021 school year.
Superintendent Dr. J. Scott Cascone prefaced that as part of the budgeting process, the district assessed salaries, benefits, special education tuition, transportation and required maintenance and utilities, which he said are five major categories that contain increases outside of the district’s control.
According to the superintendent, the district expects an increase of $7,924,918 between the 2019-20 and 2020-21 fiscal years for these expenses. However, he added, this includes a 2-percent increase (or $2,752,916) in the local tax levy ($140,398,739) as well as an additional $2,276,176 in state aid ($17,826,168) that caused a deficit of $2,895,826 for the West Orange district.
“That’s before we’ve talked about any additions to programs [and] staff,” said Cascone. “So that frame out is really the budgeting and financial conundrum that we find ourselves and which basically every school district in the state of New Jersey finds itself.”
After meeting with the WOBOE on multiple occasions to discuss the budget, Cascone praised the board for keeping “a critical eye on fiscal responsibility.” He added that he believes the current iteration of the budget walks “the most responsible and prudent line between fiscal responsibility and enabling the school district to maintain its programs and move forward and execute its mission.”
Although the total tax levy—or money collected by the municipality for use in the district’s operating budget—and debt service fund has increased by 2.11 percent ($146,440,146) since last year, Calavano said the district was able to reduce the tax levy by $423,290 after paying the state back for aid and grant funding that was received in error approximately 10 years ago.
“The mistake was caught three years ago, and the state wanted it all back in one year,” said Calavano. “After pleading, the district was granted three years to pay everything back and now the district is caught up.”
Calavano also mentioned that within the tax levy, the district plans to utilize $692,440 out of a reserved $5 million bank cap—or unused portions of the tax levy that is available for the school board to use for up to three budget years, he explained.
He noted that although the district has one more year until that money expires, using any more of the banked cap would have a “tremendous, negative impact on the burden to the local taxpayer.”
Based on the average assessed value of homes in West Orange Township ($338,121), taxes are expected to increase by $22.18 per month or $266.21 for the 2020-21 school year.
Additional cost savings were found through shared services programs like Ed Data Services and Educational Services Commission of New Jersey for classroom materials, according to Calavano.
In terms budget items, Calavano noted that the district continues to support its technology initiatives by getting a three-year lease to purchase 2,800 Chromebooks for the district’s 1:1 initiative, in addition to 125 laptops for teachers and 60 desktops for staff.
Among its capital projects, the district currently hopes to upgrade the lighting system at Liberty Middle School, replace the main water line at St. Cloud Elementary, conduct a series of roof-replacement projects, retain wall replacements at Washington and Hazel Elementary and replace a structural wall at the bus garage.
According to Calavano, these capital projects are subject to change and may be swapped out for other projects as other issues come up.
In looking for possible reductions, Cascone acknowledged that this year’s budget requires the administration to be more “thoughtful and critical” about how future budgets will be developed.
As of this meeting, the district announced its intention to flex security and custodial schedules to cut down on overtime and consider the use of chaperoning for events.
“That’s just two of many things that we’ve looked at to bring about reductions; but when the rubber meets the road, these are relatively small,” said Cascone, adding that in order to operate with conservative fiscal prudence, the district needs to drastically reduce salaries, which currently make up approximately 58 percent of the budget.
He countered, however that increased class sizes and reduced programs will follow suit if salaries are reduced, thereby changing the landscape of the school district.
“You're going to be talking about increased class size; you're going to be talking about losing programs, the richness and the variety and the robustness of our programs, our extracurricular programs, our sports and the many, many offerings that we offer in this high school and other schools as well,” he said.
Although Cascone believes this iteration of the budget to be “fair and responsible,” he mentioned that the district needs to start prioritizing its programs.
“This is an annual challenge we're going to face and so moving forward,” he said. “It's going to be incumbent upon our school district to define what is our identity and what is our crucial mission.”
The superintendent added that the district must think critically about reductions.
Cascone noted that even if the money spent on instruction and support—which accounts for approximately 4 percent of the budget—was reduced by about $700,000, it would have a massive impact on what the district could do on a day-to-day basis by bringing it down to approximately $6 million.
Comments from board members included a common inquiry from Cheryl Merklinger, who wondered why the district is not taking advantage of the state health plan.
“Every year, we actually look at the state health plan, but all of our contracts have an ‘equal-or-better' provision saying that the board has the right to change health plans as long as it’s to something that’s as good or better than what we have now,” said Board President Ken Alper in response. “So, the state health plan […] ends up being more expensive or the same [as the current health plan].”
During public comment, former board member Sandra Mordecai questioned why items originally meant to be put on an upcoming referendum—including issues surrounding air quality, CO2 and HVAC—were not included in the budget as proposed.
Cascone explained that preliminary plans were sent to the state, but the cost of renovation and re-fabrication originally cost upwards of $50 million. Knowing that the WOBOE would be moving “a referendum vote forward in the next year or so” that would contribute to increased taxes, Cascone said the administration felt was important to keep a critical eye on the referendum by reducing the overall cost.
“I think that that is why we were perhaps a little bit more frugal than we would've liked to have been with the banked cap because we didn't want to compound that between this budget and a referendum that's forthcoming,” said Cascone.
He also noted that the WOBOE intended to hold a public work session in early April in order to discuss the priority items brought up last year in a comprehensive facilities evaluation completed by architectural and design firm EI Associates.
“That being said, HVAC continues to be a number one priority,” said Cascone, elaborating that the district will focus on issues related to classrooms that are known to have significant air-quality issues and will ensure that the HVAC system is kept up to code. “Obviously, the complete renovation and re-fabrication of our HVAC system is going to be an ongoing process, but a piece of the referendum will be dedicated to the most critical HVAC needs and there will be other projects which will be determined moving forward to fill the rest of that referendum out, which again will be significantly less than what was originally proposed,” Cascone said.
A public hearing on the 2020-21 school budget is currently scheduled for May 4.
The next meeting, scheduled for April 6, will be live-streamed to allow for public comment on the preliminary budget and other items.