Audit shows $1.4M school budget surplus

REGION 16 — For the second straight time, the Region 16 school budget ended with an unreserved year-end balance of more than $1 million.

An audit of the $39.7 million 2014-15 budget for the region, which oversees schools in Beacon Falls and Prospect, showed the district finished the fiscal year with a surplus of roughly $1.44 million or about 3.6 percent of the budget.

The audit was presented to and approved by the Board of Education at its Jan. 13 meeting.

The surplus stems from a combination of unanticipated revenue and savings in accounts, particularly salaries and health care.

The region received a net of about $336,000 in unexpected revenue during the 2014-15 fiscal, according to information provided to the board by Director of Finance and Business Operations Pamela Mangini.

The district received about $250,000 more than expected from the excess cost grant, a state grant that is used to offset the cost of high risk special needs students.

Mangini said the excess cost grant fluctuates from year to year. The fluctuations make it difficult to project what districts will receive and causes districts to lean on the conservative side when budgeting, she said.

Over the past six years, Mangini said the district has received reimbursements ranging from 73 to 84 percent of its cost under the grant. In 2014-15, she said the district was reimbursed about 80 percent of its cost.

The district also received an $116,971 Medicaid reimbursement in 2014-15 that was unexpected.

Mangini said the state was lagging behind in its Medicaid reimbursement and the $116,971 was what the district was owed for two plus years. She said the district will probably never see a figure that high again when it comes to the Medicaid reimbursement.

The larger savings in the 2014-15 budget followed recent trends of teachers retiring or leaving, and less employees taking the district’s health care.

The district saved about $520,000 in salaries. The bulk of the savings came from hiring new, younger teachers that typically don’t make as much as their senior peers to fill vacant positions.

There was also a savings of about $440,000 in medical benefits due to less employees opting for the health care plan.

Superintendent of Schools Michael Yamin said about 20 teachers either retired or left last school year.

“That’s where these are very tough numbers to nail down,” Yamin said when addressing the budget and surplus. “Now, is it more than we want? Yes. Can we do a better job? Absolutely.”

The budget balance will be divided between Beacon Falls and Prospect using the student population ratio of roughly 60 percent for Prospect and 40 percent for Beacon Falls. The surplus is expected to be used to pay for education expenses in the current school year, according to school officials.

The board can also choose to transfer money from the surplus into a capital non-recurring account, which can only be used to pay for one-time capital expenses. The board can transfer up to 1 percent of its budget a year into the account. In this case, it would be up to $397,350.

Ultimately, voters in the region would have to approve the transfer. Two such transfers have been approved in recent years.

The board is expected to discuss and possibly act on the transfer at its Jan. 27 meeting at the request of Vice Chair Robert Hiscox.

The $1.44 million surplus comes on the heels of two other significant year-end balances. The 2012-13 school budget had a surplus of $744,191, followed by a roughly $1.3 million surplus in the 2013-14 budget.

The school board has faced criticism from town officials over its handling of the budget and the recent surpluses.

School board Chair Sheryl Feducia said she understands how the surpluses can be perceived by some of the public. She said the school budget is a daily operation.

“There are things that happen throughout the fiscal year that people have to realize we look at every single day,” Feducia said.

Feducia added that officials are constantly looking for ways to save money throughout the year.

“We’ve had some good years and we can justify every saving that we’ve had,” Feducia said.

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