Peek at five-year forecast underlines school budget worries
The five-year financial forecast for Cambridge schools shows revenue shortfalls and rising enrollment, starting with a $3.7 million gap in the next fiscal year.
The figures presented Tuesday to the School Committee are projections only, and obviously get less and less solid toward the end of the five-year span, said the district’s chief financial officer, Claire Spinner. Steps taken this year will also have an effect on future figures.
“We are monitoring our budget very carefully,” Spinner said. “We are going to be very close.”
The figures will be firmed up within the next month, she said. But what she presented showed the following:
The $3.7 million shortfall in the next fiscal year results from a 2.9 percent increase in revenues (to $137.5 million) overwhelmed by a 5.7 percent increase in expenditures (to $141.2 million).
As always, property taxes contributes the most to the school budget, $112 million next year, or 82 percent, and the city is increasing its contribution by 4 percent and an additional $1.4 million. More city money comes from hotel and motel fees, fines and forfeitures.
Meanwhile, $109.3 million will be spent on salaries and benefits; $10.9 million on transportation and energy; $10.7 for special education tuition; and $10.3 on other expenses.
Spinner’s extremely preliminary projections show a $3.4 million shortfall in fiscal year 2012 and, looking to the horizon, $10.9 million in fiscal year 2015. The figures rely on a 2.9 percent rate of growth in revenue, but a 4.7 percent rate of growth in expenditures.
“The system is unsustainable in its current incarnation. You have two choices: You find ways to raise revenues or you cut expenditures,” Superintendent Jeff Young said. “I expect the rate of growth the school budget has seen over the past few years will slow … and the decision-making process [for cuts and efficiencies] will pick up steam this year.”
“I don’t want to be overly alarmist. The world’s not going to fall apart, we’re not going to have 37 kids in each class,” Young said. “But we’ve reached a bit of a tipping point and have to ask ourselves, ‘How do we maximize our resources?’”
It was going to be a daunting task, committee member Patty Nolan said, appreciating that Young had the panel express its priorities up front. Before Young’s appointment, superintendents prioritized on their own and presented budgets to the committee for approval or rejection.
This fiscal year actually saw extraordinary growth in student enrollment — a total of 187 students added to the last fiscal year’s 5,950 students — and a 2 percent rate of growth is expected in every fiscal year through 2015 except for 2014, when a 2 percent decrease is predicted.