Tri-Town Readies for Nashoba Budget…Dec. 16, 2015
By Ann Needle
The Nashoba District’s three towns are already talking about what they hope to see for the 2016/17 school budget. The Dec. 9 Tri-Town meeting in Stow also had town representatives discussing how they could help Nashoba begin addressing new standards for accounting for retiree benefits.
Bolton Selectman Chair Mark Sprague said his town was looking for an idea of how much of a hike Stow and Lancaster would support in school spending. He noted that Bolton has been trying to keep recent budgets at level services—which means about a 2% hike outside of any OPEB contribution—and would like to see Nashoba stay at about that percentage. Stow Selectman Chair Don Hawkes and Lancaster Town Manager Ryan McNutt agreed their towns are looking at similar increases.
But School Committee Rep. Mark Jones of Stow cautioned that salaries and benefits alone will increase the school budget by about 3%, given contractual obligations that must be met. He estimated that salaries and benefits make up about 80% of Nashoba’s annual budget.
“This is what we’re hoping you guys can do, but it’s a complex process,” agreed Stow Selectman Brian Burke.
Asst. Superintendent George King also noted that any employee-related expenses are difficult to pinpoint until health insurance and benefits policies are renewed after December. As for the district’s Excess and Deficiency (“free cash”) account, he estimated this stands at about $1.3 million, compared with about $2.5 million a year ago. Often used to help whittle down any budget hikes, E&D was drawn on in higher amounts than usual for this year after the towns asked for more relief from increasing assessments.
Looking to future budgets, SC Rep. Neal Darcy explained the SC would like to eventually adopt the “budget book” approach of many other districts. This approach goes beyond the pages of spread sheet data to discuss the overview and goals of each department. He added, “It’s going to be much easier for a layperson to read this and understand the numbers.” Darcy also mentioned it is a method incoming Interim Superintendent Curtis Bates has worked with. (For a glimpse at a local district budget book, go to the Concord Public Schools site )
OPEB On the Table
Nashoba also continues to wrestle with how to address new accounting standards on retiree benefits for state school districts and municipalities. The standards on these other post-employment benefits call for state school districts and municipalities to invest for future retirees’ health insurance and other benefits well before they are paid out. According to Bolton Selectman Tom Frain, Nashoba’s OPEB liability lies at about $54 million.
Unlike the current pay-as-you-go approach that Nashoba and most other districts have taken toward employees’ retirement benefits, the philosophy behind investing in OPEB “is to get everything paid by the time they retire, rather than by the time they die,” George King explained. The accounting standard is not yet law, so funding future OPEB is not mandatory. Looking at Nashoba’s finances, King remarked that reaching that current $54 million estimate (growing by about $5 million annually) will probably not happen, but partial funding is do-able.
Romasco pointed out that even if the district had that money, it would likely spend it on more immediate priorities. But she agreed with others at Tri-Town that settling on a target amount to set aside toward OPEB each year would be helpful.
Elsewhere in the district, Romasco reported that Nashoba Regional High School was re-accredited by the New England Association of Schools and Colleges, and given a number of commendations by NEASC. She added that NRHS Principal Dr. Parry Graham would present details at the Dec. 16 SC meeting on NEASC’s recommendations for the school.