Guest Column: The 2012-13 Holmdel School Budget

Over the last decade, I’ve had many conversations with friends, neighbors, and residents about Holmdel’s schools, and inevitably two questions surface.

What can we do to keep taxes manageable?  And probably even more important, what can we do to make sure we spend our money wisely?

Our mission as a school district is to provide our children a through and efficient education.  We have to continually balance our desire to provide one of the best public educational experiences in the country, while keeping costs at a level this community can afford.  You can’t achieve both goals by accident—it takes careful planning, fiscal prudence, and some tough choices.

Or as a noted former student at the London School of Economics named Mick Jagger once noted, “You can’t always get what you want, but if you try sometimes, you get what you need.”

In late March, the Board of Education unanimously approved a 2012-13 school budget of roughly $52 million.  Here are a few highlights about this budget, which are worth noting.

Over the last few years, the School District has taken steps to control our operating costs, primarily by outsourcing and reducing energy consumption. Whenever we find savings—usually as a result of outside grants, reduced over-time or favorable labor contracts—we have used the money essentially for two purposes—maintenance and tax relief.

In an earlier column, I noted the advantages of having a school district that is essentially self-funded (92 percent of our budget comes directly from local property taxpayers).  It means since we don’t rely heavily on outside sources for revenues, we have greater flexibility to address capital needs, especially when we resist the temptation to use these budgetary “one-offs” to pay for operating costs.  In fact, because of this approach, we have been able to reinvest over $2.5 million into maintenance and repair projects over the last five years without the need to either raise taxes or seek bond issues.

We also resisted the temptation to raise our taxes to the absolute maximum.  This budget falls slightly more than $350,000 below the two percent cap allowed by law.  In addition, we chose not to take advantage of a state waiver, which would have permitted us to increase the budget by $347,000 to cover rising health care costs.

The State also allows us to “bank” those revenues that we “leave on the table” when we don’t seek a two percent increase.  For example, we chose not to raise taxes last year and instead passed along the savings to taxpayers resulting from our labor contract negotiation.  Under state guidelines, this decision meant we could have raised taxes an additional $944,000 this year.

Add up the numbers, and you will see that the School District could have increased taxes by roughly $1.6 million.  We chose not to do that.

Instead, we chose fiscal restraint, because our school district is well run.  Utility costs this year dropped almost 14%, and we reduced our reliance on mandated professional services related to the energy conservation program by close to 44%. These savings allowed us to invest money directly into educational initiatives that directly advance our district goals, such as the addition of a new Spanish teaching position and technology enhancements to prepare us for state testing changes that we expect to see in 2014.  We have also set aside money to address major maintenance projects that will improve the safety and security of our schools.

In sum, your school district is in great financial shape, we kept our tax increase well below cap (1.25 percent), and we have begun taking steps to keep taxes low in the 2013-14 school year.  The State’s recent designation of Holmdel High as a “reward” school offers one sign that your tax dollars are also being well spent.

By the way, several documents have been posted on the Holmdel School District web site which provide additional details about the budget, including the presentation delivered to the Board by Business Administrator Michael Petrizzo.  Feel free to contact the Board or the School Administration if you have any questions.

Enjoy the spring!

On behalf of my Board colleagues,

Mike Sockol, Board Member