NOTES OF FEBRUARY 3, 2016 RYE SCHOOL DELIBERATIVE SESSION
Final Revision B – Provided by the Rye Civic League
Present on the stage (left to right as viewed from the audience): Substitute Clerk Amy Reynolds (Rye Junior High Special Education Teacher), SAU 50 Superintendent Sal Petralia, School Board Member Kevin Brandon, School Board Chairman Scott Marion, School Board Members Mike Moody, Kate Hillman and Jeanne Moynahan.
Additional persons present from the School District and SAU 50 included: SAU50 Business Manager Jim Katkin, Rye Junior High School Principal Chris Pollett, Rye Elementary School Principal Suzanne Lull and SAU 50 Assistant Superintendent Kelli Killen.
Election workers present: Donna Decotis, Deputy Town Clerk, Andrea Morrissey, Assistant Town Clerk.
Editor’s
note: The elapsed times are relative to
start of each video segment. Segments
consist of one or more warrant articles.
To access the video for a particular warrant article, click on the
heading for the warrant article. The
video will be positioned to the beginning of the segment. You may then use the slider to position the
video to the appropriate elapsed time.
The video is available at http://vimeo.com/154184848/
Summary
4. The rationale for a $10,000 expendable trust for unanticipated heating oil costs was given.
Warrant Article
Links
Article 2: Wedgewood Farm expendable trust ($60,000)
Article 3: Heating oil expendable trust ($10,000)
Introduction (0:00
elapsed)
School District Moderator Robert Eaton called the meeting to order shortly after 6:30 p.m. He started by stating that Mike Moody was stepping down from the School Board and summarizing his accomplishments. There was applause.
Moderator Eaton then introduced the School Board Members, the Substitute Clerk, the Superintendent, Assistant Superintendent Kelli Killen, Patricia Dowey, SAU 50 Special Education Director, Rye Junior High School Principal Chris Pollet, Rye Elementary School Principal Suzanne Lull, SAU 50 Business Administrator Jim Katkin.
Moderator Eaton then introduced the candidates for School District offices. Scott Marion is running for reelection to the School Board. There are two seats available, but Scott is the only candidate who signed up by the deadline, so the second seat will be filled by a write-in candidate. For School District Clerk, filling out a two year term, is Donna Decotis. For School District Treasurer the candidate is Mark Zartarian, he said.
Moderator Eaton announced the Candidates Night, February 29 at 7:00 p.m. at the Rye Public Library. The Town Election will be Tuesday, March 8 and the New Hampshire Presidential Primary next Tuesday February 9. Polls will be open for both elections from 8:00 a.m. to 7:00 p.m., he said.
Rules (5:05
elapsed)
Moderator Eaton then went over the rules. He referred to the rules stating that recounts would be conducted by secret ballot. That was met by some dismay by the voters at the Town Deliberative Session, he said.
Editor’s note: See the notes (part one) of the Town
Deliberative Session on January 30, 2016.
Moderator Eaton had, based on a show of cards, declared that the meeting
had voted to end debate on Article 4.
After Peter Crawford questioned whether the requisite two-thirds
majority had been achieved and requested a recount, there were at least seven
cards held up to support that request.
Moderator Eaton then stated that the recount had to be by secret
ballot. After groans, the meeting voted
to conduct the vote by a count of cards.
The vote was 55-33 (62.5%) in favor, however Moderator Eaton declared
that the motion had passed. After the
next article had been debated, he announced that his determination had been in
error, that the necessary two-thirds (66.7%) majority had not been achieved,
and that debate would be reopened on Article 4.
The Selectmen and Town Counsel objected and sought to override the
Moderator and cut off debate, however that motion failed.
Moderator Eaton continued, stating that if the majority are agreeable to conducting the recount by a hand count then that would be done.
Moderator Eaton stated that a few people at the Town Deliberative session had been unclear on what calling the question means. Once the question has been called and there is a second, he will call for a vote on the motion to end debate. The only person who may speak to the article is the person who is then speaking. Then a vote will be called for. Even if the person had his hand up, I must call for a vote. It is then up to you to decide whether to end debate. Debate will be ended only if two-thirds decide to do so.
Article
1: Operating budget $13,496,384 (11:55
elapsed)
Moderator Eaton read the warrant article, which stated that, if defeated, the default budget would be $13,349,549.
School Board Chairman Scott Marion addressed the operating budget. He stated that it is only a slight increase from last year. We directed Mr. Katkin and the staff to bring in as flat a budget as possible and that was done. An additional $60,000 was built into the budget as it had been anticipated that Portsmouth High School might have instituted an earlier start time, necessitating an additional bus route. Mr. Marion moved to reduce the budget to $13,436,384. Board Member Hillman seconded. Mr. Marion explained that Portsmouth had only voted to explore this option. The money had been added to the budget at the point that they had been strongly contemplating it. Since the bus will not be needed, the fiscally responsible thing to do is to pull the money out of the budget, he said.
Paul Goldman, 1190 Washington Rd., Chairman of the Rye Budget Committee, applauded the effort. He pointed out that immediately after the meeting, the Budget Committee would normally take a vote. However, there is not a voting majority present, so they cannot do so. If you do this, we will have to have a delayed vote. Mr. Goldman stated that there is a conflict again this year with a Zoning Board meeting. Two members are at that meeting, he said.
There was no further discussion on the amendment.
The vote was unanimous in favor.
(17:40 elapsed)
Joe Cummins stated that nothing is dearer to his heart than education. He moved that the Elementary School heating budget be reduced by $4305, from $47,352 to $43,047 and that the operating budget also be reduced by $4305.
Moderator Eaton stated that, were the amendment to pass, the operating budget would be reduced to $13,432,079. Peter Crawford seconded.
Mr. Cummins stated that it was hard work and there were some sorrowful circumstances surrounding keeping the budget to an approximately zero percent growth rate. He stated that he appreciates the Budget Committee’s efforts along those lines as well.
This comes about because of an arithmetic error. The derivative price per gallon is $3.19 using the budget dollar amount and the gallons projected, but in the narrative of the budget $2.90 is cited as the reference price.
Editor’s note: See page 75 of the 2016-2017 Proposed Rye
School District Budget, available at http://www.sau50.org/rye/rjh/. That page indicates that the budget for
heating oil for the Elementary School is $47,352, based on an estimated usage
of 14,843.8 gallons and a price of $2.90 per gallon. However, 14,843.8 times $2.90 is $43,047, not
$47,352 as indicated. Dividing $47,352
by 14,843.8 gallons yields a price per gallon of $3.19, exactly ten percent
higher.
Mr. Cummins continued, stating that this is purely an arithmetic error. He stated that Kensington has a budgeted price of $2.25, Deerfield a price of $2.50, Epsom, he believes, is $1.97, North Hampton is $2.25, South Hampton is $2.25, Hampton Falls is $2.25, I believe. The Town itself, as the Budget Committee knows, is using, I believe, $2.39 and $2.48. They have some blended fuel to avoid gelling. Mr. Cummins stated that he is very sympathetic to having reserves to avoid the trials and tribulations of a special School District Meeting. This is a very small adjustment. This is an arithmetic adjustment to be in step with all other school districts, he said.
(23:25 elapsed)
School
District Chairman Scott Marion stated that the $4305 represents .032 percent of
the operating budget. While he
appreciates Mr. Cummins, and presumably Mr. Crawford’s, efforts to make sure
that we are projecting oil prices accurately, he reminded people that this
budget is built in September and October, and is for expenditures from July 1,
2016 through June 30, 2017. I have no
idea what the price of oil will be in March or February of 2017, he
argued. I don’t think anyone in the room
does. So what we do is work off of a
multi-year average. The amount of money
that we are talking about seems not even worth voting on. He stated that, while Mr. Cummins referred to
a specific line item in the budget, they have no authority to direct us to
reduce any line item. It’s up to the
School Board to decide how it is applied to the various line items. He stated that if an attempt is made to
micromanage the budget we will have meetings as long as, or longer than, we had
on Saturday. Editor’s note: He was apparently
referring to the Town Deliberative Session which lasted from 9:00 a.m. to
nearly 5:00 p.m.
(25:52 elapsed)
Peter Crawford, 171 Brackett Rd., said that he would like to correct some things said by Mr. Marion. Past practice has always been for the Town and the School, working together, to obtain bids in June of a particular that would apply from July through June. That matches up perfectly with the school year. We are now in February. In approximately four months, if past practice is followed, the Town and the School will be going out to bid. The current price from newenglandoil.com indicates that you can get oil as low as $1.529 from Advantage Fuel, and the highest among 10 or 15 oil companies in the local area, is $1.699. So, $3.19 per gallon, which is what the budget computes it at, although it says for the Elementary School that $2.90 was used, if you divide the numbers it’s actually $3.19, he said. That is more than twice the lowest price that would be available today, and almost twice the highest price which you could pay for small quantities of heating oil as a residential customer. We think it’s entirely unreasonable to think that the price might double in the next four months, he argued.
Mr. Crawford continued, saying that Mr. Marion talked about the inability to control specific line items. Mr. Crawford read from RSA 32:10, I(e): “The town or district meeting may vote separately on individual purposes of appropriation contained within any warrant article or budget, but such a separate vote shall not affect the governing body’s ability to transfer appropriations…” He stated that the rest is not applicable. Moderator Eaton stated that the remainder refers to zeroing out the line item. Mr. Crawford agreed, saying that we’re not trying to do that.
To Mr. Marion’s point that this is such a small amount, Mr. Crawford said that they are trying to take a first step. The total heating oil use of the School District, between the two schools, is approximately 40,000 gallons per year. It goes up and down. If you multiply that by the $3.19 price, you have $120,000 to $130,000 worth of heating oil budgeted. If that is twice what it should be, you’re looking at $50,000 to $60,000 of overbudgeting. We’re not trying today to solve that entire problem. We’re sympathetic to the School Board. We just want to take this little first step to compensate for the expendable trust warrant that is also on the ballot so that we keep this budget neutral because we do believe that an expendable trust is necessary, he said.
If you look at the $120,000 heating oil expenditure, that’s nearly one percent of the total budget. It’s not really a small amount. If the price is double what it should be, that’s .5 percent of the School Budget that could be saved. When the School Board started the discussions this year, they had two options. One was a zero percent increase and the other was two percent. Half a percent, when you’re looking at that narrow of a range of increases, is a big deal. Mr. Crawford said “the fact that there’s more money in the heating oil budget than there needs to be… I take the School Board’s word for it that it didn’t affect the number of teachers and the teaching quality, but you have to look at that and say well gee, shouldn’t the budget be accurate going in, and shouldn’t the heating oil number be accurate going in so they can take the correct facts into account when making the key decisions that affect the education of the children in this Town.”
(31:20 elapsed)
Phil Winslow, 100 Harbor Rd., asked Mr. Goldman and Mr. Marion what would happen to the funds if the budget for fuel is underspent by $50,000 or $60,000.
SAU 50 Business Manager Jim Katkin said that the funds may be transferred by the School Board to a different account, but generally that does not happen. “We return back what we don’t expend,” he asserted.
Mr. Katkin stated that he starts the budget in August. If he had stood in front of you last year and told you that you could buy gas for $1.50, you’d think that I was crazy or that you had a “real dilly” for a business administrator. Since July, the stock market has dropped 2600 points. Oil used to be $130 a barrel but it is running slightly less than $30 a barrel now. Mr. Crawford brought up some good points about the cost of oil. I cannot buy oil now, I have to buy it in July. So, how did I come up with $2.90. Let’s look back over the past five years. We bought oil this year for $2.25 and we thought we got a bargain. You would tell me now that that was not a bargain, but in July it was. Last year, I had to buy it for $3.13. I’m buying between 40 and 45 thousand gallons. Two years ago, $2.90. Three years ago, $2.95. Four years ago, $3.16. If you want to go back a little further, one year it was $3.46. I don’t know where oil is going. Maybe it will stay down. I don’t think, though, that if the stock market is predicated on going down because of oil that that is going to last. I base this on a three year average. If we have a particularly cold winter, I’m going to run short. If I have a warm winter like this year, I’m going to have excess. But I better be able to cover it. If you cut a budget as this gentleman asked, I’ll have to take it from some other account to make it work, he said.
(35:05 elapsed)
Joe Cummins stated that last year was $3.13, 18 months ago. This current year we’re paying $2.25. It has become fashionable for everyone to disclaim the ability to predict future stock and oil markets. All of those arguments fall to the floor as ten or so school districts are using $2.25 or thereabouts. How is it that their three year averages, or one year averages, or five year averages, are coming up with $2.25? That point puts to silence any argument about people carelessly zooming by gas stations and seeing $1.50. I reject that argument that people are going by gas stations and picking a price out of thin air, he said
It grieves me to have a reduction, Mr. Cummins said. Is $3.19 or $2.90 the right price? This amendment seeks merely to correct an understandable clerical error. Mr. Cummins stated that he has been an admirer of Mr. Katkin for ten years. He is an incredible man, he does a tremendous job, Mr. Cummins said.
(37:15 elapsed)
Randy Crapo moved the question. Mr. Hickson seconded the motion. The motion passed.
Moderator Eaton called for a vote on the $4305 reduction. The motion to amend failed.
There being no further discussion, Moderator Eaton ordered Article 1 to appear on the ballot as amended.
Article
2: Wedgewood Farm Expendable Trust
($60,000) (38:36
elapsed)
School Board Member Kate Hillman moved to restrict reconsideration of Article 1. Mr. Marion seconded. The motion passed.
Ms. Hillman stated that they had raised $60,000 extra from donations. It is misleading as written, but that was required. This money has already been raised. They are not asking the Town to raise any more money, she said.
Mr. Katkin stated that, when the warrant article was originally submitted, it had said that the money would be coming from donations. It was submitted for a pre-review by the Department of Revenue Administration. They said that an expendable trust cannot be funded from donations. Those have to go to the unassigned fund balance and from there to the expendable trust, he said.
School Board Chairman Scott Marion stated that they had had a phenomenally successful fund raising effort to obtain money for the Wedgewood land which sits behind the School. A similar tract of land was donated by Alex Herlihy to give the school almost three acres of land to be used for education and science. We still need to fence the land and do trail maintenance. In order to continue to use this money we need the trust as otherwise no money could be spent after June 30 of the school year. He publicly acknowledged Mae Bradshaw, who was present, for her pro bono service providing legal service in connection with the land acquisition. There was applause.
Peggy Balboni, 40 Red Mill Ln., asked whether they were thinking about raising more funds or whether this was the end. The response was inaudible. She then asked whether there was a line item in the budget for Wedgewood Farm.
Mr. Katkin stated that there is not because of the expendable trust. There is a line item to accept transfers from that when expenditures are made, he said.
Ms. Balboni asked whether this was money for the fence.
Mr. Marion responded that it was more than enough to do the fence. As to raising money in the future, he is hoping that it will not be needed for a while, however teachers may apply for grants, he said.
Joe Cummins thanked the School Board for everything that they had done with the project. He asked Mr. Katkin whether he knew what the legislature’s purpose was in preventing funds from donations from going directly into an expendable trust.
Mr. Katkin responded that he did not.
Phil Winslow moved the question. Mr. Hillman seconded. The motion carried.
Moderator Eaton ordered Article 2 to appear on the ballot as written.
Mr. Hickson moved to restrict reconsideration. Mr. Hillman seconded. The motion passed.
Article
3: Expendable Trust for unanticipated
heating oil expenditures ($10,000) (46:43 elapsed)
Moderator Eaton read the warrant article.
Joe Cummins stated that he believes that it is necessary and that he did not want to rehash what was said earlier about reducing the oil budget. He related how he had been talking with his car mechanic. His mechanic related how money had been raised for textbooks and was then used for substitute teachers. His mechanic volunteered that that was why expendable trust funds are needed. Mr. Cummins stated that he was grieved that people would be wedded to an arithmetic error. The existence of the arithmetic error and the fact that the majority had voted to memorialize it underscores the need for the expendable trust fund, he said.
(48:55 elapsed)
Peter Crawford stated that he agreed with Mr. Cummins. This could be very useful for the School District. We are starting by proposing $10,000. It’s a fairly small amount because the argument could be made that if it might not pass, and our original intention was to cut the budget in an amount in an amount equal to the expendable trust. That is not going to happen but we still think that this is a useful tool and, once established, it could be added to in future years. There are other expendable trusts that the School District has. There is about $100,000 in an expendable trust for special education, which could be used if some students move into the district and there’s a sudden need.
Mr. Marion added that it would need to be unanticipated. Mr. Crawford agreed and noted that the heating oil expendable trust was also for unanticipated costs. He said that the language of this expendable trust is modeled on the tuition expendable trust that still has about $1500 in it. It had about $100,000 in it which was voted in three or four years ago. It was since pulled down to pay for tuitions. There’s another $160,000 in a building and grounds expendable trust. This is consistent with other things that the School Board has set aside money for, Mr. Crawford said.
In a year like this one, if it could have been assured that this would have passed we would have picked a number like $50,000 and tried to take $50,000 out of the budget, which we believe is the order of the over budgeting on the heating oil given the current price of $1.50 to $1.70 vs. the $3.19 budgeted and the usage of 40,000, Mr. Crawford said.
To Mr. Katkin’s earlier point that any money not spent would go back to the taxpayers, there is now, in the unassigned fund balance, $297,000 some odd dollars that has not gone back to taxpayers, Mr. Crawford said. This was voted in. I voted for it myself. It allows the School District to keep 2.5 percent of the District Assessment in the unassigned fund balance, and not return it to taxpayers. So two things could happen. It could go into that account or it could get spent on something else. I noticed that there were some early retirement incentives back in 2013 or 2014 that were spent out of extra money that existed in the budget, he said.
Mr. Crawford argued that it is important that the voters see what they’re voting for a not have something pop up that they didn’t vote for and have the School Board vote to spend money on something that they hadn’t appropriated for. There’s really no limit, within the overall budget, of the extent that the School Board can do that. We think that the best alternative is to budget the heating oil at the current price and put any reserve that’s needed to handle oil price shocks in the expendable trust. This is just a first step, he said.
Mr. Brandon moved the question. Mr. Crapo seconded. The motion passed.
Moderator Eaton ordered Article 3 to appear on the ballot as written.
Adjournment (53:20 elapsed)
Moderator Eaton reminded everyone to vote at the primary the following Tuesday and at the Town Election on March 8. Both will be at the Rye Elementary School from 8:00 a.m. to 7:00 p.m.
Paul Goldman asked the Budget Committee members who were present to meet with him and Jim Katkin after the meeting. We want to understand the process of what we need to do, given that we don’t have a voting majority here, he said.
Scott Marion stated that the School Board meeting, which was noticed for 7:00 p.m., will start right after the Budget Committee meets.
Moderator Eaton adjourned the meeting, thanking everyone for keeping it so short.