Thursday, March 31, 2016

MERSD FY17 Budget Built on Firm Financial Footing

MERSD began the FY17 budget cycle in a stable and improved financial position due to careful fiscal management and strong support from Manchester and Essex residents.  In FY16, taxpayers provided a one-time revenue correction to make up for nearly a decade of enrollment growth that far exceeded the constraints of Proposition 2.5. As a result of the taxpayer approved revenue correction in FY16, MERSD is on a much firmer financial footing, and no longer has to use rainy day reserve funds to support its annual operating budget.  MERSD has also taken significant steps to address long-term financial liabilities, including the cost of mandated health insurance for retirees (known as Other Post-Employment Benefits or OPEB).  As a result of a collaborative effort with the Manchester Essex Teachers Association, which agreed to migrate staff to less costly plans, MERSD is now on a path to full funding, with an estimated $770K set aside in trust through FY17, funded entirely by savings from employee benefits restructuring.   Additionally, through recent refinancing of existing bonds from the Middle High School project, MERSD stands to save the taxpayers an estimated $1.3 million dollars ($75,000 annually) over the next fifteen years.

The FY17 operating budget assumes spending growth of $722K, or just 3.1% more than FY16.  The resulting assessment increase to the towns is a 3.3% increase from FY16, due in part to a slowdown in state aid, which provides MERSD’s other main source of funding.  Spending growth, excluding the cost of health insurance and OPEB contributions, is just 2.2%.  Town payments in the FY17 capital budget, which pays for debt service related to construction of the Regional Middle High School, are declining $61K, or 2.6% from the prior year. 

Through the ongoing in support of the community, MERSD continues is reputation of strong academic achievement, high quality faculty, a commitment to small class size and a robust co-curricular program.  Throughout 2015, MERSD continued to make progress in fulfilling its goals as outlined in the Strategic and District Improvement Plans.  Highlights include continued academic excellence ranking number sixteen on Boston Magazine’s best districts list, recognition as a model district for the implementation of the newly revamped educator evaluation system, implementation of the Youth Risk Behavior Survey to assess the social emotional needs of students,  the successful negotiation of multi-year teachers’ contract, and continued development of programs and systems to support the belief system of whole child education.