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SEE YOU IN COURT! - May 2011

May 2, 2011

Authors: Thomas B. Mooney

After an acrimonious budget season, the Nutmeg Town Council has set the budget for 2011-2012, and the appropriation to the Nutmeg Board of Education is only 1.5% over last year. With salary increases negotiated in better times, and higher health insurance and fuel costs, $300,000 must be cut for Nutmeg to have a balanced budget.

When the Board met last week, the members asked Mr. Superintendent to recommend reductions. Mr. Superintendent declined, telling the Board that it doesn’t have an expenditure problem, but rather a revenue problem.

“More layoffs are a bad idea,” he told the Board. “Class sizes are already high, and the laid-off teachers would further burden the already stretched unemployment compensation account. But if we can raise additional revenue, we can avoid the cuts. So I have developed the following plan. First, we have a series of fund-raisers at each school. We can ask the teachers to pitch in at each school. If they all bring some baked goods to sell to the kids at lunch, we can make a fortune. We will also have an auction of unused school equipment, and we can earn some serious dollars that way as well. In addition, the rich parents at Acorn Elementary School have even offered to fund our budgeted technology upgrades. It is too bad that we can’t upgrade the other schools at the same time, but we appreciate their support, and we are grateful that these parents are so generous.”

Penny Pincher was not convinced. “My church runs fund-raisers all the time, but lately it has been hard to get anyone interested in spending more money.”

Board member Red Cent chimed in, “I agree with Penny. This is a very tough time, and we can’t be sure that people will contribute. It seems dangerous to rely on contributions at such a difficult time. What is the deal with the unused equipment?”

“We have a gold mine in the basements of our schools. We have old chairs, desks, lamps, tables, all gathering dust. The most amazing thing is a WPA mural we found behind a boiler at the middle school. That alone should bring us $10,000.”

“Wait a minute. That would still leave us with $290,000 to make up,” Penny Pincher responded. “That is a lot of chocolate chip cookies to sell.”

“Don’t be such a Debby Downer,” said Mr. Superintendent with a smile. “We should think positive here. Who is with me?”

The Board members looked uneasy, but they were on public access television, and they did not want to leave their Superintendent hanging out there alone. Veteran Board member Bob Bombast broke the ice. “I’m in. I congratulate Mr. Superintendent on his positive approach to this problem. I think that we can make up the difference if our parents and students dig deep this year.”

“Thank you, Bob. I appreciate your confidence in my plan. If we run into trouble, we can always ask for a supplemental appropriation.”

The Board members winced at that last remark, because Seymour Dollars had already warned the Board that the cupboard is bare and they shouldn’t come back for more money this year. But they shook off their discomfort and voted for the plan.

Do you see problems for the Nutmeg Board of Education in the coming year?

*        *        *

Given its duty to avoid overexpending its budget, the Board is playing a dangerous game. Moreover, it will encounter some legal problems with this plan.

There are a number of legal issues. Boards of education do have the right to accept donations “for the educational benefit of students.” Connecticut General Statutes, Section 10-237(c). Increasingly, parents are organizing non-profit educational foundations to help support the good work of beleaguered school districts, and such foundations can provide meaningful assistance to school districts. In accepting any such support, however, boards of education must be aware of the statutory obligation to assure an “equitable allocation of resources among its schools.” Connecticut General Statutes, Section 10-220. In accepting gifts from parents and even education foundations, boards of education may not accept gifts if significant special advantages would be conferred on one school over the others.

The proposed sale of school property will not help the Nutmeg Board, and it exposes the Board to potential liability. Property used for school purposes is entrusted to the care and control of the board of education. However, ownership of such property remains with the municipality, and boards of education have no right either to sell the property or to keep the proceeds. To be sure, unused property may be a source of revenue (and school officials may want to check behind the boilers for art treasures), but boards cannot act unilaterally in such matters.

The bake sales present problems as well. Boards of education can accept the generosity of teachers and others in these difficult times. But they may not unilaterally impose obligations on teachers and others to participate in fundraising activities. Any such expectations would be a change in working conditions subject to negotiations. Moreover, though it pains me to say so, the Board must consider school nutrition requirements in running bake sales at the cafeteria during lunch.

The biggest problem here is that Mr. Superintendent and the Board are letting their optimistic approach compromise their duty to adopt a balanced budget and to maintain appropriate oversight as the year progresses. In 1998, the General Assembly amended Section 10-222, which deals with the board budget, adding, “Boards may, by adopting policies and procedures, authorize designated personnel to make limited transfers under emergency circumstances if the urgent need for the transfer prevents the board from meeting in a timely fashion to consider such transfer. All transfers made in such instances shall be announced at the next regularly scheduled meeting of the board.” Implicit in this requirement is the duty to adopt a balanced budget and to monitor and make line item transfers as needed throughout the year to assure that the budget is not overexpended.

Finally, the statutes do provide for supplemental appropriation, a process that is perhaps more important than ever. With tight budgets and uncertainties of State funding, boards of education may indeed confront shortfalls this year. Section 10-222 contemplates that possibility and sets forth a procedure for requesting a supplemental appropriation. However, there are no guarantees, and the statute expressly states that no additional funds may be expended unless such supplemental appropriation is made. Thus, in these tight times, close monitoring of the budget on an ongoing basis is essential.

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