SEE YOU IN COURT! - September 2017

The ongoing State budget stalemate has many public officials in Nutmeg on edge.  “How can we give the Board of Education money when we don’t even know whether and when the State will give us our ECS funds?” asked Seymour Dollars, the irascible Chairperson of the Nutmeg Board of Education.  Fortunately, the question was rhetorical, because the Town has approved the budget for 2017-2018, including the annual appropriation for the Nutmeg Board of Education.  But Town officials found an outlet for their anxiety -- bird-dogging the Board of Education over its expenditures. 

Last week, the Nutmeg Board of Education received an “invitation” from the Board of Finance to attend its next meeting for a “Discussion of combining Town and Board non-educational services for greater efficiency.”  Mr. Chairperson promptly called Ms. Superintendent.  “Call Mr. Board Attorney,” Mr. Chairperson requested urgently, “and find out if we can ignore this summons.  You know that Seymour and the Board of Finance will be trying to take over the Board of Education with a bunch of intrusive proposals for ‘oversight’ and ‘coordination.’”

Ms. Superintendent did call Mr. Board Attorney, who sagely told her that the Board “could” ignore the invitation, but “shouldn’t,” reminding her unnecessarily that the Town holds the purse strings.  Ms. Superintendent responded that she hoped that Mr. Board Attorney wouldn’t be billing the district for that unhelpful advice, and then she got back to Mr. Chairperson, telling him that he is on his own.

Ultimately, Mr. Chairperson conveyed the invitation to the entire Board, telling them in a confidential email that “we’d better play nice and listen politely to Seymour’s stupid ideas.”  Surprisingly, however, at the meeting, Seymour and the Board of Finance was well-prepared, and they made a number of suggestions worthy of consideration.  The most significant proposal was that the Town would take responsibility in its budget for the medical costs for Board employees.  Seymour explained his reasoning to the members of the Board of Education as follows.

“Medical costs are volatile, and there is no way to budget accurately for such costs.  With medical costs in the Board budget, the Board has to struggle to find the money when medical costs are higher than estimated; conversely, when medical costs come in lower than estimated, the Board of Education gets a windfall.  But if we agree to put these costs in the Town budget, the Town can deal with cost variations through a special revenue fund that the Town will maintain year to year.”

The Board members were surprised at the simplicity and logic of Seymour’s proposal, and they were pretty sure that windfalls from lower-than-estimated health insurance costs were a thing of the past.  As the meeting was ending, they thanked Seymour, and they agreed to give careful consideration to Seymour’s suggestion. 

That night, veteran Board member Bob Bombast had second thoughts, and he sent an email to his fellow Board members, cautioning them against trusting Seymour and warning them that this “incursion” into Board operations would be a bad precedent.  Other Board members weighed in, expressing similar sentiments.  Reading the tea leaves, Mr. Chairperson then wrote to Seymour to say that the Board would keep medical costs in its own budget, thank you very much.

In so responding, did the Nutmeg Board of Education act legally?

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While the Board’s decision was legal, the way it made the decision was not.  Bob’s email and the ensuing “discussion” among Board members constituted a private, unposted and thus illegal meeting of the Board of Education in violation of the Freedom of Information Act.  However, Seymour’s idea raises issues worthy of elaboration.

By way of background, in recent years the General Assembly has amended Conn. Gen. Stat. Section 10-222 several times, which amendments have given municipalities a greater role in board of education financial decisions. 

In 1998, the statute was amended to permit boards of education to authorize other persons (such as the superintendent) “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.”  Moreover, as amended, the statute further requires that the transfer must be announced at the next regular board meeting.  This “authorization” clarified and underscored the ongoing board of education duty to monitor the budget and make line-item transfers as the year progresses to avoid deficits in any line items in the budget.

In 2013, the General Assembly amended the statute again, further involving municipalities in board of education financial affairs.  First, now when a delegate makes a transfer (rather than the board of education itself), the board of education must provide the municipality with a written explanation for the transfer  More significant, the amended statute now provides that, as part of the annual budget process, the municipality (acting through its fiscal authority) shall “make spending recommendations and suggestions to such board of education as to how such board of education may consolidate noneducational services and realize financial efficiencies.”  The board of education is not required to adopt such recommendations, but it is required to provide the fiscal authority “with a written explanation of the reason for any rejection.”  Notably, in amending the statute, the General Assembly did not define what is an “noneducational” service, leaving unclear the scope of the fiscal body’s authority to make such recommendations.  

In the 2017 legislative session, the General Assembly again addressed the issue of noneducational services, but again it did not define the term.  Public Act 17-68, § 12, provides that local boards of education may now enter into written agreements with the local fiscal authority “to take responsibility for the provision of any noneducational services being provided by such board of education.”  The need and/or purpose of this new provision is not clear.  But even if one considers this new statutory provision a clarification of existing authority, caution is warranted.  There may be good reasons for a board of education and the fiscal authority to enter into such an agreement.  For example, having municipalities assume responsibility for medical costs may be a good idea, for the reasons described by Seymour.  However, in making such an agreement, boards of education should strive to keep the related expenses in the board of education budget and to arrange to pay the municipality from its appropriation for assuming such responsibility.  If the board of education simply permits the town to move the expenses to the town budget, later it will be between difficult and impossible ever to move those funds back to the board of education budget if the board of education later wishes again to exercise control over such expenses.