Audit shows increasing deficit

School Board to set meeting with towns regarding subsidy

Education assessment results
By Beth A. Birmingham | Oct 23, 2017
Photo by: Beth A. Birmingham Waldoboro Town Manager Julie Keizer addresses the RSU 40 Board of Directors Oct. 19 regarding their handling of state subsidy funds.

Washington — Town managers from Union and Waldoboro, as well as selectmen from Waldoboro and Washington, pressed Regional School Unit 40 board members and administrators for a meeting to thoroughly discuss the district's handling of nearly $600,000 in additional state subsidy it received for this fiscal year when the RSU 40 board met Oct. 19 at Prescott Memorial School

After sitting through nearly an hour and a half of other items on the agenda, Waldoboro Town Manager Julie Keizer addressed the board, reiterating her statement from the Sept. 21 meeting that communication must be improved.

Keizer had requested a meeting between the board and town representatives to help better understand each other's thoughts on the matter.

"We're all playing for the same team, but sometimes I think we forget that," Keizer said, adding, "We're all playing with the same taxpayers' money."

"I don't see what harm it could do, I only see it as a benefit," she said of having a meeting.

Board member Sandra O'Farrell agreed there should be a sit-down, but also reminded attendees that the public is always invited to attend the district's budget meetings.

"It's not like we're hiding anything," she said.

Board member Guy Bourrie suggested a meeting with the entire board would be rather cumbersome, and motioned that the board give Chairman Danny Jackson the power to meet with town representatives to speak on behalf of the board, and after amendments were made, Superintendent Steve Nolan and Business Manager Karla Miller were added to the meeting.

When board member Erik Amundsen suggested having several meetings, Keizer welcomed it, but said, "This is not something that is going to die -- I only see it as a bigger issue down the road."

"We are here for the children of the district -- that's our priority," Amundsen said. "I think the board interpreted it correctly and voted on it."

Board member Emily Trask-Eaton addressed the town managers present, reminding them of what the district audit revealed earlier in the meeting ... the fund balance is only going to increase, thus creating the need for those funds.

She said if you break it down, if 50 percent of the subsidy were returned to the towns, it would only result in maybe a $5 break per taxpayer.

"We're not talking about a $100 refund to taxpayers," she said.

Keizer reminded the board that the issue is not about the amount of break to the taxpayer, it is the decision the board made without communicating with the towns.

Each of the municipalities served by RSU 40 was sent the following email regarding the subsidy:

"As you know, RSU 40 received notification from the Maine Department of Education that we will receive an additional $590,526.59 in State Subsidy for the fiscal year 2017-18. We were advised from legal counsel that there are three (3) options of what to do with the extra money:

"1) Have the board vote to let the $590,526.59 roll into fund balance at the end of the fiscal year,

"2) Have the board vote to use 50 percent of the increase ($295,263.30) to lower the local contribution from each of the towns and the remaining $295,263.30 roll into fund balance at the end of the fiscal year. The amount that would be returned to each town, using the cost sharing formula, is as follows: Friendship $37,251.60; Union $43,721.41; Waldoboro $104,863.64; Warren $78,643.38; and Washington $30,783.27

"3) Have a budget committee meeting, district budget meeting and possible budget validation referendum, returning more than 50 percent of the subsidy increase ($295,263.30) to the towns to lower the local contribution and/or decide what warrant article(s) to increase or let the remainder of the extra subsidy roll into fund balance.

On Aug. 3, the School Board voted to let the entire amount roll into fund balance at the end of the 2017-18 fiscal year.

At the Oct. 19 meeting, O'Farrell motioned to move the question, and the request for a meeting with Jackson, Miller and Nolan and town representatives was approved.

A date has yet to be set.

"I am hopeful that once we sit down and have a full conversation with the entire board that we can explain the whole situation to them," Jay Feyler, Union Town Manager, said in an email Oct. 20.

He said it is the business manager's duty to fully explain the bill, "however, when you can instantly reduce your deficit by $500,000 plus, why wouldn't you?"

District Audit

Auditors from Runyon Kersteen Oullette did not have much to report on the 2016-2017 audit, except for the deficiency in the district's fund balance.

"As you can see, instead of it [the fund balance] being above the zero, it's below the zero," Hank Farrah said to the board.

He explained that in 2017 the fund balance deficit was nearly $580,000, which does not take in summer salaries -- an increased deficit from $197,000 last year.

Farrah noted school lunch and adult education as two of the primary culprits.

"When you take the deficit in the school lunch, the deficit in the adult ed, and the deficit in the general fund, you're looking at a total deficit of $1 million," he said.

Farrah explained that if the district keeps using the fund balance, it is going to run into cash flow issues.

All things considered, Farrah said, if operations continue in this direction, the district will most likely be looking at a $1.6 million deficit overall next year.

When asked if there were any suggestions on how to fix it, Farrah said the most unpopular answer is to cut out raises.

"You're probably not going to be able to cut it out in one year," he said, "You're going to have to come up with a game plan to deal with it over the course of a few years."

Maine Education assessment results

Kimberly Schroeter, director of instruction, reported the results of RSU 40's Maine Education Assessment -- which varied in English Language Arts, Mathematics and Science.

Schroeter explained that since 2009, the state assessment has changed several times.

In 2009 through 2013, grades 3 through 8 were given the assessment using the NECAP {New England Common Assessment Program} standards.

Then the state left those standards and adopted the Common Core standards in 2015, which were more challenging than in previous years and did not include a writing assessment, according to Schroeter.

Schroeter said none of the grades attained the national level assessment that year.

"I didn't like it," Schroeter said, adding that, in 2016, they adopted another assessment called eMPower -- which was used both in the spring of 2016 and 2017.

The only subject to maintain the same assessment throughout has been science, according to Schroeter. And scores were the least changed, with third-grade students scoring an average of 59 percent to 61 percent from 2012 to 2017 and fifth-graders averaging 70 percent to 53.49 percent for the same period.

She also mentioned that from 2009 to 2013 the assessments were written, whereas from 2014 on they were done on computer.

Board member Lynda Letteney referenced an article she read in The Portland Press Herald, which she felt was extremely damaging to the district.

"It ranked Medomak the lowest in the state," she said.

"For all the money we spend on literacy coaches and other stuff ... I don't understand what we are not doing to bring these up," Letteney said. "We shouldn't be last in the state."

Students are improving, Schroeter said, "but there is still this pocket of kids that aren't getting proficient."

She added the problem with math isn't the program, it's the fact that parents don't understand the new math.

Following the progression of third-grade students in mathematics from 2009 to 2015, average scores went from 53 percent down to 22 percent, whereas fifth-graders averaged 65 percent to 54 percent from 2009 to 2012. From 2011 to 2017, average scores decreased from 52 percent to 16.92 percent.

It was stated that the teachers are learning they have to teach differently.

RSU 40 serves the towns of Friendship, Union, Waldoboro, Warren and Washington.

Courier Publications reporter Beth A. Birmingham can be reached at 594-4401 ext. 125 or via email at bbirmingham@villagesoup.com.

Hank Farrah, standing, left, auditor with Runyon Kersteen Oullette, talks about the deficit in the RSU 40 fund balance at the board's Oct. 19 meeting. (Photo by: Beth A. Birmingham)
Kimberly Schroeter, director of instruction for RSU 40, left, talks about the Maine Education Assessment results. (Photo by: Beth A. Birmingham)
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