Long Island

Education

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Voters in Oyster Bay and <a href="/topics/Locust_Valley%2C_NY">Locust Valley</a> said they rejected budgets that would have brought 5-percent-plus increases in tax levies and turned out incumbents whom they considered spendthrifts. 
Residents said it's time for school officials to face the same financial reality as the rest of the world. 
Anna Hunderfund, superintendent at <a href="/topics/Locust_Valley%2C_NY">Locust Valley</a>, said the district's first order of business is to revisit the defeated spending plan. 
"There is probably no single answer that can be pointed to as the root cause of our budget failing by a relatively small margin," she said in a statement. "But since the budget is a financial plan, we have to assume that financial issues were a significant driver of the outcome." 
Lisa McLoughlin, 54, a <a href="/topics/Bayville%2C_NY">Bayville</a> resident for 34 years, said she voted against the Locust Valley budget because spending "has been out of control." She said schools try to use "fear mongering" to pressure residents to approve budgets, saying it's for the good of the children. 
McLoughlin has lobbied against the International Baccalaureate program at the district because students can take college-level Advanced Placement courses instead. She voted for school board candidates who said they'd consider cutting the program. 
Phyllis Harrington, superintendent of the Oyster Bay-<a href="/topics/East_Norwich%2C_NY">East Norwich</a> Central School District, said she did not interpret her budget defeat as a message from voters. 
She said administrators were disappointed because the district had tried to be frugal while keeping items in the budget that parents supported. 
Oyster Bay has 172 teachers and support staff and 1,700 students. The district proposed laying off 3.5 teaching positions at the elementary school level, raising class sizes from a low of 20 to a high of 28, Harrington said. The district did not contemplate teacher layoffs at the high school because classes already have 28 to 30 students, she said. 
Grace Searby, an Oyster Bay resident for more than 40 years, served on the school board in the '70s. She voted down the budget and endorsed the two school board challengers, calling the incumbents "big spenders." 
Searby said the district could cut costs by renegotiating the teachers' contract, freezing step increases, cutting professional development and trimming sports. 
"A message was sent to the school board that they did not do their job and did not represent the entire community," Searby said. "Expensive doesn't equal excellent. We could do more with less."

Nassau

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Voters: It's time to get tough on budgets

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Long Islanders have a chance to vote on school budgets and board candidates Tuesday amid the greatest financial challenges for districts in two decades. 
Island-wide, districts are proposing a combined total of $10.8 billion in spending for the 2011-12 school year -- up 2.17 percent from this year. Tax levies, the total revenues raised by local property taxes, would rise 3.96 percent. 
Why the difference between spending and taxes? Mostly, that is due to record cuts in state aid to schools, totaling $206 million. The reduction includes $89 million in federal jobs money that is not being renewed next year. 
Albany lawmakers -- <a href="/topics/U.S._Republican_Party">Republicans</a> and <a href="/topics/U.S._Democratic_Party">Democrats</a> alike -- contend the cuts were essential to balance the state's budget. Gov. <a href="/topics/Andrew_Cuomo">Andrew M. Cuomo</a>, who pushed for the reductions, has added that most districts could compensate for lost aid by dipping into cash reserves. 
The state's teachers union, <a href="/topics/New_York_State_United_Teachers">New York State United Teachers</a>, has responded that Albany should have extended an income-tax surcharge on upper-income residents instead of cutting aid. 
On the Island, school taxes account for more than 60 percent of property taxes. Those bills rank among the nation's highest. 
With so much at stake, many civic activists decry the fact that less than 20 percent of eligible voters typically turn out for school elections. But taxpayer representatives note that school elections provide voters with only limited influence over boards and budgets. 
The School Voters Guide on Newsday.com provide information for all 124 of Long Island's districts. To look up information in your area, click on the name of the town first, followed by the name of the school district.

LIINTR14

Primer for LI school district elections

liBUDGET

Long Island's school districts are saddled with $3.7 billion in long-term debt, the price of years of borrowing for construction and improvements ranging from solar panels and upgraded ventilation systems to science labs, refurbished auditoriums and updated athletic fields. 
While the state picks up part of the tab -- in some cases, the majority of it -- property owners, too, are on the hook for this fixed cost, which is plugged into district budgets already straining under dramatic cuts in state aid and the expense of government mandates. 
School budgets that residents in most of the Island's 124 districts will be asked to approve Tuesday include principal and interest due annually on bonds -- indebtedness that over the past decade was encouraged by state policies. 
Debt service on the Island's school district bonds last year totaled $468.9 million, up from $146.1 million in 1990, according to the state Department of Education. 
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Footing the bill 
As with any IOU, the piper must be paid. 
"The thing you have to consider is, what is the alternative?" said Wendell Chu, superintendent of the <a href="/topics/East_Islip%2C_NY">East Islip</a> school district. "This type of debt that's being picked up is generally for capital projects that are not easy to include in regular budgets." 
The annual debt service is a small piece of a school district's overall spending, which also includes state aid. Last year, debt service ate up 4.5 percent of total expenditures in the Island's districts -- up from 3.1 percent in 2000 and 3.8 percent in 1990. 
In the 1990 fiscal year, <a href="/topics/Nassau_County%2C_NY">Nassau</a> and <a href="/topics/Suffolk_County%2C_NY">Suffolk</a> school districts had a combined $542.6 million in outstanding bonds, according to data provided by the state comptroller's office. By 2010, those bonded debt obligations had grown to $3.7 billion. Adjusted for inflation, that's a 309 percent increase. 
Consider <a href="/topics/Syosset%2C_NY">Syosset</a> as one example. When children were dismissed from <a href="/topics/Syosset%2C_NY">Syosset</a>'s schools in the summer of 1990, paying off the district's long-term debt bonds would have taken about $7 from the pocket of every man, woman and child in the district. In 2010, the payoff was $1,389 per person. The district's bonded indebtedness grew in that time from $225,000 to $47.5 million. 
Increased debt by itself doesn't necessarily mean that school districts are borrowing too much -- indeed, as Long Island became wealthier, it could afford more. Overall school spending grew from $3.89 billion in 1990 to $10.37 billion last year, a 60 percent increase after adjusting for inflation. 
"Just to focus on increases in the amount of debt is just a partial view," said Kate Hackett, an analyst at Standard &amp; Poor's. "You have to look at the growth in the economy. It's a very strong economy out in Long Island." 
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Outpacing inflation rate 
Still, borrowing by many districts has outpaced inflation. The state's growing obligation to fund a portion of school construction and renovation over the past decade prompted changes in law this year that will bring to the fore the trade-off between construction and other costs, such as hiring teachers. 
"New York State has done a number of things over the years to encourage school construction, and some projects were sorely needed and others may have been done because the state's reimbursement was so generous that it was hard to say no," said Morris Peters, spokesman for the state Division of Budget. "The problem with that is it drives up state expenses for school construction." 
In the 1990-91 school year, New York paid school districts throughout the state $380 million for building aid. Twenty years later, that figure had risen to $2.49 billion, an increase of 295 percent in inflation-adjusted dollars. The amount of aid available for eligible projects is largely determined by a district's wealth, with the state paying a greater portion of poorer districts' costs. 
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The borrowing boom 
Borrowing really took off in the new millennium, fueled by a confluence of factors that created fertile ground for debt. Part of it was simply cyclical need. Many Long Island schools were built in the 1950s and required renovation, or more classrooms were needed in growing districts. Enrollment increased during the 1990s and through 2005, driven by a number of factors, including offering full-day kindergarten in more districts and expanded curriculums. Falling interest rates in the 1990s and 2000s made borrowing cheaper, and rising wealth and property values made more money available. 
Observers point to state policy changes that encouraged borrowing: a temporary state increase in building aid, imposition of a payment schedule that spread reimbursement over fixed time periods, and a grant program that prompted sale of more bonds. 
Starting in 1998, the state temporarily increased building aid available to all school districts, prompting many to go out with bond referendums. 
Chu said that state incentives spurred districts to make needed investments in their facilities. 
"That incentive caused a lot of school districts to do those projects -- projects that they may have decided to put off for a later point in time or might have even enhanced projects to allow them to do better things," he said. 
Then, in 2002 the state changed the way it reimbursed school districts so that it paid them over 15, 20 or 30 years, depending upon the type of project, which discouraged pay-as-you-go spending. 
"Governor Pataki, when times were tougher, turned around immediately and stretched out the repayments over the life of the project," said John Bierwirth, superintendent of the <a href="/topics/Herricks%2C_NY">Herricks</a> school district. "In a relatively short period of time, the state was one moment encouraging construction and in the next moment encouraging people to go into debt." 
Finally, a program called EXCEL encouraged districts sell more bonds, though that cost generally fell more on state taxpayers than individual districts. The borrowing bonanza prompted state lawmakers to change the system this year. The 2011-12 budget capped growth in school aid, including building aid. That means as more funds are approved for districts' capital projects, less money will be available for other things. 
"This dynamic has existed for a long time -- of expense-based aid growing as a percentage of the total," Peters said. "Going forward, as we're constraining school-aid growth, that problem is going to essentially be compounded, and this will focus a little more attention on the issue."

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School debt soars on Long Island

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