The Montclair Board of School Estimate held an informational session on November 29 to explain to the public how the process of crafting a budget is carried out. Montclair Business Administrator Emidio D’Andrea explained that there would be no votes taken or decisions made at the start of the meeting. The purpose was to look at the most important elements of the budget – mainly health benefits and capital expenditures – and show how they are addressed.
Ryan Tola of the Doyle Alliance Group, a consulting firm specializing in health benefits, gave a presentation on that subject. He explained that there were five benefits plans in place. There are 542 enrollees in the point of service (POS) program, more than the other programs put together; 63 paraprofessionals are in a special Para EPO program, and 31 employees chose OMNIA, which Tola said helped save the district in premiums, as the OMNIA plan is priced at 25 less than the POS plan.
Tola said the Doyle Alliance Group looks at the health plans and reviews them for budgeting six months in advance, preparing details bid specifications that include questionnaires for plan members to address the qualitative issues before any changes are recommended. The data is to be evaluated and financial models and plan comparisons are given to the district for review, with renewal negotiations based on the results. The objective, Tola explained, is to get quotes for “equal to or better than” the current plans per a collective bargaining agreement. The 2016-17 annualized Blue Cross medical/prescription premiums were to $15.6 million versus $17.4 million for the Horizon state plan; the initial renewal premium with Blue Cross for 2017-18 was set at a 14 percent increase, but Tola’s firm managed to negotiate the increase down to 8.7 percent. The overall savings from the initial renewal offer was $844,658.
Tola said preparations for the budget would begin soon, and he expected to meet with the business office and update comparisons to the state plan.
On the subject of capital improvements, Greg Somjen of the architectural firm Parette Somjen addressed the condition of the buildings in the Montclair School district, noting that most of the structures are at least a hundred years old; the Charles H. Bullock School, constructed in 2010, is an outlier. Parette Somjen recommended that up to $20 million be set aside over three to five years to address necessary repairs and improvements, with an emphasis on improving accessibility to the buildings, upgrading the doors and windows to keep the interiors comfortable, and mechanical and ventilation upgrades. State Education Department regulations require competitive bidding for projects, and Somjen made it clear that hiring local contractors would not be possible unless they could offer competitive bids.
In response to a query from First Ward Councilor William Hurlock, Somjen said his firm had not yet prioritized the individual projects on their list, though they have started to talk with the administration about what should be prioritized. He said that the list of projects, compiled in a binder – which he joked was recommended reading for anyone with insomnia – was a “living document” that reflected the need to keep the district’s facilities upgraded. Board of Education member Joseph Kavesh asked if certain projects were more challenging, and one of Somjen’s partners cited deteriorating terra cotta trim was falling from the walls of Buzz Aldrin Middle School as one example. D’Andrea said that there were other projects that required immediate attention, like the track at Fortunato Field, for safety reasons.
John Eschmann, the district’s new facilities director, acknowledged he had his work cut out for him, but added that he trusted the Parette Somjen firm to provide expert guidance. Eschmann also said no one can know what’s going to happen with the district’s infrastructure, but he said he was ready to be prepared to respond to anything, and that diligent maintenance would enable to district to save money. He vowed his goal would be to keep the buildings “warm, safe and dry.” Montclair Mayor Robert Jackson, who chairs the Board of School Estimate, said he was inspired by Eschmann’s enthusiasm, noting also that Parette Somjen’s document on capital projects “shows where we have to go, and that the challenge was to figure out how to get there.
D’Andrea gave an overall view of finances, observing how the district had held the line on taxes during 2012-13 and 2013-14 and had relied on the fund balance. Taxes to fund the schools have been increased by 25 percent in the previous ten years, generating an additional $22 million in revenue.
De’Andrea explained that in the district, now well into 2017-18, is at a point where it is at the required two percent of expenditures being used as fund balance, so going any further into its surplus is not an option. “We have to be careful in that regard,” he said. Special-education spending is a big driver of the budget going forward, while spending on extracurricular activities has decreased. Mayor Jackson had earlier asked if anyone had looked into how much additional money the district could get from the state if Governor-elect Phil Murphy is able to fully fund the school formula. He heard that it would be between $5 million and $7 million, and D’Andrea said he had heard similar numbers. The mayor said that any additional school funding should go toward capital spending.
There are no Board of School Estimate meetings scheduled before its regular review of the 2018-19 budget in March, but Board of Education President Laura Hertzog offered the Board of School Estimate members from the township council any information they might need on the budget, and Councilor-at-Large Rich McMahon said that it would help to get it sooner. Hertzog said that the council representatives should have and take the time to think about questions for the school board. The tentative budget is scheduled to be adopted by the school board on March 8.