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Wednesday, April 27, 2011

What would a contingency budget mean in B-P?

Question: If the current budget is voted down by the taxpayers, what would a contingency budget mean regarding the tax levy. Many times, the contingency budgets can create a higher tax increase , as would be the case in the Amsterdam district this year. Taxpayers should be aware of the process should the current budget get voted down.

Answer: In the event of a defeated budget, the board of education would have three options:
  • Put the same budget before the voters a second time;
  • Put a revised budget before the voters; or 
  • Go directly to a contingent budget.
If a second vote is held and the budget is again defeated, the board must adopt a contingent budget. According to state law, Broadalbin-Perth – like other districts throughout the state – would need to limit its spending increase to 1.92 percent for the 2011-12 school year under a contingent budget, which is 120 percent of the Consumer Price Index (CPI).

The proposed budget for 2011-12 carries with it a 1.64 percent spending increase, which is $240,000 below the state-regulated contingency budget cap.

However, certain expenses that are included in the budget cannot, by state law, be included in a contingency budget. These expenses include student supplies, some student field trips, certain equipment purchases, some salary increases and community use of facilities.

Therefore, if the board adopted a contingent budget, an additional $12,000 in budget reductions would have to be made in these areas. This would mean that B-P’s contingent budget would carry a 1.59 percent spending increase.

Items exempt from a contingency cap are tax certiorari settlements, debt service and costs associated with enrollment growth.

Under a contingent budget, the tax levy increase associated would still be 4.88 percent, which is the same as what is outlined under the proposed spending plan.
-answered by Stephen Tomlinson, District Superintendent

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