Members of the Peabody School Committee, Mayor Ted Bettencourt, and Superintendent of Schools Dr. Josh Vadala recently convened for an FY25 school budget meeting at Higgins Middle School, to talk about needed reductions in operating costs and propose changes to funding sources, to adjust to significant decreases in state aid and the expiration of Elementary and Secondary School Emergency Relief (ESSER) funds that resulted from the COVID-19 pandemic, for districts all across the country.
Bettencourt prefaced the meeting, acknowledging that “this is going to be a tough budget.”
“Definitely some increases that were expected and others that were not expected,” Bettencourt said.
Bettencourt said that one of the biggest increases is a 9.95% increase in health insurance, which represents a $1.5 million increase.
“That is the largest, by far, that’s ever hit me in my years as mayor,” Bettencourt said.
Bettencourt also noted that Chapter 70 funds that come from state aid are significantly less than last year and the year before.
“It really put stress on our department heads, Dr. Vadala and his team, and we’re just trying to work through that,” Bettencourt said.
Bettencourt clarified that the state is still working on their final numbers, but that school officials are anticipating a significant decrease in state aid.
For the first tier of reductions, to address the increase in health insurance, Dr. Vadala proposed reducing the health insurance line item by $371,000, which will be offset by having employees that are paid through revolving accounts that generate revenue such as the cafeteria fund, have their health insurance also paid for by the same accounts.
“We feel like that’s something we can do and we’ve identified the funding sources for that,” Dr. Vadala said.
Dr. Vadala also proposed eliminating a new line item representing $250,000, that’s supposed to act as a safety net for costs that are normally not budgeted for, such as teacher severances and other increases, but have not been used in the past.
“We’ve been okay with the way we’ve done business so we would eliminate that line,” Dr. Vadala said, saying that the safety net would’ve been nice to have, but that the district is not in the financial position for it. “That just wasn’t in there last year.”
Dr. Vadala also proposed to decrease $200,000 in funds for homeless transportation because this year, the state agreed to send reimbursements for related costs this year as opposed to next year.
Dr. Vadala proposed other offsets in the technology and Special Education areas, and said that the Peabody Education Foundation has identified donors that will fund areas in Science.
In total, reductions in the budget that are offset by utilizing revolving accounts and other funding sources would result in approximately $1.2 million in savings, bringing the operating budget down to around $97.5 million.
School Committee Members unanimously voted to authorize the Superintendent and Business Manager to make the first part of changes in the budget, with Member Beverley Griffin-Dunne emphasizing that the budget may still change down the road.
For the second tier of reductions, another proposal made by Dr. Vadala was to eliminate the program for teacher fellows that the district has in partnership with nearby colleges and universities, which would result in approximately $136,000 in savings.
“We’re in a good place, we’re maintaining our staff, so we’re not looking to hire a ton,” Dr. Vadala said. “So that is an area where I would be comfortable reducing.”
Dr. Vadala said that there were some reductions that results in the closure of Center School next year, such as the Team Chairperson position for the school, representing approximately $120,000 in savings.
These, coupled with other budget savings through reductions or offsets using revolving accounts, brings the budget down to approximately $96 million.
School Committee Members unanimously voted to authorize the Superintendent and Business Manager to make the second part of changes in the budget.
Bettencourt said that he anticipates some additional cuts, that there will be a couple more meetings at a minimum regarding the budget afterwards, and that other cities and towns are also experiencing difficulties with their school budgets.
