Andover withdrawal: For SAD 44 "There's a lot at stake here."
“This is going to have a fiscal impact on SAD 44 … There's a lot at stake here. This requires my careful attention, David’s, and a very thoughtful approach to do what’s fair for the taxpayers of the district who you represent, and as importantly, the students who you represent and whose education you care about.”
SAD 44 legal counsel Bill Stockmeyer of Drummond Woodsum did not attach dollar amounts Monday in an hour-long presentation to the School Board about Andover’s school withdrawal agreement proposal.
But he made it clear that he believes significant changes should be made to the plan to minimize a negative financial and educational effect on the district should Andover vote to leave.
“My reaction is that this agreement is quite favorable to Andover,” Stockmeyer said. “That’s to be expected.”
The proposal, prepared by the Andover Withdrawal Committee, provides a detailed plan under which the town would establish its own independent school unit, educate elementary students at the Andover Elementary School, and tuition older students out of town to SAD 44 and possibly other school units. (For highlights of the proposed agreement, see last week’s Citizen.)
Although the terms of the agreement will be subject to negotiation between the two parties later, Stockmeyer said a decision was made to start with a public presentation “and let Andover and the public know where we are coming from.”
His first point of concern regarding the Andover plan was the timeline set for withdrawal. Andover has proposed a vote this spring with an effective withdrawal date of July 1 of this year, should the required two-thirds majority of town voters approve the final plan.
He said he believes the timeframe is too short to accommodate the SAD 44 budget cycle and to ensure a fair agreement that does not compromise the district’s interests.
SAD 44 can’t propose its annual school budget for voters – usually voted upon at a district-wide meeting in late May – until school directors know whether to budget for Andover as in or out of the district, he said.
Stockmeyer also said the Maine Department of Education, which oversees and must approve the withdrawal plan, told him a town in that situation realistically should have a referendum in November in order to have time to get its own steps done, including electing a school committee, hiring a superintendent and setting a budget, in time for the following July 1.
Stockmeyer said a better timeline would be to set the agreement to take effect July 1, 2014.
“I expect this is going to generate a lot of heat,” he said.
But, he said, the district should ask Andover to set “milestone” dates for steps to be completed, and show how the process can be accomplished on the timeline the town has laid out.
“In any case, it needs to allow time for us to have our budget referendum, starting in May,” he said. “It’s not so much our goal to have [Andover] stay an extra year, we just don’t think it can be done.”
If Andover presented its plan with such milestones to DOE, he said, “I don’t think the DOE will approve it.” He said he believes the DOE would want a town school committee elected before hiring a superintendent and crafting a budget.
The current plan would allow the withdrawal committee to temporarily serve in such capacities.
“I could be wrong on [the DOE response],” said Stockmeyer. “The department hedges in telling people what they can and can’t do.”
But, he said, it is in the district’s interest to have time for a budget vote, “and Number 2, that we not all be wasting our time on something that’s not achievable.”
“I don’t expect Andover to agree with that,” he said, but as a compromise he suggested SAD 44 tell the town, “you put in dates that show we have time to do our budget validation referendum.”
As for the particulars of the proposed agreement itself, Stockmeyer found it wanting in several areas, which he addressed in a memorandum and outlined to the board.
“The purpose of this agreement should not reflect Andover’s purposes only,” he said in the memorandum. “It should include as a stated purpose the continuation of educational programming and services for SAD 44 students, and minimize cost increases to SAD 44 taxpayers that the withdrawal agreement will cause.”
Among his specific points:
1. The plan should provide for a 10-year exclusive tuition arrangement (other than for standard exceptions) with SAD 44 for Andover’s Grade 6-12 students, rather than allowing students to elect to enroll, as proposed in the agreement. “Otherwise you run the risk that you’re going to lose significant funding,” said Stockmeyer. He also said the law requires Andover to have a ‘failsafe” contract with a district for 10 years to ensure its students have somewhere to go. In addition, he said the plan should determine a tuition rate that will minimize costs to taxpayers, and consider a debt service factor (if an addition might later be built at Telstar, for example, where Andover students would attend).
2. SAD 44 should not agree to pay special education costs for Andover students enrolled in SAD 44, as proposed. Stockmeyer said that is unfair, and he also cited the example of the cost of a potential out-of-district student placement, estimated at $60,000 to $70,000 a year.
3. Andover seeks to escape school building debt even for Telstar, where its students attend. Andover should pay a share of this debt. The district’s four outstanding construction loans include Crescent Park Elementary School (approximately $263,000, the Nov. 2013 payment having been made; scheduled to be paid off in FY’14); Telstar water/sewer ($400,944); to be paid off in FY’21); Telstar track/auditorium ($852,661; to be paid off in FY’26); Telstar energy/air quality project (approved by the district this year for $1.3 million with a 20-year bond, but Andover did not vote for the project.). “These are obligations incurred on everybody’s watch,” said Stockmeyer.
4. If SAD 44 shares its fund balances with Andover, as proposed, the split should be based on Andover’s percentage of local taxes (6.04 percent) and not the 10.07 percent proposed. Andover should not be permitted to ‘bulk up’ the fund balance with amounts expended on the current energy efficiency project at Telstar, which its students attend.
5. SAD 44 should determine the buses it needs; excess buses can be transferred to Andover. Andover paid only 6.04 percent of local costs but has requested 14.3 percent (four buses) from the fleet.
6. SAD 44 should not “split” some employees with Andover and be required to keep them on the district payroll. The new Andover unit should hire its own.
7. The agreement should not have a termination date, as proposed, of 2026. “It’s like a divorce decree. It’s like a business dissolution agreement. It is what it is,” said Stockmeyer.
He also said in his background comments that Andover would be at a financial disadvantage under state school subsidy guidelines. “For state subsidy purposes, in the current year Andover is counted as having 12.46 percent of the SAD 44 students,” he wrote. “Andover pays 6.04 percent of the local tax burden of SAD 44. The difference is based on the SAD’s cost sharing formula, which is based upon property valuation, an advantage Andover will lose if it votes to withdraw.”
He also said the town would have fewer of its school staffing costs qualify for state funding than it would as a SAD 44 member. After Monday’s presentation the School Board voted to voted to authorize the district’s legal counsel, in consultation with Supt. Dave Murphy, to negotiate on the board’s behalf the withdrawal agreement with Andover Withdrawal Committee, subtrict’s legal counsel, in consultation with Supt. Dave Murphy, to negotiate on the board’s behalf the withdrawal agreement with Andover Withdrawal Committee, subject to approval by the full board. Directors also voted to authorize Chair Lainey Cross to appoint a withdrawal committee of the board to monitor and guide the counsel and Murphy on negotiations.
Stockmeyer will next write a counterproposal for Murphy and the board committee to review before sending it to the Andover committee.
Several members of the Andover committee attended the meeting, but did not speak.
Asbestos; state aid
In other business at Monday’s School Board meeting, directors approved bids from two companies for asbestos abatement at Telstar, as part of the energy/air quality project. Bios Environments will do the actual abatement for $42,793 (additional costs to be by the hour), while Environmental Safety and Hygiene Associates will monitor the project for approximately $33,000.
Murphy also said that an application to the state for a $900,000 loan to possibly fund a new renewable alternative-energy boiler at Telstar had been approved instead for up to $372,619. He said all applications submitted in the state had been funded at 42 percent each. The Facilities Committee will make a recommendation to the board.
Murphy also updated the board on budget-related happenings at the state level that could affect SAD 44 funding. A curtailment order by the governor for the current budget totals under $80,000, and non-essential spending has been frozen. “I’m confident we can make it through the year. We may have to tap the contingency fund,” he said.
The biennial state budget proposes flat funding for education, as well as the sharing by districts in teacher retirement funding. Murphy said if another budget proposal – to suspend municipal revenue sharing – becomes reality, it could indirectly affect SAD 44 by squeezing town budgets.
Murphy also told the board that last Friday damage was done to the upstairs sprinkler system at Telstar High School that resulted in water running through the hallway and down the stairs. The Bethel Fire Department responded and helped district staff in dealing with it. An investigation into the cause is underway, Murphy said.
In a scheduling update, Murphy said the school calendar may be adjusted in March to accommodate staff attending a workshop in RSU 10.
Andover responds to presentation
On Wednesday morning Susan Merrow, chairman of the Andover Board of Selectmen and a member of the Andover Withdrawal Committee, was asked for a response to Monday’s SAD 44 withdrawal presentation.
“It has been made clear to Andover taxpayers that our contribution to SAD 44 is so small in recent years, that the loss of Andover should not be a burden to SAD 44, but a relief,” said Merrow. “So we are unclear why stalling appeared to be the board’s primary tactic for addressing the serious concerns that impact Andover children and the future of our community.
“I hope they will reconsider this strategy. The SAD 44 legal counsel did not make the board aware that the statute sets a 90 day period for negotiations.
“While the majority of towns do get extensions, it sets a guideline for SAD 44 board members to know that this process is not expected to drag out. The data points were in line with our expectations, so we are waiting to negotiate.”