Schenectady CFO reports no state budget agreement, flags $4 million federal timing risk

CFO Terry provided a budget update to the Schenectady City School District Board of Education on April 9, reporting that the New York State legislative session had adjourned earlier in the day without a final budget agreement and that district leaders have not changed the district’s proposed budget posture ahead of the May vote.

Terry said the district’s draft budget maintains current programs and staffing levels and that the administration increased the proposed budget by about 1.2% since the last presentation. He said the district is not planning a tax increase at this time and continues to rely on current fund balance and revenue projections to bridge uncertainties while final state aid remains unresolved.

On health insurance, Terry described a substantial premium increase over recent years and provided a five-year history to the board. He said that industry-wide medical and pharmacy cost growth has driven the rise in premiums and that the district is communicating plan contributions and rate sheets to employees ahead of July 1.

Terry flagged two federal funding items that could affect the district’s finances. First, the district participates in the Community Eligibility Provision (CEP) for school meals and is currently above the CEP threshold; Terry said proposed federal changes that would raise the CEP threshold would not remove Schenectady’s CEP eligibility because the district’s CEP rate is about 77%. Second, he told the board the district had approximately $4 million in COVID-era Elementary and Secondary School Emergency Relief (ESSER) or related funds in a late-liquidiation status and that those dollars were at risk pending state-level determinations. "We have $4,000,000 out there," Terry said, describing the late-liquidation situation and that the district is prepared to shift those costs into the general fund if necessary.

Terry said the district has acted conservatively in projecting foundation aid and enrollment and has increased the planned fund balance carryover; he estimated a projected fund balance position sufficient to maintain required reserves while applying planned uses for 2025–26. He also reported that transportation bids were due April 21 and that early results show some vendor interest and potential cost savings.

Board members asked about the late-liquidation exposure and the district’s options. Terry said the expenditures have already occurred (orders placed or services used) and that, if the state does not allow liquidation, the district could transfer the costs into next year’s general fund; he said the district is also monitoring appeals options with the state and that other districts and the state attorney general had been involved in similar disputes. "We would just have to move it over to our general fund if that's the determination," Terry said of the potential $4 million shortfall.

Terry asked the board to expect a line-by-line budget review at the next meeting, a public hearing on the budget on May 7 and a budget vote on May 20. He reiterated that the district is currently projecting no tax increase and is planning to adopt the budget in the next meeting cycle.

Votes at a glance

At the start of the meeting the board approved the consent agenda (items 4a–4g). The transcript records the motion to approve the consent agenda, a call for "Aye," and the chair’s statement that the motion "carries." Specific roll-call vote tallies or names for that motion were not recorded in the transcript.

Ending

Terry closed by saying he would present a detailed, line-by-line budget review at the next board meeting; the board scheduled a public hearing for May 7 and the budget vote for May 20. The district continues to monitor state budget developments and federal grant liquidations that could affect the final reported budget.