Sachem budget presentation flags rising retirement and insurance costs, $2.7M in short‑term interest

Mrs. Sirakis, presenting the district’s first budget overview of the year, told the Board of Education the district expects salary codes to total about $177 million — a $1.9 million increase that represents roughly a 1.1% rise to the budget. She said salaries, employee benefits and debt service make up the categories the administration can now quantify with reasonable confidence.

"So we're looking at $177 million in our salary codes. It's a $1.9 million increase over the current year, but it is only a 1.1% increase to the budget," Mrs. Sirakis said during the presentation. She described salary figures as contractual obligations set by collective bargaining agreements and said administration will provide detailed FTE and line‑item breakout later in the budget cycle.

The administration told trustees that employer contributions to retirement systems are a key upward pressure. Officials said the Employees' Retirement System contribution is currently about 15.2% and is projected to rise to roughly 16.5% for 2025–26. The Teachers' Retirement System rate is an estimate at this stage and may increase by about 10%, with final numbers due from the state later in the year.

Trustees pressed for additional detail about in‑house pupil transportation staffing and asked for FTE alignments for major budget categories. Mrs. Sirakis agreed to supply more granular line items and FTE counts in the next presentation as the district moves from preliminary estimates to final figures.

Administration also described insurance changes that increased benefit costs. Because a third‑party administrator stopped servicing the district's self‑insured long‑term disability plan, the district said it must purchase a fully insured policy for new claims effective Jan. 1; quotes ranged from about $370,000 to $600,000 and the district selected an insurer whose annual premium was reduced to roughly $330,000. Existing self‑insured cases remain the district’s responsibility.

On debt and cash flow, trustees and staff emphasized the burden of tax‑anticipation borrowing. The district reported debt service of about $16 million and said short‑term tax‑anticipation borrowing required to bridge state‑aid timing will cost roughly $2.7 million in interest. Board members noted those interest costs are the product of state‑local timing mismatches and discussed possible advocacy to address the misalignment.

The administration said it will wait for the governor's state‑aid announcement and tax base growth factors — typically released in late January — before finalizing revenue estimates or a recommended tax levy. Preliminary calculations presented in the meeting showed an estimated budget increase of about $2.879 million at the time of the preview and flagged the possibility that levy calculations with exclusions could push the effective levy rate beyond a simple 2% cap used as one scenario.

The district will return to the board in January with more detailed revenue figures, a run‑rate projection of fund balance, and the requested line‑item/FTE breakdowns. For now, administration characterized the presentation as an early, transparent step to signal major pressures — retirement contributions, insurance changes, and the cost of short‑term borrowing — while precise final numbers remain dependent on state actions.