Norwalk schools face spiraling costs

CFO: District’s 2021-22 budget faces $10M increase due to wage, insurance hikes

NORWALK — The city’s public school district has not yet unveiled its 2021-22 budget proposal, but the district’s chief financial officer, Tom Hamilton, indicated wage and health insurance increases could result in “significant” additional costs.

Projections show health insurance costs could increase by $6 million, while wage increases are projected to cost the district another $4.1 million.

“We’re scrubbing the budget as thoroughly as humanly possible and identifying areas where savings can be achieved and priorities reordered so we can fund any new initiatives,” Hamilton told the Board of Education’s Finance Committee at a meeting last week. “The purpose tonight is not to release or present the budget in any shape or form. It’s just to give you a heads up. We’re not prepared to lay out actual numbers. It would be premature for us to do that, frankly.”

Hamilton said projections show health insurance costs going up about $6 million, or 8 percent, in the next fiscal year, mostly due to increasing premium costs.

The district is on a state health insurance plan, but Hamilton said the state recently decided to base premium costs on the region. As a result, Norwalk is anticipating a 3.5 percent increase in insurance costs based on projections from its health insurance consultant.

On top of this, more employees are joining the district’s health insurance plan, Hamilton said. About 1,502 are enrolled in the district’s plan. That’s 48 more people than last year and an additional $1.1 million, Hamilton said.

“We are finding health insurance is likely going to be a major driver of next year’s budget for us,” Hamilton said.

In addition, Hamilton said there’s $4.3 million from contractual wage increases and the district adding staff to bring services

in-house that will need to be factored into the budget.

The district also has to consider an additional $1.5 million in this year’s budget that was carried over from the previous year when there was a surplus. Hamilton said the district is not anticipating a surplus this year.

In addition to funding these increases, Hamilton said Superintendent Alexandra Estrella is hoping to add math and literacy specialists in all schools with grades kindergarten through eight. These certified employees would work directly with students to make sure they’re reading at grade level and would help to build math skills.

The district is also focusing on increasing parent engagement, equity, diversity and inclusion.

“There’s a lot of moving pieces,” Hamilton said. “Currently, it’s not settled, but we certainly have a lot of directions we’re moving in.”