Dracut facing budget deficit in fiscal 2025
Estimated at $2.2 million
DRACUT >> Not for the first time in recent history, Dracut faces a substantial budget deficit as it prepares for the upcoming fiscal year, which starts July 1, 2024.
A decade ago, budget deficits brought layoffs as well as service and program cuts. In 2012 and 2013, many teachers and other town employees lost their jobs due to a budget deficit.
At a contentious Triboard meeting on Sept. 26, Town Manager Ann Vandal estimated the fiscal 2025 deficit would be about $2.2 million.
Vandal was clear that the figure she gave was just an estimate. “I don’t have enough information (to provide an exact number). I will not commit to $2.2 million,” she told the meeting of the Board of Selectmen, School Committee and Finance Committee.
Vandal said, “We’ll do the best we can to close that gap with scouring the budget and looking for additional revenues of some kind.”
Before she can give a precise figure for fiscal 2025, Vandal said she must know how much local aid the town will receive from the state and what the state will determine is an adequate funding level for the town’s schools — its foundation budget.
Fiscal 2025’s budget deficit is just the beginning of years of deficits, prompting Finance Committee Chair Alyssa Nazzaro to urge the boards “to take a look at the broader picture and stop nickel-and-diming the budget.”
Under Chapter 70 of state law, the state sets a foundation budget for each school district defining what the state will provide in reimbursement to the district and the amount the town must provide above those funds to meet minimum education requirements. Many municipalities budget more than the minimum.
Chapter 70 allows a municipality to charge back to a school district the cost of nonoperational budget items; that is, line items that do not support a school department’s core functions. For example, teachers’ salaries are operational costs, but student transportation is not.
Vandal said, in light of the town’s projected deficit, “We have to look at the chargebacks. I know that’s not the most popular thing, but the schools have to pay their fair share.”
She added, “Those chargebacks need to be amended to meet today’s needs.” The town and the School Department have a signed agreement detailing allowable chargebacks. Any changes to that agreement would require approval from the state Department of Elementary and Secondary
Education.
School Committee member Renee Young challenged Vandal’s statement and the town’s ability to expand what it can charge back to the School Department.
Young said she was speaking for a majority of the School Committee.
“We are not going to agree to change that agreement. Putting all your eggs
in one basket is foolish. We will not have to agree to taking $2.5 million in chargebacks,” Young said, using the figure of $2.5 million instead of $2.2 million.
Vandal said, “We will always meet net school spending.”
Young fired back, “Fudging the numbers to meet net school spending is disingenuous.”
Assistant Town Manager Victor Garofalo intervened. “Normally, this wouldn’t be an issue. It wouldn’t be an issue if we didn’t have such a tight budget,” he said. “Most communities meet net school spending or even above net school spending.”
The town has to meet its net school spending, Garofalo said. “But to do that, something has to suffer and it’s going to be the town side. And that probably means [Department of Public Works], public safety, library, [Council on Aging]. There’s no other way to do it. We can’t underfund net school spending. So we need to look at some things that aren’t being done and chargebacks is one of them.”
“Or an override or fee increases,” Young said.
Dracut defeated a Proposition 2½ tax override during its budget crisis in 2012 because School Committee Chair Allison Volpe said the town boards were divided.