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February 25, 2013

School money at risk in Methuen

State says city is not spending enough

(Continued)

But in 2010, the local reporting on spending, under a new business manager and following an outside audit, was done according the state-mandated manner – separating current from retiree. But because of the checked box, the state did not count the now substantial retiree health care costs towards the minimum required spending for that year.

For every year since, that roughly $1.6 million has snowballed into $4.7 million last year, enough to trigger a sanction from the state if the issue is not cleared up before the fiscal year 2014 budget is completed.

“Methuen has been under its net school spending (NSS) requirement for a few years, since FY10,” J.C. Considine, a spokesman for the state Department of Elementary and Secondary Education, said in an email last week.

Kelly said has been working with state officials for more than a year to resolve the problem and get credit for the 2010 retiree spending. Total health insurance spending has gone from $4 million in 2002 to $12.8 million in 2012, he wrote in a letter to state education Commissioner Mitchell D. Chester dated April 27, 2012.

State Rep. Linda Dean Campbell, D-Methuen, said the education department is working on a fix for the Legislature that would help Methuen and the 126 other communities who checked no and may find themselves in a bind.

“We’re very hopeful we are going to be looking at it this budget cycle,” she said.

According to DESE, Methuen spent $64,509,506.20, about $1.86 million, or 2.8 percent, below the state required minimum of $66,364,728 in fiscal year 2010, which ran from July 1, 2009 to June 30, 2010. In fiscal year 2011, the city spent $67,639,208.80, about $3.1 million, or 4.3 percent, under the $70,765,264.80 state minimum.

Those years fall within a 5-percent buffer defined by state law. School systems funded between 95 and 100 percent must carry over the difference the following year. For example, if Methuen funded 97.2 percent in 2010, it must add the 2.8 percent difference onto its minimum spending in 2011.

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