Joint Finance Committee meeting allows Council to question BoE’s budget

Questions about efficiency study implementation and wasted food marked the first joint Committee meeting this budget season between the Board of Education and Common Council. Also on the docket: some pushback on “wants versus needs.”

“From my experience and working with the city for 51 years now, I find that this is probably one of the most cohesive projects we have, when we work with the Board of Education in the City of Norwalk. In the past, it’s been very contentious. We’ve tried to limit that, we’ve tried to work closely together,” Mayor Harry Rilling said at the outset of the Jan. 11 meeting, noting the collaborative approach he instituted after first becoming Mayor.

“This year is going to be a particularly challenging year because as we know, inflation is so many years high, about 7.5% maybe coming down a little bit. Everything that we purchase is costing more,” Rilling said. “…Couple of years ago, we started talking about wants versus needs. This probably is more important than ever.”

“This whole ‘wants versus needs’ has been going around in circles and it keeps coming up. But we’re talking about educating children,” BoE Chairwoman Diana Carpio said. “…wants versus needs’ in reality for us is no education, to a quality education.”

Norwalk Public Schools has many obligations and much responsibility because “children are our future,” she said. “Also, a good public school system helps with realty, house prices, people want to move here.”

The Board of Education has requested an 8.2% operating budget increase, a total $245,087,744. About 5% of that is needed just to maintain current services, according to Norwalk Public Schools Chief Financial Officer Lunda Asmani. The rest is attributable to continuously increasing Special Education costs, an initiative to lighten the load on stressed elementary school teachers by providing more planning time, school lunch fund deficit spending and a desire to restore magnet school funding.

“Other key drivers include contractual obligations, and student enrollment relative to multilingual learners, or MLL, and special education learners,” BoE Vice Chairwoman Sheri McCready-Pritchett said. “One of the many things that we’re seeing is an increase of students needing specialized services, currently over 15%. At the same time, unfunded state mandates along with the rising cost of services for out-of-district providers, we are seeing an increased stress on our budget.”

She added, “Norwalk Public Schools is the most successful city school system in Connecticut.”

Council member James Frayer (D-District E) offered supportive words. While campaigning, he asked many Norwalk citizens what they liked about the city, and their faces lit up.

“They were talking about the diversity of Norwalk, they talked about the beaches, they talked about the infrastructure of the city, they talked about the fact that the roads are paved, maintenance. They did also talk about the Board of Education, saying that they thought it was a great, great Board of Education, schools are good, they’re very satisfied,” he said. “I think what we have to keep in mind is that we have to maintain that level. One of the reasons why we’re one of the most sought-after cities to live in in the country.”

Nevertheless, it’s taxpayer money and “everything is going to be taken as a whole,” he said.

Financial overview

Director of Management and Budgets Tom Ellis delivered an assessment of current financial conditions.

“It is generally a bit rosier than it was last year. Inflation has reduced, while recession fears have diminished,” he said. “Inflation was 6.5% last year, less than half of that this year, according to the latest statistics in December.”

Ellis said, “Interest rates, though, we may consider very, very high.” Auto rates and mortgages are much higher than people are used to.

The housing market is slow with very little inventory in some places. “I talked to a local Realtor over the weekend. And they said there were 23 houses for sale in Norwalk, which seems incredibly low,” he said.

But the stock market “had an unexpectedly strong 2023, 13% year over year,” he said.

Layoffs continue, though less than last year.

As for local challenges, all of the City’s six or seven unions are up for contract renegotiations, Ellis said. Health insurance is likely to increase around 9% and OPEB (Other Post-Employment Benefits) will probably increase 10 to 12%. Debt service is probably going to be in a 10 to 12% range.

“So, you lock in those items where we have no flexibility, it forces us to take the 3% down for all the other departments where there is some control and variable expenses,” Eliis said.

As a strategy, the City plans to pursue as many grants as it can and “if necessary, explore the option of drawing down the Rainy Day Fund,” he said.

Rilling pointed out that a Rainy Day Fund drawdown has been factored into many recent budgets but “through strong fiscal management, responsible management on our department heads, we’ve not had to really take the money that we put aside.”

“We just finished our audit for 2023. And our Rainy Day Fund went from about 77. 5 million to 78.5 million,” Ellis said. “…We would not make a move without significant consultation with our bond adviser who is very tightly wired to all the bond rating agencies and is familiar with our statistics.”

He was asked if the City has the staff to go after grants.

Norwalk’s part-time grants coordinator “does a good job” finding grants, and the departments that “consistently ask for and get a lot of grants” have very talented people who succeed in capitalizing on the information, he said. “The way we’re structured right now seems to be working very well.”

‘Amazing’ waste

Regarding food service, Assistant Superintendent of Business and Operations Sandra Faioes said, “School lunch is something that is critical to the health of our students.” Not having enough to eat “has been connected to depression and attention. And in many cases, in the areas that are poverty stricken, those students actually perform worse.”

The operating budget request includes $1.2 million to support the free lunch program, which is largely funded through a federal grant, she said.

“If you compare the number of meals that we served pre-COVID, in comparison to the number of meals that we have now, we actually have served over a half a million more meals.” Faioes said. “…We’re actually trending this year, year-to-date, 4% higher than we trended last year.”

But Council Finance Committee Chairman Greg Burnett (D-At Large), while agreeing “lunch is vital to the success of the students,” said he’d been to schools multiple times over the years and watched students throw food in the trash.

“I was amazed, no, I was astonished by the amount of waste of the food,” he said.

“That’s actually disappointing,” Faioes replied. “I think that more recently we have switched vendors to Chartwells. So, if that’s something that you’re seeing more recently, I would love to speak to you about that.”

There’s a federal formula “that all students have to take a certain amount of items in order for it to be counted as a meal. That’s how you get your reimbursement,” she said.

So a student might want Tator Tots but has to take a full meal, she said.

“Chartwells has engaged students in a number of initiatives to make sure that the type of meals that they are experiencing are ones that they’re interested in,” Superintendent of Schools Alexandra Estrella said.

Asmani said NPS has hired a consultant to look at its food service, analyzing whether the district is getting maximum reimbursement and looking for efficiencies.

Efficiency study

Council member Johan Lopez (D-At Large) asked if NPS had implemented recommendations from the efficiency study produced two years ago.

Faioes said NPS had worked with Recreation and Parks to redraw the maps of who was responsible for what on school properties, one of the recommendations made. Norwalk Recreation and Parks Director Robert Stowers is working on a joint agreement she hopes will come for BoE approval soon.

Experts had recommended outsourced service but the City and NPS did a comparative study on sharing contracts, she said.

“Last year, we were successful in upgrading our financial system,” Asmani said. Now the NPS purchasing department and the City’s department “piggyback on each other. Our HR works very closely with the City’s.”

Assistant Superintendent of Digital Learning and Innovation Ralph Valenzisi said the two IT departments are very different, “but there’s a lot of things we can collaborate on.” A joint capital request to upgrade phone systems is working its way through the process. “If it gets approved, then we can actually do the upgrades at both police and fire as well as our systems and our middle and high schools.”

Some efficiency study recommendations haven’t been implemented because they would require adding more staff and therefore add costs, Asmani said. That would involve adding staff.

“This is a really large system with a very small team,” Estrella said.

Consultants recommended staff reduction in communications and that was done, she said.

“The City team and the BoE team work really well together. We collaborate continuously. And we have really productive relationships that allow us to build efficiencies within our organization,” Estrella said.

Not unique

The Danbury Board of Education is looking at a 19.2% increase, Asmani said.

“We talk to CFOs,” he said. “We’re all experiencing similar challenges in special education. It’s multi-lingual learners. It’s the cost of doing business, inflation, utilities… we’re fortunate that we’re locked into a utility contract for five years. That contract has since expired, they couldn’t wait for it to expire to give us new rates, because we have locked in at a much lower rate. So we’re seeing almost 35 to 40% (increase) in utilities, and I believe it is the same on the City side.”