The New London School District presented a balanced preliminary budget for the 2024-25 school year.

The proposed budget includes a 4.5% decrease in the tax levy, and a 12% decrease in the mill rate.

The preliminary budget was presented at the district’s annual budget hearing Sept. 11.

At the hearing, Joe Marquardt, district business services director, said the budget is a “planned approach.”

“We don’t feel like anything should be a surprise to any of you here tonight, in fact, many actions that are inside of our budget have already been approved by you as a board to various actions throughout the year,” Marquardt said.

The 2024-25 budget projects a 4.5% decrease to the tax levy, and a 12% reduction in the mill rate, Marquardt said.

“Those don’t always match because there’s an increase in property valuation the last few years that has really impacted a lot of municipalities and school districts across the state,” Marquardt said. “But those two are hand in hand items that people share often when you’re talking about property taxes.”

Marquardt said the reason the levy is projected to drop is due to the district’s revenue limit authority increasing from $10,000 to $11,000 per pupil in the 2023-24 budget.
“I use the word historic, because when I think of 30 years of revenue limits, that’s a long time, that’s the most the board has ever been able to increase based upon that authority,” Marquardt said.

According to the Executive Summary for the budget, the New London School District “had been in the bottom 125 school districts in spending authority per pupil, but the additional authority put New London at the same level as 70% of the other school districts in the state.”

Other factors, according to Marquardt, that influenced the preliminary budget included: competitive salary and benefits for employees, declining enrollment, maintenance and grounds operations, open enrollment, reduced federal funding, staffing shortages, and student achievement.

Marquardt pointed out that the district has no financial debt.

“There are no principal and interest payments that we have for items that were approved by the board in this year’s budget moving forward,” Marquardt said.

He added that the disadvantage to being debt free is the levy can’t be influenced by defeasance or staging expenditures.

It was also expressed in the Executive Summary that any future borrowings for referendums may have a larger tax impact “on a percentage change.”

Marquardt reminded the board that the budget is a projection as of late-August. The final levy and spending totals can change up until Oct. 23 when the levy is certified.

Budget assumptions
The proposed 2024-25 budget presented by Marquardt included some revenue and expenditure assumptions.

Revenue assumptions included: an estimated increase to state equalization aid of $67,883, a 4.5% decrease in the property tax levy, a 12% decrease in the mill rate from $5.95 to $5.21 of taxable property, a 9% increase in property valuation, a total decrease of $349,180 to the Fund 38 levy, a $325 total increase in revenue limit authority per pupil, a 6.6% increase in special education state aid eligible expenditures, no increase to categorical aid equal to three-year rolling pupil count average, and 100% levy authority.

Expenditure assumptions included: a budgeted 8% increase to health insurance plans; a 5% budgeted increase to dental insurance plans; minimal changes to the districts staff; a 4.12% wage increase for administrative staff, support staff, certified, and administrative staff; an additional $75,000 budgeted for supplemental compensation, 403(b) match, and years of service stipends for eligible staff; the purchase of a school bus for the 2024-25 school year; a reduction of 33 full time students; a net loss of 143 students to open enrollment; expenditures related to the capital projects master plan are budgeted for high school roof replacement; and the total private school voucher impact, which won’t be known until October. Last year the impact was 4.75% of the total levy, which is passed on to school property taxes.

Marquardt said the district has exhausted the ESSER I and ESSER II funds it had received. The district has $422,916 in ESSER III funds that has been allocated to different projects by the board.

Conclusion
The district is 17% below the state average for the mill rate, Marquardt said.

“That’s a credit to the board having the foresight of what fits well for the School District of New London,” Marquardt said. “I think it’s an important piece for you to share that we are as a school district below the state average.”

Board President Chris Martinson said that the district having a balanced budget and projecting to add to its fund balance “is a testimony for this board and your work to be thrifty and do the right thing with what you’ve been entrusted to do.”