Lynn schools attempting to solve $8.5M budget gap

LYNN – The city is spending $8.5 million less on the Lynn Public Schools than the state says it should, but Mayor Judith Flanagan Kennedy said there is a “clear path toward resolving the issue.”The Department of Elementary and Secondary Education requires communities to contribute a certain amount of money that, when combined with state educational aid, represents a community’s “net school spending requirement,” or what a community is required to spend on education.”I’m working closely with officials at DESE, our financial departments and the state delegation,” Kennedy said in regards to the spending gap. “We are steadily moving toward a resolution.”She did not spell out the details of the plan or how it might affect the budget for the current school year or the 2014-15 school year, but she did note the debt is unexpected.School Committee members John Ford and Charlie Gallo both said the problem springs from a decision made 20 years ago by school officials. It was a decision Kennedy said neither she nor anyone in the current administration was ever made aware of until recently.According to DESE information officer Lauren Greene, some school districts are permitted to include retired teacher health insurance costs in their net school spending. Districts that did not check off a box on a form in 1994 cannot claim the costs as net school spending. Lynn is listed as one of the cities that “cannot count their retired teacher health insurance costs,” said Greene. But it has been doing so for an undetermined length of time.A recent audit by the state discovered the discrepancy.The fact that neither Kennedy nor Superintendent Catherine Latham were aware that the city could not claim money spent on retired teachers’ health insurance costs under net school spending worries parent and school activist Lori D’Amico.”How does that happen?” she asked. “I don’t understand how is it that you do not know what the current policies are.”According to a letter from DESE dated December 2012, Latham was warned that the city faced a shortfall in net school spending of $1.6 million, but Kennedy said that was addressed and that was the only deficit that was pointed out. She also said that deficit was addressed, which was why she was surprised when the $8.5 million deficit came to light.State law allows a community a 5 percent range when it comes to net school spending, which means it a shortfall occurs, as long as if falls within that 5 percent range, there is no penalty. Kennedy said had it not been for the deficit uncovered by the audit, “we would have been well within the acceptable range.”School Committee members are concerned but optimistic -? and tight-lipped – about the issue.Committee member Rick Starbard said he’s hopeful that the situation can be rectified so that the number owed “won’t be quite as high as it seems.”John Ford said Kennedy has indicated it will be resolved.”I trust in Judy,” he said.Charlie Gallo noted that the issue has yet to appear on a School Committee agenda, and since budget discussions have not started, it’s not been discussed in that context.”From my point of view, there needs to be a lot of coordinating to figure this out,” Gallo added.Gallo also pointed out that Lynn is not the only community to find itself in such a position.According to figures released by DESE’s Office of School Finance, Lawrence is $8.9 million below its net school spending, Methuen $5.1 million, Taunton $4.4 million and Lowell $3.8 million.Greene said there had been legislation that would have resolved the issue for communities such as Lynn and Lowell, but it was never approved. Kennedy indicated that local delegation members will try to resurrect the bill. Rep. Robert Fennell and Sen. Thomas McGee could not be reached.”Everyone is very aware and has a good grasp of the issue,” Kennedy said. “And there is a clear path toward resolving it.”