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Jan 22, 2014 9:48 AMPublication: The Southampton Press

Report: East Quogue School District In 'Moderate Fiscal Stress'

Jan 22, 2014 11:10 AM

A new state comptroller report released last week confirmed what East Quogue Elementary School officials have been lamenting for years: that the district is likely approaching economic hardship.

The report, which examined 674 districts throughout the state, classified the East Quogue School District as one of seven Long Island districts—and the only one on the South Fork—as suffering from “moderate fiscal stress,” the second-most severe rating on the scale designed by State Comptroller Thomas P. DiNapoli.

The nearby Eastport South Manor School District was designated as being “susceptible to fiscal stress,” a lower rating, because of its consistent operating deficit, according to the same document.

East Quogue Elementary School Principal Robert Long said this week that he agrees with the state’s assessment, adding that the restrictions of the state-mandated 2-percent tax cap have hit the small district particularly hard. “We do think it’s accurate,” he said of the report. “It actually verifies what we’ve been telling people for years.”

The comptroller’s report used a system designed by Mr. DiNapoli to identify early warning signs of economic distress in school districts using factors such as fund balances, operating deficits, cash on hand, cash flow borrowing and fixed costs, as well as demographic factors like changes in population, fluctuations in property values and child poverty rates.

Ratings were based on a weighted point system, with a total possible score of 21; the higher the score, the worse off a district is in terms of finances.

East Quogue received 12 points on the scale, or 55 percent of total points possible, while Eastport South Manor earned eight points. School districts receiving scores of five or less were not considered in fiscal stress, those receiving between six and 10 points were labeled as susceptible to fiscal stress, while those earning 11 to 14 points were determined to be in moderate fiscal stress. Districts scoring 15 points or more were labeled as being under significant fiscal stress.

Brian Butry, a spokesman for Mr. DiNapoli, said this system is designed to inform taxing districts, including schools and local governments, of impending financial hardships and identify specific problems while they can still be addressed. The more severe the rating, the more dire the situation, he noted.

“It’s more an early warning system giving not only local officials but also taxpayers an idea where their districts are at,” Mr. Butry said.

In 2013, the East Quogue School District’s fund balance stood at $382,979, or about 1.8 percent of its $21.7 million in general fund expenditures, according to the comptroller’s report. Districts are asked to maintain a fund balance that’s between 3 and 4 percent of its total operating budget. The shortfall earned the district two points on the scale.

The district picked up another three points for having a spending deficit of $788,710 for 2013 as East Quogue spent $21.7 million that year while taking in only $20.9 million in revenue, according to the report. The state wants school districts to keep their spending deficits to under 3 percent of their gross expenditures; East Quogue’s spending deficit accounted for 3.6 percent of that amount in 2013. The district’s spending deficit stood at 5.4 percent of its gross expenditures in 2012.

East Quogue also issued $5.5 million in debt last year, more than a quarter of what it brought in through taxes, earning it another three points on the comptroller’s scale.

Mr. Long said his district has blown through reserve funds in recent years as part of its efforts to keep teachers and programs in place despite limited tax revenues. In May 2013, the district attempted to pierce the tax cap with a proposed budget that would have increased spending by 2.9 percent, but the budget vote by district residents fell seven votes shy of reaching the necessary 60 percent majority to do so. As a result, officials had to cut nearly $600,000 off their initial $23 million budget proposal by eliminating an additional custodial position, three special education teachers and multiple teachers aides and assistants. That, combined with some unexpected expenses, has left the school in a tough situation.

Two years ago, East Quogue underestimated how much tuition it would need to pay the Westhampton Beach School District to educate its middle and high school students by approximately $400,000, an oversight that has contributed to East Quogue’s current fiscal woes. Tuition makes up close to half the district’s expenses.

“We’ve been trying to keep taxes as low as possible, and we wore down that fund balance doing so,” Mr. Long said. “We had been warned that we could be in some trouble. It’s a predicament, for sure.”

East Quogue Board of Education President Mario Cardaci said Monday that he was not aware of the comptroller report as he has been tending to personal issues in recent weeks. When reached Tuesday, fellow board member Diana Gobler said she needed to confer with other board members before discussing the issue. Board members Patricia Tuzzolo and Katheryn Tureski could not be reached for comment this week.

Board member Carrie Bender said she could not comment on the issue, adding that Mr. Cardaci is the only board member allowed to speak on topics the board has not discussed as a whole.

“Anytime anything is released by the board, it either has to go through the board president or the superintendent,” Ms. Bender said. “I can’t speak on behalf of the school or the board, because we haven’t had a chance to meet about it yet.”

East Quogue Superintendent Les Black said his district has “taken every conceivable measure that we can think of” to keep school taxes low while maintaining as much staff and programming as possible, but the district is running out of options and might have to consider making cuts. In recent years, the district has offered retirement incentives to teachers, but with no more retirement-eligible educators in the wings, additional layoffs might be necessary, Mr. Black said, adding that it’s too early to say anything definitive.

“Unfortunately, at this point, it’s difficult to find any more rabbits to pull out of hats,” he said.

Eastport South Manor Superintendent of Schools Mark Nocero said Tuesday that it is unfair for the state to bestow the label of “susceptible to fiscal stress” on his district because the reason it qualified for the ranking was because district officials were following directives from the state.

Mr. Nocero explained that, in recent years, his district had been making up for losses in state funding by tapping its reserves in lieu of raising taxes, which the governor and comptroller directed all districts to do after the tax cap was put in place. Mr. Nocero added that with policies like the tax cap and the Gap Elimination Adjustment—the latter being a debt-reducing initiative started in 2009 by former-Governor David Paterson—all Long Island schools are suffering from some form of fiscal stress.

“If schools on Long Island weren’t on that list, let me just say that every school district on Long Island is susceptible to fiscal stress,” Mr. Nocero said. “With the cuts we’ve had in state aid in the last five years, there’s no school district on Long Island that’s going to say it isn’t in some kind of fiscal stress.”

Two of the 124 Long Island school districts examined were classified as being in significant fiscal stress, the most severe rating, while seven, including Eastport South Manor, were listed being susceptible to fiscal stress. Most of the districts that were identified as being distressed were upstate, according to the report.

According to a release from Mr. DiNapoli’s office, most of the fiscally stressed districts shared common characteristics, such as having “low fund balance, operating deficits and limited cash on hand.” Many of them also frequently use short-term borrowing to bridge cash flow gaps.

Without an increase in state funding, East Quogue could be in trouble again come this budget cycle, which Mr. Long said is already in its early stages.

“We have a fantastic program here, and this is making it very difficult here to continue that tradition,” the principal said of the district’s financial difficulties.

Mr. Black has joined other Suffolk County superintendents in trying to convince Governor Andrew Cuomo and the State Legislature to end the Gap Elimination Adjustment in an effort to help bring more funding to low-need districts on Long Island. The Gap Elimination Adjustment, or GEA, reduced state funding to schools and other programs to help close the state’s multibillion-dollar spending gap.

Mr. Cuomo has continued the program since taking office in 2010, though there was some speculation that he would pull the plug on it due to a surplus in Albany. However, his tentative 2014 budget released Tuesday makes no mention of eliminating the GEA.

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East Quogue School is just one of the finest schools in the state with an extraordinary staff and a principal who is among the best in the business. To see this school in this kind of predicament is sad, indeed. I know the school and its administrators have taken extraordinary steps to ensure that the quality of their instruction is not sacrificed to financial conservatism alone. If this school is in this predicament then something is wrong with the system--not the school and its staff. This is ...more
By Capt. Phil (64), Southampton on Jan 24, 14 9:54 AM
There is nothing basically wrong with the system. There is something basically wrong with the financial administration of many school districts on the East End. These are well funded school districts with high school expenditures per student, many of whom have gotten fat and lazy with frequent double digit increases in taxes and funding.

It has reached a tipping point with widespread taxpayer complaints about crazy tax increases all over NY state that the Governor felled compelled in response ...more
By Obbservant (449), southampton on Feb 1, 14 7:20 AM
Agreed that its a fine School with great teachers and staff but the problem is extremely simple- they pay out more then they take in. Simple math any elementary school kid can get. Read Newsday today on the amount of expenditures for Nassau and Suffolk County in relation to the rest of the State. No difference. Of course if the taxpayers want to increase taxes again- thats their choice. Eventually people will run out of money to pay taxes with and our teachers and public officials will all be retired ...more
By realistic (472), westhampton on Jan 24, 14 1:17 PM
2 members liked this comment
Perhaps it was not a wise move to allocate $400,000 to buy property next to EQ Elementary School!! Cardaci, Tuzzolo (Cardaci) & Tureski long time BOE members oversaw budgets and all collective bargaining contracts for many years. Just how did they go through all the reserves? There were many years when the EQ Elementary School got double-digit increases from real-property homeowners. Despite the 2% tax cap which Black & Long blame for their financial hardship my 2013/14 real property tax bill for ...more
By crusader (391), East Quogue on Jan 24, 14 3:14 PM
2 members liked this comment
The song remains the same.
By dnice (2346), Hampton Bays on Jan 24, 14 9:26 PM
I guess the "moderate fiscal stress" the EQ Elementary School is under does not allow them to clear snow on their sidewalk on Central Ave!! Do they still have a maintenance staff? Any children who walk to school on Central Avenue are forced to walk in the road.
By crusader (391), East Quogue on Jan 27, 14 1:29 PM
We know that everything EQ Schools does is wrong in your eyes but please don't spread untruths. I am at that school every morning and I can assure you that children are not "forced to walk in the road." The children walk in from either side of the bus loop and both ways are perfectly clear. There is even a path from the sidewalk on Lewis across the field. BTW...I believe any issues you have with snow removal from Town Sidewalks should be addressed to Alex Gregor.
By cmac (184), East Quogue on Jan 27, 14 1:52 PM
2 members liked this comment
I beg to differ with you.........the sidewalk in front of the newly purchased school property is not cleared!! Unless of course it was cleared AFTER my post. Those students who have to walk south down Central Avenue are forced to walk in the snow or in the roadway. You raise the issue of who has the responsibility to clear the sidewalk in front of school property on Central Avenue???? It is your belief that it is the Town's responsibility, nonetheless to date the sidewalk has not been cleared. ...more
By crusader (391), East Quogue on Jan 27, 14 4:12 PM
Correction to location......should read walking north, not south on Central Avenue toward EQ School from Montauk Highway I/F/O newly purchased school property. BTW, I am not speaking of the bus loop!!!
By crusader (391), East Quogue on Jan 27, 14 4:43 PM
You seriously need to get a hobby!
By cmac (184), East Quogue on Jan 27, 14 4:53 PM
1 member liked this comment
Hey, you answered my post with respect to the lack of snow removal on the sidewalk alleging that I am spreading untruths which is not the case !!! If your going to answer a post, please get your facts straight.
By crusader (391), East Quogue on Jan 27, 14 6:57 PM
The TOWN plowed that sidewalk after it snowed. It was extremely windy this weekend, so windy that the town had to re-plow Lewis Rd by the fields because the snow drifted over the road. The same phenomena also occurred on areas of the sidewalk, but the TOWN did not re-plow those. Are you suggesting that the school maintain the sidewalks for the children's entire walk to school? Is there a magical distance of Town sidewalk that they should be responsible for? There are many driveways that have ...more
By cmac (184), East Quogue on Jan 27, 14 9:19 PM
1 member liked this comment
cmac you keep referencing Lewis Rd which is not what my original and subsequent posts were about!!! I clearly stated CENTRAL AVENUE I/F/O the newly purchased school property !!! What part of that do you not understand??????
By crusader (391), East Quogue on Jan 28, 14 7:58 AM
Crusader, I don’t know of any parents making their children brave the polar vortex to walk to school. If you would like your daily walk on TOWN sidewalks to inspect the school to be unimpeded I would suggest you call Alex Gregor’s office at 728-3600. Maybe you can ask them to put some salt down after they remove the snow so you won’t slip. Have a wonderful day!
By cmac (184), East Quogue on Jan 28, 14 9:17 AM
1 member liked this comment
Cmac, nice observation. I guess those parents who have no car and are within walking distance are keeping their children home from school. BTW I noticed the sidewalk, DRIVING, to the post office, not walking. However, it would have been nice for someone to spend the 5-10 minutes it would have taken to shovel that strip. That could of occurred BEFORE we got the polar vortex after yesterdays melting causing additional ice making snow removal almost impossible. Oh, I forgot its nobodies job inside ...more
By crusader (391), East Quogue on Jan 28, 14 12:07 PM
If you notice, Crusader, the reference to Lewis Rd was only to COMPARE it to the piece of sidewalk on Central Ave in front of the school property. The snow on the sidewalk was caused by the same thing that caused Lewis Rd to have to be plowed again- the WIND!!
By eqmomof3 (22), EAST QUOGUE on Jan 28, 14 9:24 AM
1 member liked this comment
eqmomof3...........you are missing my point. I am well aware of drifting snow, but nonetheless that strip had a significant amount of snow on it. NO ONE from the school (Mr. Long?) made a call to SHT or asked something to pick up a shovel and clear that strip!!!!
By crusader (391), East Quogue on Jan 28, 14 12:16 PM
"If you have time to whine and complain about something then you have the time to do something about it." ~Anthony J. D'Angelo
By cmac (184), East Quogue on Jan 28, 14 1:13 PM
"Wise men speak because they have something to say; fools because they have to say something." ~Plato
By crusader (391), East Quogue on Jan 28, 14 2:07 PM
By cmac (184), East Quogue on Jan 28, 14 3:23 PM
2 members liked this comment
Wow crusader, way to sum up your existence.
By bubby (236), southampton on Jan 28, 14 4:40 PM