Champ defends proposed capital reserve fund at public budget forums

According to the school district, the boilers at Pelham Memorial High School are among the items that could be funded by the proposed capital reserve. (They could also be replaced via the traditional means of a bond sale.)

Superintendent Dr. Cheryl Champ defended the proposed capital reserve fund after residents expressed concern over its purpose during public hearings about the fund and the tentative 2022-23 district budget.

The capital reserve fund would draw from budget surpluses to a maximum of $10 million, and spending from it would be subject to voter approval. Champ cited transparency and increased flexibility as the main reasons for the proposed fund.

“There are more steps to the capital reserve fund that makes it more transparent,” explained Champ. “It feels like a more transparent method for us.”

While the budget was met with general approval by residents, many voiced concerns about the reserve. Specifically, residents Steve Shekane and Scott Wolfgang expressed particular concerns about why the fund is necessary and its implications in regards to taxes.

“Why do we think we don’t have enough flexibility?” said Wolfgang. “In some regards, the capital reserve has less flexibility, but even so it seems like we already have a fair amount of flexibility.”

Shekane argued that the fund would actually decrease flexibility for taxpayers even if it might increase flexibility for the district.

I completely disagree with this thing,” said Shekane. “I’ve spent my career lending money. Paying money over time is better than paying upfront. While you can argue that it’s more flexible from the district’s perspective, from the taxpayer’s perspective it’s a lot less flexible.”

Wolfgang and Shekane both brought up that the district currently has $21 million dollars in surplus as opposed to a typical year of $15-16 million dollars, which already provides more flexibility for the district than usual.

“We could take a million dollars from the $5 million in the surplus and roll it over into the next year to control tax increases,” Shekane explained. “We are at $21 million within the surplus when we were comfortable with $15 million and $16 million in previous years.”

Wolfgang also asked Champ to indicate some specific projects that would be financed by the fund. “If these same projects are in the budget or a bond, the community is already aware of them,” said Wolfgang.

Champ explained that with this capital reserve fund, the budget would go straight to the voters, and the capital reserve would act as a “separate proposition.”

“With the inclusion of a capital reserve fund, voters can say yes to the budget but veto certain projects,” said Champ.

The $83.7 million proposed budget, as well as six candidates for three vacant seats on the school board, will be also be on the school election ballot on May 17.