1. Over the five years ending in 2003, why has the school budget risen 34% while enrollment has increased only 4.8%?

First, let's look at enrollment numbers:

Level	1999 Enrollment	2003 Enrollment	Change in Enrollment	Percent Change
Elementary	2,792	2,704	-88	-3.2%
Middle	1,380	1,522	142	10.3%
High School	1,543	1,766	223	14.5%
Total:	5,715	5,992	277	4.8%

Note that staffing demands are different at secondary levels than at elementary levels. At elementary levels, the decrease of 88 students across 6 schools, does not even lower the pupil teacher ratio by 1 (we have over 120 elementary classrooms), and it is unlikely that the number of teachers could have been reduced unless schools already had very low class sizes (exception at Bowman to address MCAS performance).

However, because we added 71 students to each middle school, and 223 students to LHS, we needed to add staffing at those levels to keep average class size from rising. To accommodate this student growth, we had to add secondary teachers.

Now let's look at the growth of our budget. Much like the rise in the value of Lexington's residential real estate was not related to the rate of inflation, many school costs were driven by factors beyond the Town's control during 1999-2003. These costs included spiraling cost of health-care benefits, transportation cost increases, increased cost of operations and maintenance, increases in tuitions for SPED placement, expansion of nursing and safety services, cost of unfunded mandates, and shortage of personnel leading to rising administrative and teacher salaries.

The comparison for these expenditures is as follows:

Expenditure	FY1999	FY2003	Total Change
Benefits	$3.53M	$7.26M	+$3.73M or 105%
Transportation	$1.1M	$1.6M	+0.5M or 45%
Maintenance & Operations	$4.2M	$5.2M	+1.0M or 24%
Nursing, Safety	$0.4M	$0.6M	+0.2M or 50%
SPED Tuition	$2.25M	$2.67M	0.42M or 19%
Total	$11.48M	$17.33M	+$5.85M or 51%

Comparing costs between 1999 and 2003, we can see that without any salary increases or mandated programs, the budget would have grown by $5.85 million or 12.8%. Below is a more detailed look behind the numbers.

Like for many corporations, the cost of health-care benefits rose much faster than inflation (average of 15.7% annually). Since personnel costs account for over 80% of the school budget, the rising cost of benefits (105% during this period) has played a large role in the total budget increase.

Increasing cost of transportation is another item that has risen much faster than the cost of inflation. Average cost increases were almost 10% annually, driving the 2003 cost to additional $500,000 over transportation costs in 1999, a 45% increase over the four years.

The school system completed renovations of all three secondary schools. With new space coming on line, they had to increase maintenance budgets and replace old non-working cleaning and maintenance equipment to help protect our investment in these renovated buildings. In addition, the cost of utilities grew much faster than inflation. Operations and maintenance alone grew by $1million in 2003 over the 1999 base.

The schools hired additional nursing staff to ensure safety of children who come in increasing numbers with serious medical conditions (e.g., life-threatening allergies). For several years this nursing increase was paid for by a state grant. Unfortunately, though the need for these services remains, the state grant has been eliminated, leaving the schools to foot the bill. Other positions that were funded to improve the safety of our students were additional crossing guards, two police liaison officers (eliminated after the loss of last year's override) not reflected in the figures above, and two LHS campus monitors. In 2003 increased safety staffing added over $300,000 to the 1999 base staffing cost. In addition, tuition costs for students with special needs who could not be served in our district rose by almost 20% over the 4 years, from $2.25 million in 1999 to $2.67 million in 2003, again without sufficient reimbursement by the state.

The mandated implementation of MCAS, No Child Left Behind act and of revised State Curriculum Frameworks required the strengthening of our curriculum and student support services. Though these programs are mandated, they are NOT sufficiently funded by state and federal governments, leaving the towns to pay for majority of these services.

There is a nation-wide shortage of educational administrators resulting in, for example, 3 years being the average tenure of superintendents. Like most other towns, we have had our share of retirements and turnover amongst our administrators. Every time an administrative position turns over, to attract good candidates, we have to offer a salary that is competitive with other towns. Since 1999, we've hired three superintendents, two facilities directors, a curriculum director, two directors of student services (SPED), a human resources director, and brought back an outstanding budget director. We hired four principals and several assistant principals. Because the Director of Grants brought in far more than her salary in grant income, in 2000 her part time position became full time. Finally, because of reporting changes, some coordinator positions became classified as administrators. These changes in coding and personnel added $900,000 to the 2003 administrative category over what we paid in 1999. While this seems like a very large increase, Lexington lags behind both Brookline and Newton in administrative salaries. Yet, in spite of this increase, most recently Lexington ranked 7th least costly of ten comparable communities in per-pupil cost of education, and 44th least costly out of 351 Massachusetts communities.

We all know that the quality of every child's education depends foremost on the quality of teachers. To attract and retain excellent teachers, the system had negotiated contracts that offered reasonable annual cost of living increases, and step-and-level increases which reward teachers for professional longevity and level of education. These increases, budgeted separately, provide incentive for teachers to remain in the profession (addressing the shortage of teachers), and to continue taking courses to improve their teaching. For details of the current teacher contract, see LEA Contracts.

As you can see, though inflation was low and enrollment growth moderate, many major items in the school budget were affected by mandates and double-digit price increases. And to make matters worse, as mandates and expenses were increasing, state aid was being cut. Looking at school budget growth in other similar communities, we will see that Lexington ranks 7th among 13 comparable communities. Over the same period, the growth of their budgets ranged from 159% in Lincoln to 23% in Belmont, with majority of communities ranging between 30% and 40%.

To make up for some of the lost revenue, the system raised fees charged to parents and facilities users. In 1999, the system collected $474,000 in fees while in 2003 it collected $883,900, a 86% increase!

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