After better-than-expected savings on health insurance trimmed $280,000 from its working budget, the MERSD School Committee at its last meeting approved a $30.13 million FY25 budget, a 2.99% ($874,133) increase from last year.
Now it’s up to the Boards of Selectmen and Finance Committees of both towns to decide whether they will support the budget with town meeting voters.
“We’ve come a long way,” said the School Committee’s Anna Lin Mitchell after voting to approve the budget. “And I have hope that we will maintain the stability and the programming and the budget.”
The question remains whether this compressed budget is enough for Essex, which bears a significantly bigger proportion of the increase this year than Manchester based on the cost-sharing formula in the regionalization agreement.
Until now, the Essex FinCom and Board of Selectmen have been clear: keep increases to 2.5% or less, or they won’t support it.
The approved budget maintains staffing and service levels from FY24. Personnel costs constitute the largest portion at $18.861 million, reflecting a 3.41% rise, while operating expenses have increased by 4.21% ($480K) from FY24. Anticipated School Choice revenue of $500K aims to offset operating expenses by accepting 20 more out-of-district students in the 2024-2025 school year.
The last iteration of the FY25 working budget was $30.258 million—a 3.42% increase. Two weeks ago, that changed, according to MERSD Superintendent Pamela Beaudoin, when the district’s final health insurance costs came in at a 7.95% increase. (Earlier budgets conservatively estimated a 14.5% bump).
Based on the apportionment formula that dictates Manchester and Essex’s share of the district budget, Manchester’s increase in FY25 will be 1.84% ($295,193), while Essex’s increase will be 4.82% ($455,063).
The funding disparity comes from Essex’s stable student population, while Manchester’s student numbers have declined by 3%. These swings in each town’s share of the student population disproportionately penalized Manchester in years past, but for the last three years, Essex has held that burden.
Gone too far?
“I understand the limitations of the towns and I understand the situation that Essex is in right now,” said Sarah Wolf of Essex, and former SC chair. She said her family moved to Essex 20 years ago for the superior public education here and is discouraged by the direction the district has taken. “The district is at a crossroads, and tonight, the school committee has a choice between a path of stability rather than a path of decline.”
Wolf referred to the “déjà vu” in the last three years. Each year, the district has had to manage pressure from Essex and Manchester’s FinCom to tap school district reserves (a.k.a. its savings accounts). Each year, the district cuts services that opponents say is a slow grinding down of MERSD’s education quality by a thousand nicks of the budget-cutting knife.
Recently, the same budget hawks have begun targeting the administration for cost-cutting, even though, as non-union personnel, they make up less than 3% of the budget.
Ann Harrison, Manchester’s Select Board chair, has attended nearly every School Committee meeting in the last two years and is a past member of the School Committee and Manchester’s FinCom.
“Your responsibility is to your children, our students,” she told the School Committee. “Please, reinvest in the schools rather than yielding to the naysayers.”
Manchester parent Lindsay Banks challenged voters to hold the line and restore programs that made the MERSD experience unique and drove the district to be one of the best in Massachusetts.
“What is missing from too many of your conversations is the students and what is in their best interests,” she said, adding that nitpicking line items and dissecting a spreadsheet is gutting quality. Banks said her son’s class size increased by ten students just last year. This budget, she said, is a step in the wrong direction.
“Set us on a course of excellence,” Banks told the School Committee. “This should be your singular focus.”
MERSD: Fiscal performance against other districts
MERSD is not alone in its budgeting challenges. Every school district across the state is buckling under a fundamental challenge: how to operate within mandated Prop 2½ budget constraints when the pace of inflation—especially labor, healthcare insurance, and funding mandated out-of-district transportation of special needs students—is significantly higher.
Up until now, the district administration has been creative. They’ve passed on replacing retiring teachers. They’ve redeployed others to fill vacancies or shifted programs or class sizes to maintain budgets. They’ve cut items like the late bus, early foreign language, library specialist, or psychology counseling. But Beaudoin said that after years of clipping, combining, and cutting, MERSD may be out of ideas.
“We’re striking out with potential options,” she said. “I don’t know what else we’re going to look at.”
Brian Gressler, an Essex parent, said that according to the Mass. Dept. of Education’s data, MERSD’s budget performance is strong. MERSD’s annual budget increases have averaged 3.45% over the last 10 years. That’s not bad, he said, considering the US Census reports that school operating expenditures across Massachusetts rose by an average of 4.03% per year from FY13 to FY22.
Hamilton-Wenham’s regionalized school district is nearly identical to MERSD, and its average budget increase over 10 years is higher, at 3.9%.
Further, said Gressler, tuition for Manchester and Essex students attending North Shore Essex Technical High School increased an average of 4.68% in eight years, including last year’s 5.96% increase. Last year, Essex supported the Essex Tech overage by passing a Prop 2½ override.
“These other districts are dealing with those same issues, the same problems with inflation and declining enrollment. Our district appears to have done a better job managing these issues,” he said. “But we have to live in the reality that our community can’t control these macro conditions. Be they for the school budget or the cost of a full-time fire department, eventually the bill comes due.”
Dwindling prospect of “Super Town Meeting”
Manchester’s Annual Town Meeting is scheduled for Wednesday, April 24. Essex has scheduled its ATM for May 6. If the FY25 budget fails in either town, state rules would require holding a summer “Super Town Meeting,” a combined meeting of voters of both towns where it’s feared that Manchester’s larger population could force approval, a scenario Essex officials have said would be devastating.
Two weeks ago, Essex ME School Committee member Kate Koch-Sundquist said she is hopeful the Essex community will support the budget without an override, pointing out that the apportioned monetary difference between 2.5% and 2.68% to the Town of Essex is just $18,000. She questioned if town leaders would choose to send the communities to a Super Town Meeting for such a nominal figure.
But at its Feb. 11 meeting last week, the Essex BOS signaled hope—albeit in a quick, five-minute discussion—that may prove Koch-Sundquist correct.
Essex Town Administrator Brendhan Zubricki told the BOS that the state’s certification of new growth in the town’s tax rolls was $180,000, up from what was expected for FY24. Further, he said with three local students dropping from Essex Tech enrollment, the town will recoup some of the monies secured in last year’s Prop 2½ override.
“We’re in good shape,” said Essex Town Administrator Brendhan Zubricki. “At this point, we don’t see a need for an override.”
But that's not yet final. The Essex BOS will approve final budgets before March 25, when the ATM Warrant is finalized. That means whatever optimism indicated in those five BOS meeting minutes, the final answer on the override will have to wait until March. And whatever happens, MERSD’s challenges are bigger than this year’s ATM.
“I recognize that this is an apportionment problem right now,” said SC Chair Theresa Whitman of Essex. “My concern is I don’t think we are in the position any longer to continue to degrade the school district in an effort to fix that for one town.”
Highlights FY25 MERSD Budget
The next School Committee meeting is Tuesday, March 5 at 6 p.m.
