LYNN — It could be until August before city and school leaders find out how much state aid has been allocated to Lynn for the next fiscal year.
And that has brought uncertainty to budget planning, according to Lynn Public Schools Business Administrator Kevin McHugh.
As the next fiscal year begins July 1, McHugh told the School Committee last week that the district is tentatively planning to work on a one-twelfth budget for the months of July and August.
With state aid in limbo for another two months due the coronavirus’ continued strain on the economy, LPS administration would likely be looking at the end of August before their FY2021 budget is prepared for a School Committee vote, McHugh said.
Last year, the School Committee voted to approve the district’s FY2020 budget in late June.
“It seems that nobody has a real clear picture of what the Chapter 70 (the major program for state aid to public schools) program is going to be for next year right now,” said McHugh. “The Speaker of the House (Robert DeLeo) was very clear … when he stated that due to the taxes being given a grace period to July 15 of this year, as well as the fourth quarter revenues that aren’t looking really good, he’s not doing anything until he has that information.”
McHugh said operating on a one-twelfth budget “makes sense at this point” until there’s more clarity around revenue and how that will drive the state budget overall, which includes determining the amount set aside for the Chapter 70 programs.
“Once we get any other information, we will have a follow-up with the mayor, CFO, superintendent and I about how we steer the Chapter 70 money and how it’s going to affect the city of Lynn,” said McHugh.
Under Gov. Charlie Baker’s budget proposal in January, the city’s school district would have received $216 million in aid through the Chapter 70 program, representing a $30.19 million increase in funding over FY2020.
However, McGee told The Item in a past interview that now, he doesn’t expect the city will receive level funding over last year, which presents a difficult scenario when nearly 70 percent of the city’s budget comes from state aid.
McGee, chairman of the School Committee, said at last week’s meeting that he hasn’t been able to get a sense of what the numbers will be like for the next budget cycle despite taking part in dozens of calls with state and local leaders, including Baker, and the state’s Senate President Karen E. Spilka.
“The reality of the financial crunch that we’re facing is clear across the board when they’re looking at trying to get a feel for what’s happening over the next few months,” said McGee.
McGee said the city was facing a similar scenario in FY2010, in terms of the federal and state budget resulting in a “hit” to Lynn’s budget, which was due to the last economic downturn in 2008.
However, even then, the situation wasn’t as grim at the state level, said McGee, who was a state senator at the time. In FY2010, the state was facing a $2.6 to $2.8 billion deficit for its budget, but state lawmakers have projected the deficit for FY2021 could be between $4-6 billion, McGee said.
“There’s no real indication of the numbers, but I think the reality of the deficit is more dire than what we saw in 2006 and 2008,” said McGee. “I think the reality for Lynn and probably every other community in the state, as well as every other locality around the country, is what the federal government will do to help us address what will be really substantial challenges in 2021.”
Although the U.S. Senate has been reluctant to pass an additional coronavirus relief package, Majority Leader Mitch McConnell said last Friday that the “fourth and final” economic relief bill will begin in “about a month,” according to NPR.
Last month, the U.S. House of Representatives passed a $3 trillion economic relief bill, dubbed the “Heroes Act,” which would provide more than $1 trillion to state and local governments. However, the bill, passed by the majority-Democrat House, has little bipartisan support and is expected to fail in the Senate.
McGee, a Democrat, said he believes local communities are going to need additional federal funds, especially to support areas such as public education and safety.
“I know the U.S. Conference of Mayors is advocating pretty strongly for a package that includes substantial dollars to supplement the lost revenue that every city and town around the country has faced,” said McGee. “As we try to figure out our own budget locally without having any really solid numbers on both Chapter 70 and unrestricted aid, it’s really a challenge.”
Following a suggestion from School Committee member Jared Nicholson, the panel unanimously voted to send a formal statement to the city’s federal delegation asking that they support the city’s efforts for public school funding through an additional coronavirus relief package.