The Tupper Lake Central School District held its regular monthly Board of Education meeting in the Middle-High School library on Monday. From left are district Business Manager Jessica Rivers, board members Mary Ellen Chamberlain and Sabrina Shipman, board Vice President Jason Rolley, Board President Jane Whitmore, district Superintendent Jaycee Welsh and district Clerk Shauni Kavanaugh. (Enterprise photo — Chris Gaige)

TUPPER LAKE — Unless changes are made soon, the Tupper Lake Central School District will continue tracking toward dire financial straits, according to the district’s financial advisor.

Dr. Rick Timbs delivered a sobering, nearly 90-minute presentation at the district’s regular monthly Board of Education meeting held on Monday that showed massive projected deficits down the road unless the school significantly expanded revenue streams and/or cut costs.

Timbs is a retired BOCES Superintendent who now provides financial guidance and recommendations to about 70 districts throughout New York. He was hired by the district over the summer to provide a long-term financial outlook and provide guidance and recommendations to district officials for how it can improve its financial health, according to TLCSD Superintendent Jaycee Welsh.

”That information needed to come out,” she said on Wednesday. ”It was nice to get such a long-range picture because I don’t know that the school district’s ever done it.”

Welsh added that since she and district Business Manager Jessica Rivers began their positions with the TLCSD over the summer as well, the new slate provided an opportunity to engage in long-term financial analysis.

”Since both the superintendent and business manager left the district recently and at the same time, it made sense to engage in the Long Range Financial Analysis process to get a realistic picture of the district’s financial strengths and weaknesses,” Welsh wrote in a text message to the Enterprise on Tuesday.

The crux of Timbs’ presentation centered around exorbitant expense increases — at the current trajectory — for the district in the absence of any revenue increases that would even come close to matching what would be needed.

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Approach and forecast

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Timbs began his presentation with an overview of the data sources he used to create his outlook and recommendations. Those included state Education Department data, external auditor reports, transportation and capital projects data, all other expense-driven state aid, tax implications, debt service funds or reserves, state Comptroller reports, district uses of funds, projected teachers and other employees’ retirement systems rates, implications of the loss of American Rescue Plan and other COVID-related federal grant funding, determinations of future district expense eseclations and interviews with Rivers and Welsh.

The presentation then turned to an analysis of the district’s fund balances and reserves.

Timbs said TLCSD has enough money in its various reserve funds — many of which he added were woefully small — to tread water at its current pace for next year, avoiding an imminent fiscal crisis that would result in the school needing to take on debt to continue operating. However, unless changes are made starting this year, the district will set itself up for that crisis beginning the year after, according to Timbs.

The deficits were striking. According to Timbs’ calculations, beginning in 2026, the district’s revenue-to-expenditure difference is predicted to be $1,242,548 at the current trajectory. The gap widens each year. In 2027, that figure rises to $1,937,605. In 2028, it becomes $2,695,377. In 2029, it rises to $3,503,830 and in 2030, it balloons up to $4,325,688. Timbs explained the various assumptions he made in developing both future revenues and expenditures to arrive at such large deficits.

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Money in

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For the revenues, he placed the tax levy at 3.08% — TLCSD’s tax cap — and maintained that rate of increase each year. He assumed marginal increases in state Foundation Aid, which he said accounts for about one-third of the district’s revenue each year.

”You are heavily dependent on this,” he said, referring to Foundation Aid. ”Last year, you got no increase. Zero. It was not an election year. This year, in the Governor’s proposal … you are getting a 2% increase. … (2026) is an election year. I have put a gentle 1% increase in here, hoping against hope that you do get more money, but there is no guarantee that you will get any more money.”

He said the reason for that came down to enrollment, which is a major part of the state’s consideration when determining aid rates for each district. Timbs said the outlook was not good for Tupper Lake, in that regard.

”Your enrollment is not stable,” he said. ”It’s been declining for a number of years. It’s not that the state says ‘Well, what was it last year compared to this year?’ They’re actually looking back over the last decade so that’s part of the problem that we’re facing here.”

Timbs noted that the district was in a tough position when it comes to receiving foundation aid. He pointed to data showing increasing property and income values in TLCSD, which the state sees as a reason not to provide as much foundation aid as they do to other districts.

”You live near a lake,” he said. ”Meaning that your property values tend to be higher on average compared to other districts that don’t live near a lake. In their formula, it kind of penalizes those districts, saying we’re going to spend money toward more needy districts.”

Timbs assumed stable transportation aid to the district, but added that his forecast did not account for the looming electric vehicle bus mandate beginning in 2027, which he said TLCSD — along with almost all districts in the state — does not currently have the funding for.

He said that while he understood the aspirational reasons for wanting to move away from fossil fuels, the reality was there’s no way to pay for it at the moment, making it ”ridiculous as a mandate” to him. He said it was imperative that the districts lobby against it, which Welsh has been doing in her meetings with state Assemblyman Billy Jones, D-Chateaugay Lake, and state Senator Dan Stec, R-Queensbury, who represent Tupper Lake in their respective legislative bodies.

”I’d say probably 99% of school districts have no money for this,” Timbs said. ”There’s not enough grants for this. There’s not enough room in budgets for this. I would hope board members tomorrow get on the phone, call your legislators, and tell them to push this mandate — if they still like it — back 5 to 7 years because nobody can afford it, and that includes the state.”

Timbs assumed that building aid would follow the debt service schedule. Timbs noted that the Tupper Lake Memorial Civic Center — which is owned and operated by the district, posed a financial problem, given that the state does not provide any aid for it.

”The lack of a long-range financial capital plan for the civic center has been and will continue to be problematic,” he said. ”Something tells me that this civic center will need more work in the future. … If they’re of any magnitude, the cost will be completely borne by the district. And what I mean by that is, there’s no state aid on a civic center — even if you own it.”

He said that while it may be cherished by the community, it’s a nightmare for the school’s budget as currently structured, and something for the district to have to think long and hard about.

”They’re nice to have,” he said. ”They’re great to have. (The) community loves them. Kids love them. Parents love them. But, the state does not, and they still will not help you fix this. They’ll let you fix it, but they will not help you fix it. It may jeopardize your mission because the more you spend money here, or on other non-aidable parts, the more difficult it is to provide that sound basic education. It’s draining money from your treasury.”

Welsh said on Wednesday that the district has no plans to sell the civic center.

”Not at this time,” she said. ”The costs haven’t been strictly monitored there yet. We need to get through a year of strictly monitoring those costs and making cost-based decisions on the benefits and pitfalls of it. I haven’t been here long enough to be able to really make any determinations about that and our community loves the civic center.”

Welsh said that the community donations to help with the repair costs over the last several months have been extremely helpful, and that people should not anticipate ”any major shifts with the civic center anytime soon.”

She added that the district is, however, aware that it does not have the financial capacity to sustain any future major repair costs.

”We recognize that if something big were to happen at the civic center, we don’t have the financial capacity to help without community assistance,” she said. ”We were able to get that community assistance (last) fall and in alignment with our current capital project, we’re going to be able to fix what’s wrong. But, in the future, and in the absence of that capital project, we’re going to be at the community’s mercy if we need to fix something in that building if we don’t make steps forward on a capital reserve.”

Welsh said the district has plans to propose a capital reserve for the civic center expenses to the voters this year. In Timbs’ presentation on Monday, he lauded capital reserve funds for their transparency with voters as well as their specific allocation of funds. Welsh agreed.

”It’s a reserve that’s stared by the voters — and the voters make the decisions for those capital projects,” she said. ”It’s transparency at its finest.”

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Money out

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On the expenditures side, Timbs assumed the district would follow its various contractual obligations, there would be no notable changes in staff patterns from 2025-26 and that there would be stable increased costs to the employee and teachers’ retirement systems.

Timbs said it was imperative that the district re-evaluate its expenditures associated with staffing, given how significant of an expense for the district’s overall cost it was. Timbs said that having staffing costs being such a large percentage of the budget is inherent and normal for a school district. However, because it was such a large cost, in order to trim the expenditures down to remain fiscally healthy, it’s a necessary place to look to for cuts, he said.

”$15 million of all your (roughly total $21 million expenditures) are people,” Timbs said. ”You can cut back on paperclips (and) leases for copiers. You could have less field trips. You can buy one less bus. It’s not going to cut it. So, my point would be is you’ve got to make significant decreases in the escalation of your expenses. You’ve got to reevaluate all of your purchases and all of your staffing. Absolutely reevaluate.”

He said that throughout the state, a higher than normal percentage of staff was reaching retirement age. Using himself as a hypothetical example, he said the district needed to take a hard look on what to do as retirements occur.

”You’ve got to look at the possibility of attrition,” he said. ”If we don’t absolutely 100% need to replace Rick, don’t replace Rick.”

He said it was a crucial piece of the puzzle for the district to remain fiscally sound into the future, while acknowledging that it will not be pleasant.

”Attrition is going to be critical here,” he said. ”And you’re going to need a lot of it. … You are maintaining staffing levels with reduced enrollment without millions of dollars in federal grants (anymore). Therefore, this is financially prohibitive. There’s just no way about it. I’m just trying to state a fact. This is going to be a very gnarly problem.”

He said that unless changes are made, the district’s ability to raise more money, given the realistic constraints with foundation aid and tax cap increases, will not be able to keep pace with salaries and benefits for current staffing levels.

”You’ve got to watch these long term expenditures,” he said. ”They’re really startlingly huge. Your financial plan is important because you can see the expenditures moving rapidly but you should also be seeing the limitations on your revenues. They’re very limiting. Salaries and benefits are overwhelming your district’s finances versus any potential revenue gain. There’s no other place to get money.”

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Next steps

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Timbs said time is of the essence if the district is to right the ship, financially.

”I would start with next year’s budget,” he said. ”I would not delay in the least. I know it’s getting late in the year, but you really ought to look at this very, very hard.”

Welsh agreed, and said Wednesday that she and Rivers were acting on Timbs advice.

”We’re looking at the (2025-26) budget. We’re looking at every single line, every single position, every single expense that this district has had. We’re talking with department heads and analyzing whether or not its a necessity or if it’s something that we can realign or restructure. We have some pretty big and bold changes that we’re going to present to the board to move forward.”

Welsh felt that Timbs’ information was vital to letting the district know what it needs to do to get itself to a stronger future than where the path its currently on will lead to. The district now needs to begin implementing his recommendations.

”Dr. Rick Timbs was the one to give us the big, accurate picture,” she wrote. ”Now we need to put in the work to get us there.”