Milton school leaders are weighing a high-stakes fiscal maneuver to bridge a $2.1 million budget gap that threatens significant staff reductions over the next four years. During a Wednesday morning finance subcommittee meeting, Superintendent John Phelan and Finance Director Katie Canniff detailed a proposal from the Town Administrator to utilize $1.5 million in one-time free cash to bolster the operating stabilization fund. While the infusion offers a potential lifeline, Phelan warned that the town’s current 3% expense projection model remains insufficient for school needs and would otherwise result in the loss of about 11 staff members per year over the next four years.

The committee is grappling with a structural revenue gap where the town has allocated 84% of required service cuts to the school department and only 16% to municipal departments. Member Mark Loring expressed concern about the sustainability of using one-time funds for recurring payroll costs, asking, Does taking free cash for the operating budget artificially grow the budget next year if that money isn't there? Phelan acknowledged the risk but noted that spreading the $1.5 million over four years could provide a bridge to a potential future override, though he cautioned that the district would face a mountain to climb once those funds are exhausted.

To further close the deficit, the district is exploring revenue-generating measures that would directly impact local families. Loring noted that the committee is looking at increasing fees for athletics, transportation, and rentals alongside roughly $200,000 in non-salary reductions. These moves come as the administration attempts a broader fiscal reset to replenish revolving accounts that have been depleted to dangerous levels. Phelan highlighted the critical state of the Special Education Circuit Breaker account, which currently holds only $4,000 despite a target balance of $3.1 million. We are a $74 million organization with an unbalanced balance sheet, Phelan said. These accounts are shock absorbers. We won't be a healthy organization until we have a full balance sheet.

Regarding the current fiscal year, the committee reviewed a second-quarter report showing a razor-thin projected balance of $26,277. Member Nathan David Hutto characterized the figure as a sign of precise but precarious management. So that $26,000 is a signal that we have accurately budgeted, but also that there is zero flexibility, Hutto said. Not if, but when something happens, we’ll have to make hard choices. Canniff explained that her practice is not to spend down such small margins but to return them to the town to be certified as free cash. If we have $26,000 left at the end, I typically don't just spend it down, Canniff said. I would return that to the town.

The district has seen some internal success in managing costs through a new strategy for substitute teachers. Phelan credited Canniff for making hard decisions in the summer to use revenue from unfilled positions to hire building-based substitutes, a move that has so far kept the historically deficit-prone substitute budget under its projections. However, unanticipated facilities issues continue to strain the bottom line, including recent repairs to a hot water heater and an elevator at Tucker Elementary. Chair Amanda Serio supported efforts to better coordinate with town leadership on these issues, agreeing that a more formalized meeting schedule with the Warrant Committee would help clarify the district's needs. It's easier to get an initial meeting scheduled and then have follow-ups on the agenda, Serio noted.