The Milton School Committee’s Finance Subcommittee learned Wednesday that while the district’s projected budget deficit has improved, the school department is slated to shoulder nearly the entire burden of the town’s funding shortfall. Following updated state aid figures and revenue projections, the anticipated "level service" gap for Fiscal Year 2027 has been reduced from $2.1 million to approximately $1.4 million. However, Superintendent John Phelan pointed out a stark disparity in how the town is distributing these cuts across various departments.

According to Phelan, the total revenue gap facing the entire town of Milton is roughly $1.53 million, but the school department’s share of that reduction is $1.4 million. We are taking 91% of the reduction, Phelan said, noting that the Town Administrator’s office is applying an equal 3.29% percentage increase to all departments. Acting Chair Mark Loring questioned the transparency of this approach, noting that while the town claims a uniform percentage increase for all sectors, the underlying logic is difficult to verify. Across the council on aging, DPW, fire, and police, they are not getting various percent increases; it is a black box, Loring said. We asked the town to look at the division of the revenue gap, and they have not done that.

Member Nathan David Hutto expressed strong disagreement with the town’s current allocation strategy. I don't think it really withstands scrutiny, Hutto said. If the town administrator said public safety or DPW were facing specific constraints, I could get behind sharing the burden, but it's a black box. It's hard to understand this justification. The subcommittee also scrutinized a town proposal to delay debt service for the Cunningham School’s fourth-floor renovations until FY28 to save $230,000 this year. Hutto warned that such a move might only amplify future pain, asking if the district should take a little bit of that hit this year to make next year's hit a little less painful given that cuts will only get deeper as the town approaches another override.

The fiscal strain is further complicated by a depleted Special Education Circuit Breaker account, which Business Manager Katie Blake revealed currently sits at just $8,000. Finance experts typically recommend a balance of one full year’s reimbursement—which for Milton would be approximately $3.1 million—to protect the general fund from volatile out-of-district tuition costs. Our goal is to re-establish that balance over three to five years, Blake explained, presenting a plan to reach the $3.1 million target by 2028 through gradual deposits. Phelan emphasized that rebuilding this reserve is a matter of budget sustainability rather than an aspirational goal, as the lack of reserves forced the schools to request emergency funds from the town last year.

Member Bao Qiu advocated for formalizing this recovery plan to ensure it survives future leadership changes. I want to make sure there's follow-through, even if none of us around this table are here in three years, Qiu said, suggesting the committee memorialize the one-year reserve target as official fiscal guidance. Loring agreed, suggesting a policy where drawing the account below the target would require a formal plan for replenishment. Despite the modest improvement in the deficit, the subcommittee warned that the current $1.4 million gap still represents roughly 18 full-time positions. Early in the meeting, the members finalized the mid-year financial check-in. Motion Made by M. Loring to accept the Q2 budget report from the school department. Motion Passed (2-0-0). Member Annamma Varghese and Member Qiu participated in later deliberations and the final adjournment.