The Portsmouth Town Council and School Committee had a workshop today with the consultants from B&E to hear their findings, and the bottom line is that the Tent Meeting budget underfunds the school system by $770, 167.
There are some potential offsets -- some Medicaid reimbursements, Little Compton tuitions, and cash balances -- which could get the number down around 450K. But no question, the Portsmouth schools do not have enough money to finish the year while meeting the requirements of law, regulation, and contract, according to the accounting expert from B&E.
Even the accountant -- Walter Edge -- cautioned against a full-on Carulo action. "Carulo is not a prudent budget," he said. "It's a what-you-need-to-finish-the-year-budget." That is, he noted, the cash reserves and a couple of warrant items currently designated for capital expenditures might get eaten up all in one year, were there an adversarial Carulo action and a judge was only required to rule on the minimum to get the schools legal for this fiscal year. With the coming RI state tax caps, said Edge, you "don't want to exacerbate" the situation next year.
So where does that leave Portsmouth? The best option, a stipulated agreement where the Town Council and the School Committee go to the judge with a modified budget seems the rational approach. But wait.
The PCC was there, and have hired a lawyer who said that Carulo does not apply in Portsmouth. Based on his reading of RIGL 16-2-21.4, which states that a necessary step in the Carulo process is a negative vote by the Town Council, he argued that since the Town Charter does not allow the Council to amend the result of a Town Meeting budget (and hence, cannot provide the negative vote for additional funding required by Carulo) that the School Committee could not proceed past that point to initiate an action.
Me, I'm no lawyer. That sounds like a really interesting theory, the kind every client is entitled to pay an attorney to come up with. I fully support the legal process, and I'm sure the PCC and their attorney are being honest and professional.
However. As I pointed out at the meeting, this report from a CPA unambiguously states that the cuts the PCC pushed through in the tent meeting were excessive. Had they been willing to compromise -- there were motions on the table that the PCC voted down that would have been in the ballpark of the cuts necessary -- the town would not be in this dilemma.
Larry Fitzmorris, head of the PCC, stated that the tent meeting was "not the place to compromise."
But according to his own attorney's interpretation of the law, since the tent meeting was the appropriate mechanism for re-setting the budget, that was PRECISELY the place to compromise. But the PCC did not. They cut so much money that Portsmouth's schools now face the threat of operating illegally, and they have hired a lawyer to keep it that way.