City Audit Good News for Norwalk Education Funding

City Audit Good News for Norwalk Education Funding
Posted on 02/11/2020
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Audited City Financial Report Could Be Good News for Norwalk Education Funding

An unprecedented increase in what is the largest unallocated fund balance in the State of Connecticut could be good news for families and schoolchildren throughout Norwalk. 

An audited report on the City of Norwalk’s finances confirmed that Norwalk’s unallocated fund balance rose by $12 million over the 2018-19 fiscal year, thanks to the growth in city revenue.  The Comprehensive Annual Financial Report for the Fiscal Year ending June 30, 2019, was transmitted to Mayor Harry Rilling, the Common Council, and members of the Board of Estimate and Taxation on December 27, 2019, and includes the independent auditor’s report prepared by RSM US LLP.  

“We commend the Mayor and Common Council for actions they have taken to grow revenue and the city tax base,” said Barbara Meyer-Mitchell, chair of the Norwalk Board of Education Finance Committee. “We are hopeful that the City will take advantage of this unique opportunity to help close the opportunity gap for Norwalk children.”

According to the report, the Unassigned portion of the city’s General Fund (the primary operating fund) is now at $69.7 million, an increase of $12 million from 2017-18. Commonly referred to as the rainy day fund, the resulting unassigned fund balance represents 18.3% of total revenues, above the 15 percent recommended by city policy. Even before this year’s increase, the rainy day fund has been more than sufficient to retain the city’s Aaa/AAA bond rating from the country’s three major rating agencies. 

“A strategic portion of the education budget increase could be funded from the rainy day fund, without significant tax impact, if handled in a sustainable manner.  By paying for one-time costs in the budget from this fund, we can achieve our educational goals,” said Dr. Steven Adamowski, superintendent of schools. “Norwalk spends $1,245 less per pupil than Stamford, and $2-3,000 less than our surrounding neighbors, yet more than 50% of Norwalk students are eligible for free and reduced lunch, and Norwalk also has a higher number of special needs students and English learners than all of these districts including Stamford. This is a unique opportunity to provide justice and equity for all Norwalk students, and to make up for the historic underfunding of Norwalk schools.”

Budget goals in the Board of Education’s budget request for 2019-20 include funding for salary and benefits increases included in collective bargaining agreements, an appropriation to accommodate growing student enrollment, and the expansion of choice programs, including an enhanced program at Kendall Elementary, the historically lowest performing school that serves the largest number of Norwalk’s high needs students. Funding is also included for after-school programming, increased transportation costs, the expansion of summer school for students who need academic support, the addition of a world language to help students meet new graduation requirements, and improvements to school counseling services and social emotional learning support. 

The complete audited report is available to the public in the Finance Department section of the City of Norwalk website.