POTSDAM - With state aid expected to remain the same and significant increases expected for health insurance and pension contributions, the board of education here is eyeing a $1.5 million budget gap.

“This is our starting point, a $1.5 million gap,” Superintendent Patrick H. Brady told school board Finance Committee members J. Patrick Turbett and Thomas W. Hobbs Thursday night.

Business Manager Laura Hart went over initial budget projections, noting health insurance expenses are expected to rise 9.5 percent, an increase of $450,000, and pension payments are also expected to increase by approximately $400,000 across the district.

“The pension costs alone are more than the tax cap,” Mr. Brady said.

Without any cuts the district is looking at spending $9,092,000 on salaries, $7,925,404 on benefits, $5,140,794 on BOCES expenses, $3,391,000 on debt service payments and $2,388,871 on “other,” which makes up everything else in the budget.

Even without making cuts, Ms. Hart said at least one of those numbers, BOCES spending, will change.

“When I do this at this time I always use 5 percent,” Ms. Hart said, adding the number is later adjusted after the district had a better idea of what services they’ll be requesting from BOCES next year.

Ms. Hart also noted that at this point the district has not received any preliminary state aid estimates, but Mr. Brady said he’s not expecting to see much of an increase.

He noted that last year state aid increased by 4.1 percent. That increase translated to approximately $25,000 for the district.

Based on the governor’s estimates for this year from last year’s two-year budget plan, Mr. Brady said state aid is expected to increase $711 million or roughly 3.5 percent across the state.

“Much of that is categorical increases,” he said referring to BOCES aid and transportation aid which simply reimburse district for what they spent last year.

Another $50 million of that is also allocated for the governor’s competitive grant program.

“Why put more money toward competitive grants when you have schools facing bankruptcy?” Mr. Brady asked.

And even though the governor has already released that estimate, Mr. Brady said he’s not so sure that estimated increase will actually be the numbers released by the governor when he released his budget plan.

“With Hurricane Sandy, that is a big question now. Will the aid stay at that percent?” Mr. Brady wondered. “There’s a lot of questions about that projection.”

Making matters worse, Mr. Brady relayed to the board a quote he read from Governor Andrew M. Cuomo.

“For those expecting some kind of state bailout, forget about it,” he said, attributing the quote to an article he read in the Albany Times Union.

“At the same time we’re putting the budget together we’re also working on advocacy,” he said, noting a group of concerned parents, many from the Canton and Potsdam Central School districts will be headed to Albany next week.

“It’s great to have the parents from Canton and Potsdam involved,” he said. “I think their voices resonate more with the legislators far more than ours.”

One bright spot Mr. Brady mentioned is legislation proposed by Assemblywoman Addie Jenne Russell that would reformulate the state aid formula, steering more money to schools in need.

“There will be some debate on that for sure,” Mr. Brady said. “The distribution problem is very political. No matter what the wealth of a district is everyone expects their share.”

That being said, Mr. Brady applauded the assemblywoman for her efforts.

“I give her credit for stepping up to the plate and putting up some legislation to try and help us.”

Mr. Turbett, who serves as finance committee chairman, said the best thing district residents can do to try and help the district is make their voices heard.

“The best thing that taxpayers can do is advocate for themselves and that means advocating for more school aid,” he said, adding Potsdam is represented by Ms. Russell in the Assembly and state Senator Joseph A. Griffo.

Letters to Ms. Russell may be sent to 70 Main St. Suite One; Canton NY 13617 and letters to Mr. Griffo may be sent to 207 Genesee St. Room 408; Utica NY 13501.

Using flat state aid numbers and a preliminary tax cap calculation, Ms. Hart said she estimates the district could increase their tax levy by 3.38 percent while staying within the boundaries of the state tax cap.

That number would give the district a tax levy of $11,775,179 an increase of $384,908 over this year.

Those numbers also include use of $450,000 in reserves and $1 million in fund balance.

While the board hasn’t had any conversation yet about whether or not to exceed the tax cap, Mr. Turbett said unlike last year, taxpayers are already looking at a large tax rate increase thanks to the county’s budget.

“Unlike previous years, everyone is already going to have a big tax increase in January,” he said. “That doesn’t help us.”

He continued, “It doesn’t look rosy, but I’m sure we’ll work it out one way or another.”

Mr. Brady said working it out is becoming increasingly difficult, noting the district has already cut 18.5 teaching positions, 25.9 support staff and 1.3 administrative staff dating back to the 209-2010 fiscal year.

“I’ve given you a seven page list of things we’ve done over the past few years,” he said, referring to a list of all the positions that have been cut and their impact on the district.

“Those decisions were difficult, but it’s getting extremely difficult to make further cuts,” he said.

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