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BOE makes change to maximize budget flexibility

Posted Date: 02/11/2020

To maximize flexibility in its overall budget, the Andover Board of Education voted at its February 10 meeting to increase the district’s Local Option Budget authority from 31 percent to 33 percent of its State General Fund budget.

Board members emphasized that they are committed to maintaining a consistent mill levy (property tax rate) and would counteract any potential future LOB increase with a corresponding decrease in the capital outlay levy to ensure that the overall mill levy remains stable.

The change provides two advantages for Andover Public Schools:

  • Capital outlay funds have restrictions on how they can be spent, including leases, equipment, software, uniforms, maintenance and capital expenditures. LOB funds do not have those restrictions, which provides budget flexibility.
  • The capital outlay budget currently receives 47 percent of its aid from the state. LOB funds currently receive 57.36 percent in state aid. This means Andover will have the authority to capture a higher percentage of state aid by increasing the LOB and offsetting the increase with a reduction in the capital outlay levy, thus reclaiming more of the funds local taxpayers send to the state.

Administrators stressed that just because the district has the authorization to increase its LOB percentage doesn’t mean it is required to do so. Currently, 101 of the state’s 286 districts have their LOB authorization set at 33 percent. The Board of Education retains ultimate approval for annual LOB authorization and the overall district mill levy.