Home BusinessFinancial Shelton school district could face $3M health insurance deficit

Shelton school district could face $3M health insurance deficit

by Cedric Guzman

The Shelton Board of Education is facing a potential deficit of over $3 million in their school health insurance spending, according to city Finance Director Paul Hiller. The board has already spent $2.8 million in the first two months of the current fiscal year, surpassing the budgeted $8.1 million for the entire year. If this trend continues, the estimated spending for the year could reach $11 million.

Hiller presented this update at a recent Board of Education Finance Subcommittee meeting, just weeks after the board discovered a $2.6 million overage in health insurance spending for the previous year. School Finance Director Todd Heffelfinger noted that health insurance costs in July and August were 23.9% higher than the same period last year. The district has been spending $260,000 more per month than budgeted, resulting in a projected $3.1 million overage if the trend persists for the next 10 months.

In response to these projections, the school board, school administration, and Mayor Mark Lauretti have scheduled a meeting on October 19th to discuss the situation. While there is hope that the numbers could decrease, board member Diana Meyer expressed concerns about a larger deficit and the potential burden it would place on the city and taxpayers. Meyer suggested that the deficit could climb to $4 or $5 million, which could lead to staff cuts as the only option to cover the shortfall.

It’s worth noting that the city is already dealing with a deficit from the previous fiscal year, which has been estimated at nearly $2.8 million. The city’s finance office released these numbers last month, prompting an audit of the school district’s books by David Cappelletti of Clemont and Associates, LLC. The auditor’s report is expected in December and may reveal a decrease in the deficit, potentially by as much as $1 million.

The combination of both deficits highlights the pressing financial challenges faced by the Shelton Board of Education. Finding a solution to the health insurance overages is crucial to maintain the quality of education while also managing the fiscal health of the district. The upcoming meeting will likely shed light on potential strategies to address these financial issues and ensure the long-term sustainability of the school system.

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