Stonington — The Board of Finance on Wednesday approved a proposed 2020-21 budget that calls for no increase in the current 23.36 mill tax rate but initially decreases the school budget by $500,000.

Some or all of that money, though, could be returned to the school system if the state aid remains at the projected $1 million or if the school system returns more than the $350,000 it projects to return to the town from its current budget.

Finance board members created the sort of insurance fund because they fear the town may not receive some of its state education aid due to the state's worsening fiscal condition. They told school officials the fund, which would be controlled by the finance board, would be better than the school system having to absorb a large cut partly through the school year that the town would not be able to offset.

In addition, finance board members said their plan creates an incentive for the school board to find even more savings in its current budget. They also pointed out that the schools do not need their entire allocation at the beginning of the school year, giving the town time to see the fiscal impact of the COVID-19 pandemic.

But school officials said they have to finalize a budget and make decisions on programming and staffing now.

“To take $500,000 out of our budget now would be devastating to our schools,” Board of Education Chairwoman Alexa Garvey told the finance board.

She added the reduction means the school board will now have to eliminate 10 teaching positions.

“Let the BOF (Board of Finance) deliver the layoff notices in person,” teachers’ union President Michael Freeman posted in the comment section of the board’s Facebook Live meeting.

Finance board members Bob Statchen and Mike Fauerbach voted against the budget, citing concerns about the $500,000 school budget reduction.

Much of the finance board’s 2½-hour meeting concerned the $500,000 fund proposed by board member Lynn Young, who said she was trying to help the school board by creating an insurance fund in case state aid decreases.

“I’m trying to make you think about this, that you’re going to get a pretty good haircut (from the state),” she told school officials.

But Garvey said the school board would make necessary cuts if, and when, state aid decreases.

Young responded saying that each year the school board “has large sums of money left,” adding there is no transparency in the school budget.

One of the other items the board cut was the $15,000 to formally close the North Stonington Road bridge. Finance Board Chairman Tim O’Brien said not closing the bridge will give the town more time to consider its options.

The bridge has been closed since the March 2010 flood and neighbors and Old Mystic Fire Chief Ken Richards have pressed for the town to replace it. But First Selectwoman Danielle Chesebrough did not include the town’s $318,000 share of the work in the proposed budget and called for its permanent closure.

O’Brien ended the meeting by saying all his members have the best interests of the town in mind but with so much uncertainty, they are trying to make assumptions about something no one has seen in 100 years. The town does have $12 million in its undesignated surplus fund to deal with emergencies.

Chesebrough said she plans a joint virtual meeting between the boards of selectmen and finance on May 12, at which time the selectwomen will approve the $71.5 million budget and the finance board officially will set the tax rate. There will be no town meeting and referendum vote on the budget, due to the COVID-19 pandemic.

An executive order by Gov. Ned Lamont allows municipalities to adopt budgets without going through the usual process of town meetings and referendums, which involve large numbers of residents congregating in small spaces.

j.wojtas@theday.com