Barren County school officials will address budgetary issues with state legislators Saturday during a joint meeting at Glasgow High School with the Glasgow and Caverna boards of education.
Legislative action can significantly affect the budgets of local school districts, and officials anticipate cuts in spending for the 2015 school year. Barren County Schools Superintendent Bo Matthews told school board members Thursday night that personnel and programs will more than likely be cut.
“I hate to begin the meeting with painting a picture such as this, but the funding situation, given our increased expenses [and] with reductions from the state and federal levels, we are going to have to reduce spending levels anywhere between $1 million to $1.4 million for the coming school year,” Matthews said.
John Stith, district finance officer, reviewed the draft budget, which shows $36.4 million in anticipated revenues for the 2015 fiscal year and nearly $38 million in expected expenditures.
Stith paid close attention to the general fund because it’s the one fund district officials can project for the coming school year.
The general fund’s beginning balance for 2015 is expected to decrease to $1.2 million from $1.5 million in fiscal year 2014.
“We have a number of things going on this year that may force us into reducing the contingency fund] this year,” Stith said.
He told school board members he won’t know for certain if that will happen until he receives more information in the coming months.
In regard to revenues, Stith told board members that most that were included in the general fund are running close to what was anticipated.
Support Education Excellence in Kentucky, the school district’s primary source of state funds, could be impacted by the state legislature. Stith has budgeted about $19 million in SEEK funding.
“We are basing the SEEK number right now off the $4,352 [average daily attendance] and the per pupil base of $3,827,” Stith said.
District officials won’t know exactly how much SEEK funding the state will allocate until after legislators make a decision regarding the overall budget, he said.
District officials hope the capital outlay fund is roughly the same in the upcoming fiscal year – about $300,000 that can be used to reimburse the general fund for maintenance and insurance expenditures, Stith said.
More money is expected for step increases on salary schedules for certified and classified employees.
“Every year, as you gain more experience, you move up on the salary schedule,” Stith said. “That is moving everybody up one level on the pay scale. That number can change a little bit, depending on the number of retirements that we’re to experience.”
The anticipated cost for step increases is around $330,000.
“When you take a very experienced teacher with 27 years and you replace them with a new teacher that can be a significant savings,” he said. “We will have more information on that in the next couple of months.”
District officials are also expected to spend more for the preschool program in 2015 due to a lack of state funding because enrollment numbers are down.
“We are anticipating about $167,000 increase in preschool costs potentially,” Stith said.
Another expenditure will be the employee retirement system.
“In order for our employees to have health insurance when they retire, the state is not going to be able to afford that, so the deal was struck that if employees pay an additional 3 percent, employers will pay 3 percent more. We will continue that benefit,” Stith said.
The district expects to pay about $130,000 for employee retirement.
Stith also told board members that if a $25,000 grant for the Barren Academy for Virtual and Expanded Learning, an online high school, is lost, the district will have to cover the cost with money from the general fund, he said.
The district also has a rural schools grant which covers the cost of some staff members’ salaries. The grant is not one district officials feel they can receive each school year, so when the grant funds are spent the district will have to pick up that expense as well.
An increase of $150,000 in district administrative support is also anticipated for the new fiscal year.
“For a district our size, the bulk of our expense is in personnel, so more likely than not we will have no choice but to have some type of personnel reduction,” Stith said. “When you do that, [it] helps on the expense side, but unemployment insurance has a tendency to go up.”
With the reduction of staff, district officials are also anticipating an increased cost for accrued sick time. When employees retire, the district pays about 30 percent of their accrued sick time, he said.
District officials are also anticipating increases in maintenance expenditures of about $47,000, plus $98,000 in student transportation and $30,000 in bus maintenance.
“So in the draft budget we are projecting a total of $29,505,571 in total expenses, less the contingency. Total revenue, less beginning balance [of $1.2 million] will be $28,149,705 for a difference of expenses over revenue of about $1.35 million,” Stith said. “Over the next few months we are going to be looking at ways to reduce expenses and hopefully, if the General Assembly can provide some relief, it may be a combination of some additional revenue and reductions in expenses.”
The district’s budget can also be affected by the federal government.
“Hopefully, over the next couple of months we will have better information of what that will look like,” Stith said. “However, worse case, if the sequester stays as it has been, we are looking at somewhere between a 5 and 10 percent cut to federal programs, which is roughly about $2.2 million for us.”
Two federally funded programs that could be affected are the Individual Disability Education Act and Title I.
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