The Board of Education held the first of two budget review public hearings required by House Bill 65 for fiscal year 2018-19 on Monday, June 25. Total expenditures are budgeted at $33,032,869 while total revenue is budgeted at $32,381,859. The $651K shortfall will be covered by reserve funds.
“Typically,” commented Morgan County Superintendent James Woodard, “when we make these types of projections, we try to hold spending tight and we have pretty conservative projections on revenues so in reality we don’t anticipate pulling anything from the reserves but for budgeting purposes we have to show them.”
Although the state only asks for a 15 percent general fund balance, Woodard stated, “We try to keep our reserves around 35-40 percent of expenditures. This speaks to the conservative approach of our board and being able to have some additional funds for a rainy day.” As a result, the projected general fund balance for the end of fiscal year 2019 is $12,048,990. The board will spend an extra $100K on increasing safety. Notably, the state allocated $40K for safety, the first time the state has taken such measures. As a result, there will be an additional School Resource Deputy (SRD) at every school instead of three rotating between four schools, the Elementary School foyer will be redesigned for a single entry for visitors with a check in system, and fences will be added around the Primary and Elementary School. Additionally, every employee will have a crisis app on their mobile phone to send out alerts in case of emergencies. Parents and guardians will be able to track their child’s bus on route from pick up to drop off through a bus notification app. The latter will allow for updates if buses are delayed due to traffic in the county or when on fieldtrips or when severe weather prevents bus departures.
An eight-year summary delineates how the Teacher Retirement System (TRS) has significantly influenced the budget. Increases in teacher retirement were dealt with by the state rather than local school systems during the recession.
“Since coming out of the recession, starting in FY2018, our local contribution of teacher retirement jumped from 14.27 percent to 16.81 to 20.9,” Woodard stated. “The difference that means for us is that it cost us $804K more dollars this coming year to make the required contribution to our employees for teacher retirement. So, that’s a really big impactor for our system to have to add that much money to our budget.”
In other words, the new budgeting costs will increase 1.03 percent over 2017-1018. However, if one does not include the $804K for the TRS, the board would be $466K under the budget from FY2017-2018.
Board of Education Member and Chief Deputy Keith Howard added that you might not realize “how fiscally conservative our school system is with money, because the state [adds] these additional expenses that they pass down to us.”
Other factors impacting the budget include additional positions that were opened for the College and Career Academy and Full Time Enrollment (FTE) of students, which has tended to decrease over the past seven years. Further, health insurance costs have increased the in recent years as more classified employees – such as bus drivers and cafeteria workers – are provided insurance by the school system.
Information on collection fees, property values, grants received, and the Forest Land Protection Act are also included in the projected budget.
The second budget hearing will be held on July 16 at 5:00 p.m. prior to the board’s regular meeting.