Finance Chief explains reasoning behind school budget
Thursday, August 7, 2008
School board members and district officials outnumbered audience members during a public budget workshop Wednesday evening at Mary Herbert Education Center.
Assistant Superintendent for Business Rob Scheib explained details of the budget, and the reasoning behind the numbers used to reach the $32,139,693 that officials hope will be needed for the 2008-09 school year.
The budget as presented will require no increase in the mill levy required to finance the district. The rate will be the same — 49.317 — as in the 2007-08 school year. Scheib said that a mill, based on current valuations, equals about $157,000 for the general fund.
The workshop information, accompanied by a PowerPoint presentation for illustration, was similar to one Scheib had presented in July to board members.
He reiterated that district leaders hope the student population will not be drastically affected as had been feared when Tyson Foods announced in January that the slaughter division, as well as the second-shift processing operation, would be eliminated at its Tyson Fresh Meats plant here.
“We’re hoping for the best with this budget document, but we’re also planning for the worst,” Scheib said.
The best-case scenario would be a minimal loss of students of Tyson parents who may have moved out of town to find work. The full effect of Tyson’s downsizing will not be known until Sept. 20, when the state’s department of education needs a student head-count to determine the full-time equivalency in all Kansas school districts.
The problem for the Emporia district is that Kansas also requires that budgets be submitted to the state by Aug. 25.
District officials estimate that 4,538 students will be in class for the Sept. 20 count. In 2007, the estimate was 4,636, with an actual audited FTE of 4,601 for that year.
The state counts kindergarten students as part-time students, although the district has full-time kindergarten classes.
The district has built-in ways to accommodate a loss in students; however, schools must be prepared with teachers and other staff members to handle all incoming students.
“You need to have an adequate budget if all the kids show up,” he said.
Scheib, who joined the Emporia school district on July 1, said that some trimming of expenses already had been approved by the school board during a meeting this spring, and $125,000 from the construction fund was transferred to the bond and interest fund to help avoid a 1-mill tax increase for the 2008-09 school year. The latter was a one-time transfer, leaving the construction fund’s balance near empty.
“We will have $1,501 left in the construction fund, so you can see it’s not a well we can go back to for another drink this year,” Scheib said.
The district’s funds have been lowered by several actions taken by the legislature and by local banks.
While funding increased for special education and at-risk students, weighted monies that had been allowed for virtual-school students were eliminated.
“Even though Emporia was doing a very good job of the way they were running their virtual school, it was not universal; that was not their findings everywhere,” Scheib said.
Interest rates on invested idle funds also dropped precipitously.
Eleven months ago, the district could gain 4.06 percent on idle funds invested for 1 to 89 days. That now has dropped to 2.04 percent, Scheib said.
Three-month investments took a deeper cut, going from 4.05 percent last year to 1.68 percent this year.
“That 1.68 just hurts,” Scheib said. “You can’t look at that number and not feel something, to go from 4 percent down to 1.68 percent.”
The district also may lose money because of its students’ improved performance on assessments that showed the district made Adequate Yearly Progress required by the No Child Left Behind act. The more students who meet AYP means less additional federal funds coming to finance remedial programs.
“We reap the reward of a penalty for doing that,” he said.
Local legislators saved the district for the upcoming school year by getting their colleagues to agree to pass a bill providing a 98 percent floor for the Emporia school district for this year only. The floor, needed because no accurate predictions could be made on student numbers, allows the district to receive $30,771,226 in state aid. It also gives the district time to plan for financial needs for the 2009-10 school year, when student numbers should be more predictable.
The Food Service and Transportation department budget numbers already are being skewed by the increased costs of food and fuel.
Bill Barnes, an Emporia State University business professor who attended the hearing, complimented Scheib on his orderly presentation of the figures and the reasoning behind them.
During the public hearing held after the workshop, Barnes requested, for the fourth consecutive year, that the Emporia superintendent and board encourage the state board of education to simplify its financial process and eliminate the numerous special funds and the rules governing them.
“The budget in front of you is incomprehensible for the average person, and I consider myself that,” Barnes said. “… Due to the complexity, you’re probably spending more staff hours than a normal business would spend on a similar type process. It’s money that does nothing to add to education in the community.”
Barnes asked that Superintendent John Heim invite any legislator from the state to come to Emporia and explain the budget and where their tax dollars go.
“There’s probably not a handful in the whole state of Kansas who could explain to you where this money is going and why,” Barnes said.
Heim responded that he has asked legislators every year to improve the budget structure and reduce the number of restricted-funds line items. He has not yet found success.
“Every year, they’ve added a fund,” Heim said.
Summer_Breeze (anonymous) says...
Thanks to the school district for a no-mill-levy-increase budget! Well done.
August 8, 2008 at 9:55 a.m. ( permalink | suggest removal )