board members have big budgetary decisions to make in the coming months.
On the one hand, the district is expected to see a roughly $7.8 million surplus from the 2011-12 budget thanks to more efficient transportation routes, decreased utility bills and other cost-control measures. An audit, which will determine the exact surplus, is scheduled to begin next month, but district officials said the revenues should exceed expenses by between $7 million and $8 million.
On the other hand, the district is anticipating an $8.1 million deficit in the upcoming 2012-13 budget.
Superintendent. John Harper said at a special school board meeting on Monday that the school board needs to decide if it is willing to adopt a budget with an $8.1 million deficit or see what type of cuts should be made to erase the deficit.
Harper said the school board could use the 2011-12 surplus to help dig the district out of its upcoming deficit, but doesn't recommend it because there are so many uncertainties right now on how much funding the district will receive from the cash-strapped state. The likelihood of the state shifting its teacher pension responsibilities to local school districts will cause “a slow death” to districts across the state, Harper said.
Now, the $7.8 million anticipated surplus is being added to the district’s fund balance, which gives the district about a $30 million reserve, according to Angela Smith, the assistant superintendent for business and operations.
With monthly expenditures at about $18 million, the district only has less than a two-month reserve. Ideally, Smith said, districts should have about a six month fund balance, but the district is shooting for a three-month reserve.
District 202 is one of 11 percent of districts statewide with less than a three month fund balance, Smith said.
School board members on Monday said they would like to see what non-personnel cuts can be made and what impact those cuts will have on education.
Board members said they would also like to see some or all of the $7.8 million surplus going towards reducing the 2012-13 deficit. They also indicated they would like to see a long-range plan developed to build up their fund balance to a 90-day cushion.
“How do you build a fund balance when you are deficit spending?” said board secretary Eric Gallt.
No vote was taken Monday.
The budget will be put on public display Aug. 10. A public hearing is scheduled for Sept. 10 and the board plans to adopt the budget on Sept. 24.
The board can amend the budget when it learns more about the state’s pension funding plans as well as when it sees a list of proposed cuts and their impact.