Cut is about 2.5 percent of total budget
After several years of a tight but manageable budget, the Greene County school district needs to trim about $500,000 from the budget for 2016-17. The budget, and how best to bring expenses in line with anticipated revenue, was the topic for the board work session Feb. 17.
Complete information about the budget was provided not only to the board, but to staff and members of the community in attendance.
According to superintendent Tim Christensen, the district is now facing cuts that should have been made a year ago. Not making cuts then resulted a negative unspent balance of $244,000 from the 2014-15 school year.
School funding and accounting is complex, and a negative unspent balance doesn’t mean the district is “in the hole,” business manager Brenda Muir explained.
(The legislature sets school districts’ “spending authority,” a figure Muir likened to a limit on a credit card. The Greene County district went $244,000 over the limit and now has to appear before the state School Budget Review Committee (SBRC) to explain how that happened and what steps are being taken to assure the limit isn’t surpassed again. Reducing expenses in the coming year’s budget is one of the steps expected of districts that exceed their spending authority. The meeting with the SBRC is March 15.)
The negative unspent balance is the result of four snafus. There was an audit adjustment of $199,000 in the East Greene bookkeeping related to a change in computer software and working on an accrual basis. There were no funds missing, Christensen said.
There was an error in paying the state teacher salary supplement to the teachers that resulted in the district covering $104,000 in payroll taxes that should have been withheld from the individual teachers.
There was a payback of $174,000 having to do with state incentive money for whole grade sharing that had been paid to the district but later had to be returned to the state.
Finally, Governor Branstad’s veto last July 1 of $55.7 million in one-time funding for schools approved by the Iowa legislature to counter the very modest 1.25 percent in overall state aid was a $145,000 cut to the Greene County district. The 2015-16 budget was formulated using the $145,000.
“The biggest thing I want people to understand is that if we had known about the $199,000 audit adjustment last year, we would have made cuts last year. If we’d have known about the $145,000 when it was that time, we would have made cuts back then,” Christensen said.
The current year budget is expected to produce a negative unspent balance of about $150,000.
Christensen shared possible areas for reductions. He plans not to fill the positions of bus mechanic Norman Zollars, part-time school guidance counselor Becca Johnson, and school liaison officer Justin Guiter, all of whom left the district mid-year. Four staff members – business teacher Tony Beger, elementary secretary Pam Thomsen, elementary custodian Beth DeMoss, and business office assistant bookkeeper Colleen Guillman – applied for the district’s early retirement benefit. Their positions won’t be filled.
Eliminating a building principal is also a possibility. There is currently a fulltime principal in each of the district’s four buildings. The principal positions in the Intermediate School (grades 4-6) and the Middle School would be combined.
Christensen said there is a possibility of sharing the services of curriculum director, the transportation director and himself with other districts. The other district would pay a portion of the Greene County contracts and there could also be state incentives available for sharing.
He explained the different funds within the district’s accounting system, each with its state-mandated source and use. Should a bond referendum pass, the funds would not go into the district’s general fund, but the new construction would allow efficiencies in staffing, utilities and transportation, all of which are paid for by the general fund. “If we can reduce the number of buildings and become more efficient, we save general fund dollars,” Christensen said.
The district has an increased enrollment of 14.5 students for this year, which would equal about $194,000 in additional funds for the district next year should the legislature approve Branstad’s recommendation of 2.45 percent allowable growth.
Christensen said that moving the current teaching staff in the “steps and lanes” on the contract, and with an increase in insurance cost of almost 7 percent, meeting teachers’ salaries next year will cost an additional $117,000, even without an increase in base pay. “If we’re only getting 2.45 from the state and raises are 3 or 4 percent, that doesn’t match up,” Christensen said.
There was state incentive money with whole grade sharing with East Greene and then reorganization, but the 2016-17 school year will be the last year for that, he said.
“Becoming more efficient is what we need to do,” he said before inviting questions from the board. He added that he has spoken to the principals and “there isn’t a list of extra things we’re providing. I think we’re making pretty good use of our resources…. There’s not a lot of fluff. We’re not the only school district experiencing these things,” he said.
Christensen said moving to two attendance centers, both in Jefferson, would save $70,000 in transportation costs. There would be savings in food service and guidance counselors also. “Operating five buildings is just not efficient,” he said.
“The problem with all of that is that it’s three or four years out,” board member Sam Harding said. “We need to get there. That’s the long term in what we need to do, but we lost a year in terms of getting it (the bond referendum) beat once.”
The needed $500,000 reduction in expenses is about 2.5 percent of the district’s total budget. According to Muir, about 77 percent of the school’s budget is salaries and benefits, with teachers’ salaries/benefits being 48 percent of the total. A first year teacher receives about $42,000 in salary and benefits. Salaries/benefits for the superintendent and four principals is 4.2 percent of the total general fund budget.
Board member John McConnell was critical in January of the school entering into a $60,000 contract for mowing and he mentioned that again. He also suggested that WiFi on the school’s activity busses should be eliminated.
New board member Mike Dennhardt questioned how the errors were made that led to not making cuts earlier. Christensen took full responsibility. Dennhardt later said, “I’m into figuring out ways to cut down on bussing, cut down on fuel, and mowing, stuff that would be not getting rid of teachers and superintendents and principals we need. I realize what you’re saying about a new school. It’s big not putting money into these old buildings and the community needs to know that.”
Christensen will consult with building principals and have a proposed budget for the board at the March 16 regular meeting. If teaching staff is going to be cut, reduction in force notices (“pink slips”) must be provided no later than April 1.
He encouraged board members to lobby legislators to adequately fund education.
