Basics of our district funding

To all my blog readers, I am going to try and explain the school budget in a way everyone can understand, at least as close to as well as I understand the budget. I am starting to write this while I am on vacation in Jackson. I had hoped to publish this after our budget work meeting, but lacked some details I wanted to have before I could explain things very well. I called and got more answers to the budget questions that I had, but was advised to wait to publish anything until after the budget details are published on June 7th a week before the board meeting. There is some concern if I publish something different than what the final budget is, it would be inappropriate, and could cause some problems. So I will wait and publish this after that date, even though I am going to write most of the information while I have time, and then I will go back and edit numbers where it's necessary.

 First of all I am not going to try and publish exact numbers. I don't think that is necessary to explain the budget. As with many budgets, especially my own business budget, no budget ever comes out exactly as planned. There are many variables in how we get our funding. When you depend on most of your funding coming from the state and federal governments, there can be many variables. Things like how many students we have and how high our attendance is can make a lot of difference. So consider the numbers I write as estimates, I will give more exact numbers and more details as I learn them later. Even the amount of students that qualify for free and reduced lunches effects our funding. We are going to get a grant again next year to pay for an afternoon nutrition break in the elementary, which really helps those kids make it through the longer four day schedule. We qualify for this because of the percentage of students that qualify for the free and reduced lunches. This also effects the money we get for aides under the federal funded title 1 program that helps educate disadvantaged students. So it is very important to have patrons fill out the paperwork to see if you qualify for this aide even if you choose not to participate. This fund is about $98,000 and can only be used to help disadvantaged students. These funds used to help pay for summer school. This fund is less than it used to be, and no longer is enough to cover the summer school program, so we were forced to cut it. I hope at some point we will be able to come up with the funding to bring this program back.

 Since I started with federal funds I will continue with them. Another fund is called the Title VI-B School-Age fund. This fund goes to the students identified as having special needs. There are about 80 students identified for help under this program. Many of these students have problems reading. Students are tested to see if they qualify for help and a plan called an IEP is written to determine what help is necessary. The school is required by law to provide whatever help these students need even if we don't get enough federal dollars to pay for it. There are some students that require one on one aide that we have to pay for. The money we receive for this program doesn't cover all the costs we have, and can change from year to year depending on what the needs are. The funding for this program is about $167,000. There is another similar program for preschool children ages 3-5. This past year we had 11 students in this program. They have been identified as learning delayed. This funding has been about $17,000.

 Another federal fund is called Perkins Vocational Education. This is a program for vocational education, or also called professional technical education. I understand many years ago we used to have certified nurses assistant education which was part of this program. This fund is only $8,000.

Another federal fund is called Title II-A Improving Teacher Quality. This fund helps to maintain small class sizes in grades K-3. It can also be used to better train teachers teaching those grades. The money we get is about $30,000. For us we use this money to help fund a teaching position.

 The school food service is partly funded through Federal Funds. The lunch ladies do a very good job managing the lunch program. There has been a lot of changes in nutrition programs with more to come. With the Federal Funds and what is charged for the meals this is a self sustaining program. We used to have to supplement this partly with General Fund dollars, but that hasn't been necessary for at least the last two years. The only cost is the requirement by the state for us to pay the FICA taxes for the lunch employees. The cost of this is $6500.

 All these federal funds can only go to their intended purpose, we can't use them in other areas, and in some cases require us to supplement them from our general budget funds.

 Now on to the state and local funding. There are two Plant Facility Funds. One for Non-Student Occupied Funding and one for Student Occupied. We are required to put 2% of the value of our buildings and I think other fixed assets into these funds. I'm not quite sure how this is calculated but it amounts to somewhere between $165,000 to $180,000 each year. Part of the funding comes from the ten year Plant Facilities tax levy we passed last year for $95,000 each year. The major expense out of this fund is for buying buses. A bus costs over $80,000. We used to buy one bus a year, but in recent years have bought one every other year. Last year's audit report listed the Non-Student Occupied Fund at $650,000 and the Student Occupied Fund at $290,000. The Student Occupied (SO) Fund is what we used to buy our high school bleachers. They cost around $121,000. Each year the Administrators come up with a wish list of repairs and replacement projects, that are funded with these funds. Other examples of SO funds are desks and tables for class rooms, new carpeting and painting. There are many projects that need done in restrooms and locker rooms. There are also some projects that need done in the school kitchens. We try to maintain a good balance to cover major expenses that might come up like roof repairs or replacement, or what you might call the dreaded elementary boiler failure.

 Some examples of Non-Stuendent Occupied expenses are work that is needed around the baseball and football fields. Whatever we decide to do with the area between the high school and seminary building and any work on asphalt, or painting asphalt. The elementary needs work done around the play grounds. The middle school needs work around the berms to prevent water from getting into the school. These items will be prioritized and it will be determined which projects to complete this year. But to restate, we are required to fund it at these levels, and the fund can only be used for these type of projects. The Plant Facilities Levy money makes it a lot easier to fund this account, so the $95,000 doesn't have to come out of the too little general funding we get.

 Another state fund is called the Vocational Technical Fund. This fund helps pay for the Professional Technical Education programs, like the Ag programs, clerical, consumer homemaking and child care programs. It also includes technology and informational training, and the equipment to run these programs. We get $34,000 from this state fund. Not near enough to provide all the funding necessary for these programs, but it helps.

 We also have some funds that help support the Drivers Education Program. We get $125 per student and charge the students $75. This has been provided three times a year. Years ago we used to have a car provided rent free from a car dealership, but no more. I think this is basically cost neutral, but the car is very old and I don't know what we will do when it's too worn out to use anymore. I understand the cost for private lessons is around $300.

We also have a Property Tax Bond for the middle school. It is for about $250,000 each year, and pays off in June of 2014. As I have stated before I had hoped we could get by on our budget without trying for another levy until our bond pays off. At that point I hope we can propose a levy for about the same amount to better restore our funding, maybe bring back programs we have cut like summer school, and to bring our contingency funding back up to better levels.

The major part of our state funding is for our teachers and administrators. We are funded 1.1 teachers for every unit of students we have. I have explained what consists of a unit in the past. We have 41.5 units that can fund about 45.5 teachers. But because of funding cuts, the state allows us to reduce our teachers by, I think, up to 9% and use that extra money to help fund our Maintenance & Operation budget. This next year we will have 41.5 teachers. We are funded 3.1 administrators and have 3. Our teacher payroll is about $2,232,000. Our administrators are funded at $182,000 and we pay out $208,000. Because we have tried to keep from dropping our teacher, administrator, and other staff salaries too far. We pay out a total of about $78,000 more for all our staff than we get reimbursed for. I think the staff has had a series of pay cuts over at least the last three years, because the state keeps cutting the funding. We have tried to cover the cut from last year of about 1.67%, partly by reducing staff and using some of that funding to supplement the rest.

 Now I finely come to our General Maintenance & Operation fund. This is an area where we have had major cuts from the state. This is only about 10% of our total budget. This is used for general funding, salaries, benefits, supplies, training, textbooks, classroom equipment, administrative costs, utilities, maintenance, general upkeep, and transportation. We used to be funded about $24,000 per unit. This past year it had dropped to $19,626 per unit. If you heard on the news from Tom Luna that they have funded our schools better for next year, this funding will go back up by only $80 per unit or a grand total of $3,320. Shouldn't we all be grateful, but I digress. The M&O estimate total for next year is about $818,000. This is often referred to as our discretionary funding. But in reality most of this isn't really discretionary.

 The state provides us a benefit apportionment that provides the FICA and Persi benefits for our staff which is estimated at about $403,000. We have to pay for the rest of the benefits, like insurance, from the general fund and that amount is about another $460,000.

 Another big chunk of the M&O budget is for electrical and other utilities. Also for garbage removal and janitorial services. The budget for these services for next year is estimated at about $360,000. This fund is also used for textbooks, computers, and other things I mentioned earlier. So as you can add this up, the M&O budget isn't nearly as high as it needs to be. As I have said in the past, Senator Bair says they will eventually get this funding back up to the $24,000 it used to be. But if they don't increase it more than $80 a year it will take a long time to get there.

 We are also projecting a transportation allowance from the state of $185,000. The state reimburses us 85% of the cost from home to school, and only 50% for shop supplies and other costs. They don't provide any funding for field trips, athletics, or any other activity.

 We get a token amount from the state that is supposed to replace some of the property tax funding we used to get through AG taxes. This amount is estimated at about $17,500, and is added into our M&O Budget.

 As far as I know this is the total funding and where it goes. This is very long, but I hope for those interested you found this informative and now better understand our budget. There are other things like depreciation and other details I still don't understand, but this should explain most things. Last year we had a deficit budget of $232,000. I don't know the details of how we ended up, and until our annual audit in August we won't know the final numbers. But I can say we did much better than projected. Everyone needs to give our management team a lot of credit in how the budget was managed. We have a history of being conservative as a board and administration and being that way has really helped prepare us for these lean times. I can't forget the help we get from the PTO and all the teachers and patrons that donate their time and money to help our schools. We will still have a negative budget, but not really bad. If I remember right from what I have read, we are one of only a handful of districts that don't have a levy. One comparison to make is with Aberdeen. I think they have close to the same number of students that we have. I think for at least the last two years they have approved a $600,000 levy for each year, and are projecting a contingency fund of only a few hundred dollars. We started the last school year with over $800,000 in our contingency fund. Thanks again for your support. If you have any questions let me know and I will try and answer them. If you have comments or other input, I would welcome that also. I wish I could publish this tonight. Other than some editing I actually finished this at 12:30 a.m. on May 30th. I don't think what I have said would be a problem, but since I told them I would wait I will. Brian

 Last night I received the budget notice from the district office. If there are differences in what I was given last week and what was sent to me last night, they aren't much different. I have provided a lot of details to explain our budget, but keep in mind all my numbers may not be exact. I was given an estimate of what we will use out of our contingency fund and about where our budget ended up this year, but I will wait until after our budget meeting next week to provide those numbers, in case the board does something different that might change our budget for next year. This information is something I have wanted to understand and share for a long time. Thanks again. Brian