Monday, February 14, 2011

The budget situation . . .

During our monthly meeting with TEA today, it was said that there are probably many staff members and others that are not aware of the budget cuts that the district will experience this year. That came as a surprise to me because I am so close to it that I simply don’t think about how and why others wouldn’t know. We have shared the cuts with our board and with the administrative team, but not publicly in ways that others would see and understand. So, though I don’ have a lot of people that regularly read this blog, I’m going to start the sharing process right here.

This year is unprecedented in my history as a superintendent with significant revenue cuts being administered during the budget year. From year-to-year we have experienced cuts to non- basic education programs, but not in a year that we have arrived at a balanced budget based upon promised state revenue. Below, is a summary of the proposed cuts based on the Governor, house and senate proposed budgets.

These potential cuts are partially offset by the state distributing the Edujobs federal money to each district. For us, this revenue that we were aware of during the budgeting process, but did not include in our revenue to expenditure comparisons amounted to $1,477,000. If we had budgeted the use of this money, as some districts did, we would be in a much more difficult situation than we now face. Other factors that mitigate against the cut are enrollment and Safety Net revenue above budget projections. The other important variable is that we had already made the decision to use part of the fund balance in the 2010-11 budget, something that becomes more difficult to do in future years. With this additional revenue, we should experience an actual cut of between $119,000 and $269,000 far less than we anticipated earlier in the year and before finding out last week about the additional Safety Net revenue.

Given the process in Olympia, however, we know that there will be much bargaining over the three budgets and that only one budget will finally emerge identifying the cuts for this year and the revenue projections for next year. At this time, based on the three proposals, we believe that we can make it through this year without significant changes to expenditure projections. Next year, however, will present us with a more difficult situation that may once again require adjustments to our program similar to what we experienced in the 2009-10 school year. This is because of the anticipated state cuts and because we used $1,050,000 in fund balance for this year’s budget, something that will be more difficult to do in future years as the fund balance is depleted to balance a given budget. Since we have little capacity to increase revenue the budget balancing alternative is program cuts.

Unless there is a dramatic change from the three proposed budgets to final budget we will be alright this year because revenue is above projections. This additional revenue, with the Edujobs money came close to covering the proposed cuts.


Scott Mitchell said...

Thank you for sharing this Mike. I think that many people read the paper or see the news but do not know the direct affect on our district. It is good for people to see what the current cuts to our district are. The people are informed the better.

jdunham said...

Thank you for keeping us up to date on how the proposed budgets in Olympia will affect our district. All the different proposed education cuts make it a little scary to be a teacher right now. It is a relief to hear that we are in a pretty good position at this point.