By Charlene Bielema
Herald Editor
January 12, 2009 09:56 am
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CLINTON — On the heels of a 1.5 percent budget cut mandated by Iowa Gov. Chet Culver, the Clinton School Board is now working on a 2009-2010 fiscal year budget that has a lot of unknown variables.
For instance, while board members and district staff are wrestling with cutting $342,000 from this year's $24.2 million general operating budget — even as the district is living it out — board members are faced with the possibility of even more cuts this year if the state decides that needs to happen.
Then there’s the possibility that the Legislature, which has earmarked 4 percent in allowable growth for the 2009-2010 fiscal year budget, could come back at any time during the session, which begins today, and cut the funding to 2 to 3 percent.
And while the district is not yet sure what its revenue will be, it also is not sure how expenses will shake out. Contract negotiations with the Clinton Education Association are under way and it is not yet known what the unions will want for a salary and benefits package and what roles increasing insurance costs will play.
All of those budget components were discussed Saturday during a Clinton School Board budget workshop. During that meeting, board members were given an overview of the budget process, a definition of terminology, deadlines and how the process will move forward as the board works to certify a budget by April 15. After the board completes its work, the budget will be forwarded on to the Department of Management and the Clinton County Auditor's Office.
But the board was told there will be a lot of work to get from here to there.
During the presentation, made by Gayle Isaac, the district’s business director, the board learned that the district's enrollment fell by 45 students — to 4,252 students — when enrollment counts were taken last fall and compared with the previous year.
Since the district’s ability to spend is based on its enrollment count, any drop has an impact on what will be available to pay for programming and staff for the upcoming school year.
But Clinton’s district also has to deal with another issue, Isaac explained, the fact that the district actually does not get a 4 percent increase in allowable growth even if legislators come through with that funding. In fact Clinton will probably get 2.88 percent, which Isaac said is the result of declining enrollment.
Even though figures are not yet known, Isaac told the board he certainly expects a shortfall when dealing with next year’s budget and that options will include reducing operating expenses or using the district’s unspent balance.
Unspent balance is actually the carryover of a district’s unused spending authority. Spending authority is the limit that a school district can spend during any given fiscal year. It is not cash and is based on state funding formulas.
In this area, Clinton’s budget is very good. In fiscal year 2007, the district recorded more than $6 million as its unspent balance.
“We are in a wonderful position,” he said.
This balance is best used for a one-time event, such as updating curriculum and textbooks, which is very expensive. Isaac said the unspent balance should not be used as a funding mechanism for ongoing costs such as teacher salaries since it would be drained very quickly.
Where Clinton does have an issue however is with its cash on hand. Superintendent Richard Basden pointed out the district does not have a rainy day fund and that it could be borrowing for cash flow purposes.
Currently the amount on hand is $691,860, but Basden said half of that was drained by the budget cuts mandated by Culver.
Basden said this predicament actually began surfacing several years ago: While the board had about $4,150,000 on hand in fiscal year 1999, that amount started to decline when the board decided to lower the tax rate.
Board President Thea Engelson also said that the declining amount can be attributed to the board working hard to save staff and programming that were endangered. By fiscal year 2006 that amount was $473,316; the district has been working to bring it back up ever since.
Board member Steve Teney also pointed out that the thought was that by keeping taxes low, community members may have been inclined to support the district at the polls, but he said that didn’t pan out, as was obvious when the physical plant and equipment levy was voted down two years ago.
The district’s next step in the budget process is to get figures from building principals and the board said it wants input from staff members and the public as to what they believe is important and what could be cut if necessary.
That information then will be used as the board shapes its budget and keeps an eye on the legislature’s actions and while CEA negotiations take place.
The district also is working on a survey for parents who open enroll their children out of the district — about 200 students in all.
Basden said the district wants to know why the students are choosing other districts and what it would take to keep them here.
He also said that the new free 4-year-old preschool may help to develop relationships that would keep students here when their parents are enrolling them in kindergarten.
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