The budget discussion

I thought it might be useful for my readers to have the unabridged version – you can’t print everything -  of my comments to the CDT in regards to its recent story on the school district’s 09/10 budget.

My concern is that we're putting a lot of unnecessary effort and administrative time into preparing for a worst-case scenario that is highly unlikely. Every state budget is a negotiation, and as I said at the last board meeting, my guess is that the eventual state appropriation is likely to be closer to the governor's proposal (which would result in a net gain to the district of about $200,000) than to what the senate passed and which the house rejected (which would have resulted in a net loss of $600,000).

The most likely outcome, therefore, is that we’ll have to cover a shortfall of $100,000-200,000. (Keep in mind that the Governor has a pretty good track record of getting what he wants.)

In the proposed budget, we have already set aside $3 million from our fund balance in preparation for the spike in the mandated contribution to PSERS that will be occurring in 2012-2013. That still leaves us with over $500,000 above and beyond the 5% that has been established by board policy - more than enough to cover any shortfall from the state. In fact, these unexpected situations are precisely the reason that you have a fund balance.

While there are savings to be found in any budget, significant cost-cutting should be approached thoughtfully, deliberately, and with consideration for all the implications. This is especially true if we are dealing with a long-term issue, which appears likely. In my opinion, this is not something we should be trying to do in the twenty days we have left to pass this year’s budget.

The long-term solution: a change in the fiscal calendar that would let school districts know the state appropriation well before they have to pass their budget. This also seems highly unlikely, but Senator Corman has indicated that he’s willing to consider it.