Schools’ Budget Leaves Emergency Reserves Dangerously Low
Thursday, June 28, 2018
by Leslie Lytle, Messenger Staff Writer
In a split decision, the Franklin County School Board voted 6 to 2 to approve a revised budget that reduces the school system’s emergency reserve fund balance to a dangerously low $2.3 million. The vote was taken at the June 25 special called meeting, which occurred in response to the County Finance Committee’s refusal to award the school system $829,388 in new revenue. The decision to take the new revenue needed from the fund balance will enable the schools system to pay $161,000 in increased health insurance costs, keep the Pre-K program operating at its current level, award contract bus drivers a 1.5 percent raise, and award teachers and non-certified employees a 2 percent cost of living raise.
County Deputy Finance Director Cindy Latham repeatedly advised the board not to draw the fund balance below $2.5 million, the amount needed to make payroll. “State basic eduction program funding comes monthly,” Latham said, “but not always in time to make payroll.”
“The fund balance has never been lower than what it takes to make payroll,” cautioned board member Chris Guess, who voted against the budget.
“Reducing the fund balance to $2.3 million is not financially responsible,” said board member Lance Williams. “In five years we’ll be dead broke if we continue to cover the raises every year.” Williams also voted against the budget.
The board considered reducing the request for new revenue to $161,000, the amount of the health insurance cost increase.
“I don’t think we’re going to get any new money,” said Williams. According to Williams, other county departments have been advised not to expect new money and to take the money for 2 percent cost of living raises from their fund balances.
“Other departments have a higher fund balance percentage than us,” noted Director of Schools Stanley Bean.
Board member Adam Tucker suggested reducing the amount designated for capital outlays to offset the fund balance draw.
That would leave “no money for improving the schools,” Bean said.
“And no money for addressing breakdowns,” Guess added.
Bean proposed reducing the raises to 1 percent and giving a bonus at Christmas to bring the raises up to the original amounts proposed, if the money was available. “I’d feel comfortable with that,” he said pointing out the fund balance would only drop to $2.6 million with that plan.
“Going broke is still going broke,” objected Williams.
“Yes, but in eight years instead of five,” said board member Sara Liechty.
Williams recommended waiting until the end of the year and giving raises then if the money was available.
“Not giving raises is a bad message to the teachers,” Bean said. “We need to give them something up front to show the school board is making an effort.”
“We can’t ignore our teachers,” agreed Board Chair CleiJo Walker.
Surrounding counties were giving a 2 percent raise, Liechty observed. “What’s the risk of going with the original 2 percent plan and having faith the county commission will support pay raises in the future?” she asked.
“I think the commission will help us with emergencies, but not pay raises,” Bean said.
“The county has always come through when we needed something,” said board member Christine Hopkins. “I think we need to put the 2 percent raise in and take our chances.”
Hopkins made a motion to draw the entire $829,388 needed in new revenue from the fund balance. Liechty seconded the motion. A roll call vote followed.