We Have More Money?
We didn’t just “end up” with $15 million
You might have heard that the BOE somehow “ended up” with $15 million dollars more than we expected. While it’s certainly true that our last fiscal year ended with a fund balance that was roughly $15 million more than our original conservative budget, we didn’t just end up that way.
You can look at a presentation given on our October 7 Work Session for a detailed breakdown of the surplus.
Some of the reasons were intentional. One of the main reasons we have more money than originally projected is that we intentionally did not fill jobs that became open. So we spent less on payroll. We also specifically spent even less than we budgeted for operations.
Some of the difference is because we had more revenue than we predicted. The state actually sent us more money than was expected last year. We had more local revenue than we expected as well, primarily due to car taxes. Is extra car tax revenue because of the change from property tax to sales tax or is it because the economy is getting better and more people are buying cars? Will the state austerity cuts continue or will the political pressure from parents tired of school cuts make the state send more of the QBE funding we are owed?
Some of the differences were because we intentionally budgeted conservatively. We had a lot of savings in health care after all of the changes (changing to being charged per employee, being charged more per employee, and paying less towards employee premiums) were factored in.
Some of the difference was luck. We had a pretty mild year last year which allowed heating and cooling savings. Hard to predict that.
So we now have a fund balance of roughly 10% of our budget, which is the recommended amount to protect the school system. We must be prepared to face a crises without fear of running out of funds. It’s against the law for us to be in deficit.
We’ve been through tough times as we struggled to get our budgeted expenses to no longer exceed revenues. Georgia’s school funding method has not been kind to Fayette County. We have now reached a point where we will no longer be facing a fiscal “crisis” every budget year. I hope its safe to say we’ve reached the bottom and our revenues will no longer continue to decline.
But that fund reserve balance is money that we’ve collected from taxpayers to fund education in Fayette County. And there are so many things that we want to be able to fund that we’ve cut back on.
We must decide on how much of the fund balance to spend. Should we be conservative and try to maintain the recommended 10% fund balance in case revenues drop again? Or can we be more risky and spend some of that in anticipation of future revenue? It’s not sustainable to spend fund balance on recurring expenses without anticipating regular revenue eventually covering that expense.
If we want to spend it, we must determine priorities. Is it better to add back some parapro positions or contribute more to health care premiums? Is adding counselors more important that adding back calendar days? Do we need EIP teachers or more money for science labs?
We must support our teachers and staff. The single most important factor in a child’s academic success is her teacher. As a society we don’t give our teachers (or anyone who works with our children) the respect and admiration they deserve. We need to use our resources wisely for their benefit.
These are the discussions the board will continue having as we work to make the best choices for the students of Fayette County.
Stay informed and involved.
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