Oxford Area Community Schools is anticipating yet another budget shortfall for the 2004-2005 school year ? as much as another $1,573,000 ? and the district will most likely have to access its fund equity for the first time since cutbacks began.
In a presentation at the May 11 regular board meeting, Superintendent Virginia Brennan-Kyro informed board members that a combination of revenue losses and expenditure increases is causing the deficit.
‘It’s really about our revenues decreasing and our expenditures, our costs of doing business, increasing,? she stated.
The district has estimated the Headlee rollback to be $100,000 more than the previous year, for a total of $650,000 in reduced revenues from what the school could be getting. Also, the district’s share of special education county tax receipts are estimated to be $200,000 less than the previous year.
Brennan-Kyro explained that when these losses are combined with the projected increases in expenditures – including a 20 percent increase in the cost of gas for heating the district’s buildings (roughly $100,000), a 17 percent increase in health insurance costs (a difference of $170,000 from the 12 percent budget this past year) and between a 12.99 and 14.87 percent increase in the district’s contribution to the State of Michigan retirement fund (almost $500,000) – the total deficit reaches above the $1.5 million mark.
The board was informed that district administrators will be focusing on four main areas in order to balance the budget: bringing in some revenue increases, utilizing the district severance program, reducing expenditures where possible and utilizing the district’s fund equity.
Brennan-Kyro said she is expecting to see revenue increases in three different areas. The first is a $278,320 increase, due to a projected increase of 50 students, in the district’s student foundation.
‘I am confident we’ll get 50 new students,? Brennan-Kyro told the board. ‘We feel fairly confident in that number. We actually feel that it is a very conservative number.?
The second revenue increase will raise the medical fees for those playing sports. The medical fees currently cover the cost of the district’s trainer, supplies and any other related expenses. This past year the cost was $50 for the first sport, $30 for the second and no charge for the third. The amount will be raised to a one time $110 fee for any number of sports, bringing in an additional $11,500.
‘This is becoming a very common practice throughout the FML,? said Brennan-Kyro. ‘The average fee in the league is ranging from $100 to $120. Three districts… have between $120 and $200 set for their’s.?
Finally, Brennan-Kyro said administrators anticipate a third revenue increase in ticket sale volume totalling around $4,500.
‘We’re not raising the ticket price,? she assured board members. ‘Because of the new facility, we believe we can increase the interest in our athletic events, thus bringing in some additional revenue.?
The total amount in new revenue equals approximately $294,320.
The district is in the second year of the buyout option for those teachers close to retirement. As of the March deadline, 10 instructors accepted the severance package, saving the district $500,000.
‘We negotiated the retirement program with the teachers and gave ourselves a two year window,? explained Brennan-Kyro. ‘These are positions I am going to be filling with new teachers, but even then, we are saving a large amount of money.
The third step in balancing the budget was to consider any possible cost reductions. Brennan-Kyro informed board members that staff was able to find an additional $322,680 in cuts; mainly through supplies, maintenance items and professional development.
‘The first thing we did was to look at items that did not impact our instructional program, that was as far away from the classroom as possible and that did not adversely effect any personnel,? said Brennan-Kyro.
‘Our entire district has really done a conscientious job of being fiscally responsible and really being careful to make sure that if there is an expenditure, it was no more than necessary,? she added.
The superintendent was proud to add that no staff layoffs were needed as a result of the deficit; however, several positions would be removed through attrition:
n suspension of Oxford Middle School’s Life Skills Elective
n reduction of the elementary counselor position
n reducing the Director of Communications position to .5
n removal of one paraprofessional at OMS in the boys locker room, a position now covered
n reduction of the literacy coach, position eliminated with the end of the grant
n elimination of the two elementary Spanish teachers, both employees will be moved into open positions within the district
n removal of one paraprofessional at Clear Lake Elementary who had been stationed there because of special needs, which will no longer be present for the 2004-2005 year.
The total savings in removing these positions would be $610,680.
Director of Communications Edie Paradowski’s position will still be a .7 part-time position, including benefits, despite the listed cutback. The additional .2 hours will be supplemented through a $17,000 Homeland Security Grant.
‘In the first year we can charge some of the grant for administration costs,? explained Brennan-Kyro. ‘Because we are required to have a coordinator with this grant, and Edie would be that coordinator, we are able to use the funds.?
Finally, district administrators are proposing to do something they have not yet had to do to balance the budget – dip into the school system’s fund equity. Brennan-Kyro is proposing to use $168,000 from the fund to cover the remaining shortfall.
‘We can utilize this amount so no more cuts are needed,? she informed board members. ‘In the four years I have been here, we have balanced the budget without using the fund equity. I would recommend doing so now.?
When asked about the start up costs for running the new high school and middle school, Brennan-Kyro said those amounts are not shown in this proposed budget, and the ‘one time costs? will be drawn from the fund equity at that time.
Oxford board members did not have to act on the budget proposal that evening. The district’s budget is required to be balanced and acted upon by July 1.
‘I’m impressed with what I’m seeing here,? said board member Doug Myer. ‘The thing that scares me is next year, especially with the severance program, our costs are going to go up.?
‘I’m already thinking about next year and I have some strategies,? assured Brennan-Kyro, ‘but I try not to spend a lot of time thinking about it. I try to go one year at a time.
‘It’s going to be a challenge and it’s going to continue being a challenge for years to come,? she concluded.