With income dropping, numbers of students declining, budget deadlines approaching, and the easy expense cuts already made, the Fayette County Board of Education Monday night heard the first, but likely not the last, proposal intended to trim sufficient funds from the people side of the budget for next year.
Superintendent Jeff Bearden in past months has stated that a significant amount of needed reductions in expenses will come from personnel cuts.
First up was a proposal to reduce 72.5 school-based positions at a savings of $4 million.
Human Resources Director Reanee Ellis told board members that those numbers could change somewhat as staff worked through the reduction process.
The reduction of 72.5 positions is expected to generate approximately $4 million in savings for the 2012-2013 school year that begins July 1. Of that total, 61.5 positions would be certified teaching positions and 11 would be classified employees, Ellis said.
Bearden in previous meetings had stated that the school system needed to find approximately $10 million in savings in order to adopt a balanced budget in June. At his recommendation, school board members in December adopted a new 177-day school calendar that would save approximately $3.3 million next year.
It is noteworthy that, to some extent, the amount of money needed to balance the 2012-2013 budget is a moving target. Yet the bottom line is that the current budget has $170.23 million in revenues and $186.7 million in expenses. State law requires that tax levying entities adopt a balanced budget.
The current projection of a June 30 fund balance of about $13.9 million from various savings along with the current proposed staff reductions and going to a 177-day calendar will help significantly but may not solve the problem in the face of falling state and local revenues.
What also remains to be seen is whether the upcoming budget will have some amount of cushion in it to help buffer what could be a further decrease in the tax digest and additional decreases in enrollment that would result in even less state revenue.
A breakdown of the proposed reduction categories included 24.5 elementary school teachers, 23 middle school teachers, 14 high school teachers, 17.5 custodians and 1 clerical position.
A more detailed view showed that of the 24.5 positions in elementary schools, 19 of those would be regular education teachers, 3 would be special education teachers, 1.5 physical education teachers and 1 counseling position.
Middle school reductions included 19 regular education teachers and 4 special education teachers.
High school reductions included 13 regular education teachers and half a special education teacher.
The classified positions targeted for reduction included 10.5 elementary school custodians, 3.5 middle school custodians, 3.5 high school custodians, 4 elementary school parapros, and 1 high school clerical staff.
The proposed reduction in parapros would be accompanied by the addition of 9 specially-trained collaborative parapros that could function in a more integrated fashion and would eventually generate more state revenue, the board was told. So in terms of the total number of parapros there would be a net gain of 7.5 positions.
Ellis said the proposed reductions came after in-depth conversations by the allotment committee with the various school principals. Those conversations were give and take, Ellis said.
Additionally, Ellis said the school system is communicating with employees to get a handle on their plans for next year. She noted that the school system usually loses 250-275 employees each year through people retiring or moving. Communications with staff thus far has determined that 34 are expecting to retire with another 45 considering retirement.
Asked by board member Bob Todd if the reductions were based primarily on the school system’s decreasing student enrollment, both Ellis and Bearden said that was the case.
“It’s a direct reflection of the loss of student population,” Bearden said.
The school system lost more than 700 students this year compared to the previous year and has seen a decrease in enrollment that totals approximately 1,760 students since 2007. A study performed last year projected the loss of another 1,650 students between now and 2021.
The proposed reductions presented Monday night will be followed by additional considerations in March that are not centered only on instructional staff. Asked after the meeting about other cost-saving proposals, Bearden said he would be discussing the areas of transportation, school administration and county central office.
Unlike in most years, staff reductions have an enhanced significance since the school system is looking at ways to cut costs in the face of falling revenues from both local property taxes and state QBE (Quality Basic Education) dollars.
The school system receives approximately 53 percent of its income from local property tax revenues. Local revenues going to the school system are budgeted to total nearly $90 million this year.
But with the projection last week by the Fayette County Tax Assessor’s Office that the tax digest is anticipated to decrease by approximately 8 percent, that decline could mean a decrease of approximately $7.2 million for the coming school year.
Unless there is some form of unexpected infusion of revenue from the state, the school system will also see a decrease in that revenue category. The school system brings in approximately $4,000 per student being served. Though it takes an amount of time to experience the full impact, the loss of more than 700 students since last school year will eventually translate into nearly $3 million fewer dollars in state revenue.