Although Fayette County Schools are expecting more cuts in state funding later this year, they will get a big shot in the arm this month and next
thanks to a significant amount of one-time federal funding for school employees.
Comptroller Laura Brock said the system will receive $4.25 million over the next two months to be used for salaries and benefits for school-level personnel.
The end result is that the Fayette County Board of Education will have $4.25 million of its budget freed up, but Brock cautioned that this year’s budget also has a deficit of $5 million. She added that the timing of the payments allows the system to get by without issuing a tax anticipation note, a short-term borrowing mechanism designed to help boost cash flow until property tax revenues start coming in.
This is the first time in at least 10 years that the system will not have to use tax anticipation notes to sustain funding on a short-term basis, Brock said.
While the federal funding adds flexibility to the school system’s budget, there are reasons to hang onto the cash, Brock noted.
The school system is facing more cuts in state funding from the quality basic education program, Brock noted. The word at the Department of Education is that the budget cuts presented to the legislature will be at the levels of 2 and 4 percent, Brock said.
Meanwhile Brock added that changes to the state’s health insurance plan will cost the school system $385,000 this fiscal year and an estimated $660,000 the following fiscal year.
This increase was not planned for in the county’s budgeting process, Brock added.
Board Chairwoman Terri Smith noted that officials with a state association representing local school boards have urged school systems not to consider the federal funding “as a windfall, but to save that money and hang onto it.”
“We are anticipating a funding cliff … there are other cuts coming to the budget,” Smith said.