Sean C. Morgan
The Sweet Home School District Budget Committee approved the proposed 2018-19 budget Thursday evening, May 17.
The budget moves on the School Board for a public hearing and adoption during its regular meeting on June 11.
The General Fund is $25.8 million, and the total of all funds, including Title I, Measure 98 funding, debt service, money transferred to reserve funds and other special funds, is $54.6 million.
As part of the approved budget, the district will reduce the local option levy, which pays for swimming pool operations, from 32 cents per $1,000 of assessed valuation to 30 cents per $1,000.
Kevin Strong told the committee that a rate of 28 cents per $1,000 most closely matches operational costs, approximately $203,000, the reason the district asked voters to approve the levy.
Each penny in taxes will raise between $6,500 and $7,500 in revenue, Strong said. Pool Supervisor Gretchen Dougherty identified several items needed this year beyond basic operating costs next year.
That includes new lane lines, a new commercial pool vacuum, a new lane line reel, replacement of aging kickboards and other supplies needed for lessons and exercise, AED replacement and replacement of lifeguard station chairs. The total cost is about $13,000.
The committee agreed to reduce the levy to 30 cents to allow the district to make these purchases.
Strong said that the pool’s filtration system will need to be replaced in the next five to 10 years at a cost of more than $100,000. The district has planned to use money from the Long-Term Maintenance Fund to cover the expense.
Among changes, the budget creates a new fund to pay Public Employees Retirement System expenses, transferring $100,000 from the General Fund to the new fund in fiscal 2018-19, which begins July 1.
In a presentation to the Budget Committee, Strong outlined Sweet Home’s history in dealing with the continually increasing cost of funding PERS.
During the 2002-03 fiscal year, the board issued $17.3 million in bonds and gave the proceeds to PERS to invest, Strong said. The key bet was that investment returns would exceed interest costs for the bonds.
The board also set aside funds to help pay off the PERS Bonds, Strong said. He compared Sweet Home’s position to Lebanon Community Schools.
Sweet Home has an unfunded liability of $11.3 million, $5,000 per student, while Lebanon has a liability of $59.8 million, $14,000 per student.
Lebanon has reserved $1.5 million to help offset future PERS rate increases, Strong said. Meanwhile, Sweet Home has $19.4 million in outstanding debt on its PERS bonds, with $3.65 million reserved to pay back the debt.
The upshot is Sweet Home has a total obligation of $27 million, $12,000 per student, while Lebanon has an obligation of $58.56 million, $14,000 per student.
Sweet Home has a PERS rate of 24.5 percent of payroll, while Lebanon has a rate of 28 percent.
For every $10 million in labor costs, Lebanon must spend $350,000 more on PERS than Sweet Home has to spend, Strong said.
Present and voting to approve the budget were Chanz Keeney, Ben Emmert, Angela Clegg, Debra Brown, Jason Van Eck, Jason Redick, Jim Gourley, Mike Reynolds and Don Hopkins. Absent were Carol Babcock and Brittany Donnell.