Sean C. Morgan
With the failure of Measure 30, School District 55 will be unable to restore any of the programs and staff cuts it made last school year.
The district made approximately $500,000 in cuts last year, Supt. Larry Horton said, as state revenue projections and payments to the district continued to decline.
If the district maintains this year’s programs and staffing levels, the district’s expenditures for 2004-05 will exceed revenues by roughly $1.5 million, Business Manager Kevin Strong said. “To help minimize the impact to students, we are actively seeking grants and other sources of outside revenue.
“We are taking a cost-neutral approach to labor negotiations, and we are looking for ways to get more work done with fewer resources.
“Most important, the more we can save this year, the less it will hurt next year.”
The School Board will need to decide to key questions for next year.
“The first question is how close does the district want to run next year’s ending fund balance to zero,” Strong said. The district will finish this year with an ending fund balance of $1.6 to $2 million.
“The second question is how much of the PERS (Public Employees Retirement System) savings should the district spend on next year’s operational expenses,” Strong said. “Ideally, it would be wise to set the PERS savings aside until we know the outcome of the PERS-related lawsuits. Realistically, we will have to spend most of the PERS savings to avoid significant program and staff reductions.”
The estimated ending fund balance includes approximately $400,000 in PERS savings, which resulted from reforms passed by the Oregon Legislature last year.
With the failure of Measure 30, the district is moving forward with the idea that none of the cuts will be restored, Strong said, but no one has told the district for sure what it can expect to receive.
The district budgeted this year as if Measure 30 would not pass while the state provided funding as if the tax were in place, leading to the buildup of the projected ending fund balance with the help of the PERS savings. The ending fund balance may be enough to offset the $1.5 million less available in resources next year depending on how close the School Board is willing to run next year’s ending fund balance to zero.
It may not be enough depending on what the final figure is, and the district does not know yet whether the state will begin reducing payments during this school year.
Strong is already focusing on the ending fund balance for June 30, 2005.
“What’s going to be difficult is we’re going to be starting with a very low beginning fund balance (in July 2005),” Strong said. “We’re kind of still waiting to see what the governor decides.”
“They may address it,” Supt. Horton said. “I don’t know. I can’t count on that. I have to go with what our citizens are telling us.”
The board has been conservative in spending PERS savings and the money that Measure 30 would have provided.
And the district’s cuts have not been as severe as other districts, Supt. Horton said.
“This is a credit to the board ? for thinking ahead into the future rather than being concerned about the current year, which has helped,” Strong said. That will help keep District 55 from needing to make the deep cuts other districts will need to make.
Other issues that will affect the ending fund balance this year include a contract settlement with teachers.
Coupled with the Measure 30 cuts, Supt. Horton is also concerned about declining enrollment, about 100 down from last year, which will come with an additional decrease of about $500,000.