Forecast for Fayette schools: $15 million more in cuts

One of the dozens of schoolbuses operated by the Fayette County School System. Photo/Maggie Zerkus.

The Fayette County School System has been saving money by not filling some vacated positions and watching expenses since the school year began in August. But, as expected, the final report from the cost-cutting committee at the Monday night meeting of the Fayette County Board of Education showed the need in the coming months to plan for approximately $15 million in cuts so the school board in June can adopt a balanced budget for the 2013-2014 school year.

Deputy Superintendent and cost-cutting committee chair Sam Sweat in summarizing the committee’s months-long work said the school system must see a total savings of $14-15 million for the new school year. To accomplish this, personnel in central office and in schools must be reduced and the school system must be more efficient with facilities by closing an as yet undetermined number of schools, he said.

Approximately 91 percent of the operating budget is personnel. Sweat stressed that the personnel cuts must be strategic so the quality of the school system is not adversely affected. The budget process needs to proceed quickly, Sweat said, so affected staff know where they stand in terms of employment.

One of the items outgoing Superintendent Jeff Bearden referenced last summer for possible cuts included the positions not funded by state QBE (Quality Basic Education) dollars, positions that are funded entirely by local taxpayers.

It was noted Monday that only two-thirds of QBE-funded positions are actually funded by state dollars. In total, there are 350 positions funded exclusively by Fayette County taxpayers. Sweat said those positions, accounting for salary and benefits, total $16.67 million and include:

- 117 parapros at $2.925 million

- 14.5 counselors at $1.09 million

- 14.5 assistant principals at $1.3 million

- 49 secretaries at $1.23 million

- 150 teachers at $9.75 million

- middle school athletics at $250,000

- 5 parking lot attendants at $125,000 (parking fees help defray this cost)

Sweat in his comments stressed that there is “no way we can take away that many teachers,” adding that the school system has been reducing teaching positions since 2009.

Sweat said other potential cost-cutting initiatives such as reducing central office positions at $1 million, closing at least two schools at $1.6 million, outsourcing the 152 custodians at $900,000, reducing supplements and extended day contracts at $400,000, increasing mileage on school bus pick-up points (1 mile or more compared to the current half-mile pick-up points) and combining middle and high school routes and conserving fuel at $400,000 and saving $700,000 for every calendar day schools are closed.

Pertaining to bus drivers, it was noted that Fayette has approximately 200 bus drivers, but the state pays for only 92.

In terms of yet other cost-cutting initiatives the board might want to consider, Sweat said a 1 percent decrease in salary would result in a savings of $1.325 million. And Sweat said the school system would continue to monitor positions that are not currently filled or have a long-term substitute and will continue to monitor purchase orders and expenses.

The school system’s fund balance projection for June 30 currently sits at approximately $6 million, with just over $3 million of that amount showing up as savings so far this year in personnel.

“We’re watching positions and saving money (through filling only the required vacancies),” Sweat told board members. “I think the fund balance will continue to grow.”

But whether board members count on a given amount of fund balance to offset cuts remains to be seen. The reason: there are the unknown variables of next year’s tax digest and state funding that could decrease yet again, providing even fewer dollars for operations.

Significant in terms of both operating revenue collected from the state and the number of employees required for the classroom is the school system’s student enrollment.

Fayette schools saw a high of 22,367 students during the 2006-2007 school year. Mirroring the wide-ranging effects of the recession has been the decline in student enrollment. That enrollment, as of early November, sat at 20,463.

And for the 2013-2014 school year that number is projected to fall again by another 530 students for an enrollment of 19,933.

That projected decrease, said Sweat, is expected to include a loss of 300 students at the elementary level and 200 students at the middle school level.

One of the results of falling enrollment is seen in diminishing state QBE dollars coming into the school. The state provides approximately $4,000 per student that goes to the general fund budget. So a decrease of 250 students translates into a reduction of approximately $1 million fewer dollars coming in to the school system.

The combination of decreasing enrollment and a decreasing tax digest due to falling property values since the year after recession began have taken a toll on school system operating revenues.

Sweat said the $197.1 million in combined revenue in 2007-2008 dropped to $185.5 million in 2008-2009, to $173.7 million in 2009-2010, to $170.23 million in 2011-2012 and to $163.14 million for the current school year.

The committee is projecting revenue to fall to $162 million for the 2013-2014 school year, though that figure is still contingent on the tax digest and state allocation figures that will not be out until next year.

Yet another expense factor board members will have to account for 2013-2014 deals with a $1,900 increase per employee for classified (non-teaching) positions.

Bearden a few months ago said the school system had a revenue problem, not an expenditure problem. His statement was interesting, since the current balanced budget with $163 million in revenues has expenditures of $177 million. That feat, on a 3-2 vote in June, was accomplished by using $14 million of the projected $15 million fund balance expected by June 30.

Among the committee’s far-reaching goals, and elaborated last summer by Bearden, included reviewing reductions at central office and staffing allotments at schools, analyzing energy management and outsourcing positions, maximizing revenues, reviewing the savings from school closures, reviewing the proposed tuition policy for out-of-county students, reviewing the requirement of having out-of-county employees pay tuition for their children, favoring long-term gains over short-term reductions, supporting 21st century technology and protecting student learning and achievement.

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