833 task force group seeking $7.5 million in cuts
The task force charged with suggesting $7.5 million worth of cuts from the 2009-2010 School District 833 budget started work Feb. 2.
The school board already increased class sizes by an average of one-half student and is looking to cut the budget by $5 million.
The district has a $23 million fund balance of unallocated money that would be used up in two years if there were no changes in the overall revenue forecast, according to a projection by Aaron Bushberger who is the district's finance director.
Superintendent Tom Nelson said a number of options are available including cuts from the approximate $140 million general fund.
Getting more tax money isn't an option, because the deadline for putting a referendum on the November 2009 ballot is past, he said.
For the first time since the early 1980s, no additional enrollment is forecasted for two years, which adds to budget concerns.
The district will also have to spend an additional $3.7 million annually to operate East Ridge High School.
Interest rates on revenue, investments and construction funds have decreased sharply from 5.3 percent in July of 2007 to 1.5 percent at the end of 2008.
There is also a 5 percent annual increase, or $600,000, projected for utilities and tuition for students who attend Intermediate District 916.
The school board also voted to delay changing from a four-period day to a six-period day in high schools until 2009-2010 adding a $1.1 million cost for one year only.
On the revenue side, the district will get an extra $1.25 million in state money and an additional $600,000 set aside for special education.
The district must also forecast changes in labor contracts for employees. The teachers' contract ends in July of this year and is typically settled in the fall, Nelson said.
A one percent increase for all employees costs $1.25 million, according to Bushberger. For planning purposes, the district is projecting 3 percent that would have a $3.75 million impact.
If the governor's budget were to pass the Legislature, the district could get up to $1 million in additional money because of incentives based on test scores. Nelson said the estimate is based on performance in past state tests.
One of the options to mitigate cuts from the general fund would be to take advantage of a change in how districts put money aside to pay for teacher retirement benefits set in past contracts, Nelson said.
The district's Internal Service Fund is fully funded at $31.4 million. The district makes an annual $2.5 million contribution.
The legislature now allows districts, without voter approval, to sell bonds to cover district contributions. The school board could sell bonds for part of the fund and transfer the money to the general fund, according to Nelson.
Task Force Schedule
The budget cut task force will meet on Mondays through this month and in the first week in March.
The task force will present a list of options at a school board workshop on March 5.
School board action on cuts is expected on March 26.