Board discusses budget

By Greg Bird
birdman@tmcvoice.com

The McCreary County Board of Education met in special session Monday night to get a better knowledge of the 2019-20 school year budget. Presented by Finance Director Michelle King and Management Consultant Bill Boyd, the Board learned the District is in good shape financially, with more than $3 million in contingency funds, but to expect some decreases in revenue.
The School District typically works on three versions of the budget before final passage after tax rates are set. The first, the draft budget, is presented in January and provides the Board with a basic framework of what could be expected for the next school year. A tentative budget is presented in May, giving additional information but still lacking concrete numbers.
The working, or actual budget, is what is passed after tax rates are set, and the District is more fully aware of what its revenues and expenses are expected to be.
Impacts on the revenue side show the District will see a decrease in SEEK funding from the state of about $500,000 due to a decrease in average daily attendance last year and the increase in overall property assessments in the County by about $14 million.
Last month the Board opted to take the compensating tax rate, actually lowering their tax rate due to the increased assessment. The tax rate on real property was lowered by 0.5 cents per $100 of value from 40.9 to 40.4. While the tax rate is good news for the citizens of McCreary County, it does potentially present a future conundrum to the Board. If the assessments continue to rise, as might be expected due to the addition of the new factory in Stearns, state SEEK funding could continue to decrease for the District. If that happens the Board could be faced with making cuts or raising taxes to compensate for the loss of funding in the future. Only twice in the last 17 years did the Board not take the compensating rate – opting to maintain revenue through the real property tax. In 2011 and 2015 the Board increased rates by 4 –percent. In 2016 the Board did adopt a significant increase to the motor vehicle tax rate, increasing from 30 to 46.7 cents per $100 of value.
Additional impacts to the budget included the addition of several positions at the schools to meet staffing requirements.
King noted the District was able to cut expenses for the coming year by strategically changing how some staff were coded in payroll to lower the cost to the general fund. King explained that some staff codings were changed to be paid through different Title funding, a move that saves the general fund expenditures. The District does have to reimburse the state for the insurance on such staff, so careful consideration was made on what personnel were coded to minimize the impact.
The District also saw a decrease in accounts payable costs, such as electricity, insurance, transportation repair parts and copier expenses, due to changes made over the past few years.
The Board will meet again next Tuesday to get a more detailed look at the budget and will have more information on some questions they had asked about specific portions of the budget.
The official budget has to be approved by the Board before the end of the month and is expected to be on the agenda for passage at the next regular-scheduled meeting on September 23rd.