The Red Clay Consolidated School District has a preliminary budget in place for the 2009 fiscal year that increases spending by 3.9 percent to $160.6 million, while revenues are expected to be up 7.9 percent to $167 million.
Revenues are up thanks to the district’s successful referendum held in February, which asked for an increase in local taxes, said Chief Financial Officer Jill Floore at the Red Clay Board of Education meeting held August 20 at Warner Elementary School.
Local funds for the 2009 preliminary budget will increase 17.1 percent to $61.9 million and state revenue – coming off the heels of several belt tightening moves by the state – will increase 3.1 percent to $105.1 million, she said. State funding for salaries would go up 6.5 percent to $79.4 million and local salaries and benefits would go up 5.9 percent to $44.3 million.
“It’s a strong budget,” Floore said. “A budget is always going to have assumptions. We are still waiting on enrollments, which is critical.”
Red Clay’s carryover balance – the amount of money leftover from the 2009 fiscal year – would be $6.47 million, Floore said. This money is critical in assuring the state Red Clay has enough in the bank to meet payroll through October, when local tax receipts arrive and state funding based on enrollment begins to arrive.
That would follow Red Clay closing out the 2008 fiscal year on June 30 with a better-than-anticipated $4.7 million carryover in local and state money, Floore said. That was up from her original projection of a razor thin $260,483. The district’s tax receipts were greater than anticipated because delinquency among taxpayers was not has high as anticipated. Moreover, greater revenue led to greater interest earned, she said.
That is good news for a district that will have to borrow money from the state for the third consecutive year this fall. The state loaned $7.4 million to Red Clay in the fall of 2007, a float that was repaid once revenue poured in. The state had loaned money to Red Clay in the fall of 2006 as well, contingent upon development of a plan to ensure that the district would not require the same assistance for FY 2008. When it became clear Red Clay would need another bailout from the state for 2008, Secretary of Education Valerie A. Woodruff requested the assignment of a state Financial Recovery Team to Red Clay in May, 2007.
The state team found that the district got into trouble because of hiring staff above what the state would pay for, among other things, causing a drain on finite local dollars. The state team is overseeing expenditures and hiring decisions indefinitely to ensure the district can be fiscally solvent.
While Floore anticipates Red Clay will need another float from the state this fall, it will be much lower than previous loans.
The Red Clay board is expected to approve the preliminary budget for 2009 at its September 17 meeting.
Floore gave a detailed list of referendum initiatives. Among other things, there is a $2.5 million increase in local salaries and benefits associated with the cost of state-mandated, full-day kindergarten and the restoration in deep cuts made in extra pay for teachers who work in extracurricular activities. Those cuts had led to the elimination of middle school sports and clubs, among other things.
