COLUMN: School district examining funding, spending

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By Sheila Mitchell

A top priority for Anderson County Schools is to ensure that we are meeting the academic and developmental needs of all students.
To meet this goal, the district has delivered the funding necessary to secure the valuable programs we provide. In order to continue this tradition, the district must be proactive in the assessment of our financial needs.
This task has become more challenging due to the uncertainty of the economy and the decisions state legislators have made in reduced funding of school programs.
Given these cuts, the school district’s general fund has been carrying the burden of paying these additional expenses and the reserve levels for that fund have been decreasing.
The school district is closely examining this issue and is taking action by making budgetary adjustments that will not impact student services. A district budget committee has been formed to review the spending patterns of the past five years. This committee is charged with reviewing the spending and making recommendations on areas that could potentially be reduced.
The first committee meeting took place in September with an established goal of gaining a full understanding of a school district budget.
This is a challenging task as there are several components to a school district’s budget with money being contributed from multiple sources. These sources include:
General fund: The purpose of the general fund is to cover the bulk of the operational costs of the district. It is funded primarily by property taxes and state SEEK funding. As previously stated, the general fund has been used to pay the increased costs on the district due to state funding cuts.
Special revenue fund: This fund includes multi-year funds consisting of various funding sources including federal, state and local categorical grants. However, the stipulations with these funds are that they are restricted by the issuing agencies. Thus, before the district can access these funds, it must agree to follow the guidelines put into place by the funding agency.
Capital outlay fund: These funds have been recently allowed to be used to cover some operating type expenses with approval from the Kentucky Department of Education. This fund is restricted mainly for repayment of bond issues and debt services.
Building fund: Similar to the capital outlay fund in that these funds are also restricted for repayment of bond issues and debt service.
Construction fund: This fund is restricted for the proceeds of bond sales used for school renovations and new construction.
Food service fund: This is the last major fund of the school budget. Money in this fund represents the nutrition services component of the district and is used for all the expenses related to the cafeterias.
After gaining an understanding of the multiple funds used in constructing the district budget, the district’s budget committee will take a closer look at the budget with a granular look at the spending of the last year. While this is a challenging job, the committee hopes to be creative with its recommendations for future budgetary decisions in addressing the necessary funding cuts and increased costs occurred and mandated by the state department.
There are several cuts that the committee will be reviewing, including a half-million dollar cut to Flex Focus grant (ESS, PD, textbooks, and Safe Schools) over the last two years, with the bulk of the cut coming this past year. This cut appears to be reoccurring as the state education commissioner indicated that the funds would be cut again this year with no additional funding for the remainder of the year.
A few of the additional costs that the school district has had to absorb include:
State mandated raises: While these raises are well deserved, the state mandated them without providing additional funding for them. Thus this was done at increased cost to the district.
Preschool: This program has taken some big cuts to its funding due to stricter qualification guidelines. The general fund has covered the excess expenditures that the state and federal funding for preschool does not cover equating a district loss equaling several thousands of dollars.
Full day kindergarten: For several years, we have provided a full day kindergarten program for our students. The funds we received from the state department only fund half of the total cost. We value the full day program and believe it has an impact on getting a great start for our students in their educational experience.
Despite these significant cuts, there are new funding opportunities for the district. The federal government has provided grants in the form of the American Recovery and Reinvestment Act (ARRA) and Education Jobs Fund (EDU JOBS).
These funds are program based and cannot be used to pay for operating expenses. The ARRA funds will be expiring in 2011, so budgeting decisions will have to be in place on how to continue the services paid for with this grant. EDU JOBS is new this year, and will expire in 2012.
While we will use these funding resources to alleviate the budget shortfalls, the limited nature of the offering does provide challenges in planning a long-range budget. The budget committee will also be taking a closer look at these funds and making recommendations.
As a school district, we are concerned and sympathetic to these harsh economical times. While state and federal funding is decreasing, along with the Kentucky Department of Education, we are constantly raising the expectations of our teachers and students and will continue to do so. We are mission driven and will continue our vision:
“To ensure all students are Safe, Reach High Academic Standards, and Act as Responsible Citizens.”
It is imperative that we provide the programs and services needed to meet the needs of all students regardless of cost, therefore we are willing to plan creatively to ensure that our goal is not compromised. Our mission states that we will have funding that supports the mission and vision of overall excellence.

—includes information from Anderson County Schools’ Finance Officer Nick Clark and Chief Information Officer Bret Foster.

Sheila Mitchell is superintendent of Anderson County Schools.