FLINT TWP. — Assuming that all employee unions agree to a 10 percent salary cut and enrollment declines by no more than 100 students, Carman- Ainsworth’s budget picture for next school year is poised to meet its looming financial challenges.
The school board held a public hearing last week to present the $43,889,348 proposed budget for 2013- 14, which is down from an estimated $49,242,441 this school year and $48,605,460 in 2010-11.
Expenditures next year will once again exceed revenues by about $347,886 and the difference must be met from an estimated $1 million fund balance, said Russ Parks, assistant superintendent in his budget presentation. It follows a trend of the past few years which has gradually depleted a general fund balance that stood at more than $5 million as recently as the 2010-11 school year.
But declining property taxes, enrollment and state-aid all have taken a toll.
Parks noted that local and state funds account for about 80 percent of the district’s annual revenue.
One budget assumption is that property taxes will decline only 4 percent this fiscal year, bringing in an estimated $5.5 million in revenue. Parks called it an encouraging step in the right direction after several years of double-digit property tax drops.
State-aid, on the other hand, which accounts for about 64 percent of the general fund revenue, is not as rosy as some might think. Although Gov. Rick Snyder is expected to increase funding for K-12 education this year, it will barely make a dent in Carman- Ainsworth budget.
Parks explained that a proposed $46 per student foundation allowance increase will be offset by a $174,496 decrease in Michigan Public School Employees Retirement System (MPSERS) categorical revenue.
That amounts to a $47 per student drop in revenue, said Superintendent Steve Tunnicliff. The $46 increase applies to all school districts in Michigan but the state-aid formula giving an additional $50 to some base school districts does not apply to C-A.
“Those of us who are above the base foundation level aren’t getting a dime per kid,'” Tunnicliff said. “Our projected net from what we expect the governor to sign is about $5 more per kid.”
Parks noted the budget assumption that C-A will lose no more than 100 students and funding estimates about based on a blended student count of 4,256 students. C-A has seen its enrollment steadily decline from a peak of about 5,500 students ten years ago., he said.
Yet another budget assumption is that all C-A bargaining units will agree to 10 percent pay decrease, as the teacher’s union already has
“If that does not happen then the board is going to have to decide what other avenues we have at our disposal to make up that difference,” he said.
Salaries and benefits account for about 85 percent of general fund expenses.
Parks noted that C-A proposes to spend about half of its budget – $21,030,424 – on instruction. In fact, the district has consistently ranked in the top third statewide in terms of how much of its money goes directly into the classroom, he said.
The proposed budget also covered the food service fund, community services funding, debt retirement, the building and site fund and capital projects.
Parks drew laughter when he said that students are expected to eat more next year. He explained that 250 seniors who just graduated have not been fans of a new menu implemented a few years ago but incoming freshman, about 400 students, are used to the food and more likely to eat it. Middle school students currently eat cafeteria food at a higher rate than high school students, he said.
In summary, Parks said the budget for next school year is “not a pretty sight but getting better.”
He said he did not anticipate many changes to the proposed budge that will come back before the board for adoption by June 30.