Focusing On Budget Cuts

Published 3:40 pm Tuesday, March 6, 2012

BUCKINGHAM – On Wednesday night, the school board hosted a public hearing for input into its FY 13 budget.

Unlike last year when the auditorium was packed, this year's turnout yielded approximately 20 people. Moreover, unlike last year when people filed to the podium one after another, this year only one person commented.

Prior to the public comments, Superintendent Gary Blair addressed the audience and explained that the budget is being developed with input from a variety of stakeholders.

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“Our school division does not teach in a vacuum. We reflect the needs of our children and we continue to be responsive to the needs expressed by our citizenry,” stated Blair, adding that the division was experiencing continued budget reductions due to decreases in state and federal revenues. He continued, “Although our enrollment is relatively stable, the division is experiencing higher accountability standards, rising expectations and a renewed faith in the value of public education.”

Dr. Blair offered that the renovation project on Route 20 serves as a reminder of the county's belief in the school division and the collective desire to provide the very best educational environment for its children.

Noting that the school division is beginning the process to develop and implement a new strategic plan for the division, Blair said the greatest challenge is to determine what to preserve in the school division and what must diminish as they “forge ahead with reduced funding.”

He stressed that as the budget is developed and finalized two questions must continue to be asked-what is in the best interest of the children and what must be done to maintain the quality and integrity of instruction for them.

“However, we simply cannot continue to cut costs and grow. We will work together to determine how to best meet the needs of our children and to achieve a consistent high standard of success,” shared Blair.

Explaining that this budget is different from previous budgets, Blair said that with the assistance of Paul Imig, a financial consultant working with the school division, they have revised the entire budget process and the financial reporting system. “My target is to provide detailed and clear information related to the cost of educating our children in Buckingham County,” he stated.

Blair said that while working on the budget he has investigated many areas for cost savings and reductions.

According to the superintendent, some of those areas include the need to adjust spending levels downward to reflect the realities of difficult economic times; finding ways to limit spending increases in utility and retirement costs; and investigating ways to minimize the financial impact of the increase in the cost of health insurance.

“We must identify potential revenue increases such as an educational foundation to support public education in Buckingham,” shared the superintendent.

He added that they are looking at potential ways to decrease non-personnel costs including an energy management system, performance contracting, and significant conservation measures at each school.

“We are investigating ways to reduce non-Standards of Quality expenses,” said Blair. However, he added. “We must avoid allowing the minimum to become the maximum.”

Additionally, he said they were investigating ways to reduce central services, central office administration and support staff, and school administrative staff.

The superintendent said they are also considering other avenues such as the possibility of a 160-day school calendar. “That is something to look at. There are some positives and negatives associated with that,” he stated.

One of the negatives would be 20 less workdays for bus drivers, instructional assistants, and other support staff, explained Blair. He added that teacher contracts would continue to reflect 200 days and teachers would be involved in a more rigorous and expansive professional development program.

Blair said they have also looked at the cost of athletics to see if some reductions can be made there.

Moreover, he said they were looking at the number of facilities. “The expenditures are a little bit higher than we would like them to be at a number of facilities,” said Blair. “It does not mean it is an action item but it does mean that we've looked at all eight of these.”

Stressing the need to maintain a perfect classroom ratio and a good class size, Blair said one thing the board would have to decide is its commitment to pupil-teacher ratios.

Blair continued, “Minimum staffing requirements do not provide adequately for the success of a school division.” He offered, “The most difficult decisions are often founded in a reduction in force for our school division. These decisions are met with much apprehension and with much sorrow.”

Sharing that he is thankful for the advice, support and direction offered by faculty, staff and administrators, Blair stated, “We do not want to lose any of our Buckingham family of employees; however, we must analyze staffing patterns and make a relevant decision that is not only instructionally sound but reflective of our commitment to stewardship.”

Calling on policymakers to preserve public education with fiscal support, Blair explained that Buckingham's local government is not immune from the troubled economy and downturn of funding beyond the locality.

“As we work together, I pray that we continue to have an accurate appreciation for each other's responsibilities and roles in maintaining our county and our division,” offered Blair. “We must continue to work in a cooperative manner so that we may design budget strategies that meet the needs not only of our students but our overall community as well.”

He added, “Our challenges are many but we know our opportunities have no limit.” Blair told the audience, “I will continue to focus on student growth and success as well as to remain sensitive to our school community and our entire county.”

Chairman Allen followed with a few comments. “The overall cut is about two and a-half million out of an approximately $25 million budget. That's ten percent.”

He added that about 80 percent of the current budget is for personnel-salaries, benefits and retirement; and, only 20 percent is non-personnel. Allen offered that when having to cut ten percent of the whole budget and only 20 percent of the budget is non-personnel, there has to be consideration regarding cuts in personnel.

Continuing, Allen explained that although the state and federal governments require more and more accountability, they continue to add more of the financial burden to pay for those mandates to the localities.

“Local people are not to blame for our financial situation,” stated Allen, noting the trickle down effect is forcing local governments to pay for everything.

When the floor was open to public comments, a Buckingham resident who is also a teacher at the Middle School was the lone speaker.

She expressed concern that in light of the budget situation, Gold Hill may remain open. The speaker said she thought the intention was that the schools on Route 20 would serve all primary and elementary students.

“We spent this money for an elementary school, I think everybody should be in one place,” she stated, noting that she felt that was what the county agreed to do.

The teacher also expressed concern about the possibility of putting more students in a classroom. She shared, “It hurts everyone.”

Continuing from a teacher's perspective and noting the increased responsibilities without increased pay, she stated, “We are being asked to do more and more; and, yet we are getting less and less.”

After Chairman Allen closed the public comment period, he advised that the board needed to meet in closed session for personnel and student discipline.

Upon the board's return to open session, Allen announced that although the budget schedule called for a work session on Monday, March 5, the board decided to postpone the meeting until Wednesday, March 7, at 6 p.m., in the CTE Center's Window Room.

Before recessing the meeting, Allen explained that over the last couple of weeks several people have mentioned that the school division should consider the use of the soon to be vacated building that currently houses Dillwyn Primary as a way to generate funds.

In turn, Allen appointed Vice Chairman Ed Wise along with Pete Gowin and Sherry Ragland to a committee to explore possible uses of the building as well as investigate either the sale or lease of the property.

Pre-Budget Work Sessions

The hearing followed two pre-budget work sessions. During the first of those, Superintendent Blair described the budget process as a long journey. He explained that the school division had drastically changed the process they have used to develop a budget.

“I'm starting with the extreme,” shared Dr. Blair at that February 15 work session. He explained that he asked the principals to tell him what they need. Similarly, he said he asked the directors to tell him what they need for the school division to continue to grow and prosper.

“So this is, hopefully, the biggest divide we will have between the revenues and expenditures,” shared Blair, adding that then work would begin to balance the budget.

His PowerPoint presentation that night demonstrated the extensiveness of that divide with a difference between revenues and expenditures of $2,586,797.

“That is significant and that is going to be tough,” said Blair. “Buckingham is up for the challenge. We'll work together.”

Blair noted that the governor's proposed budget included proposed revenue increases for sales tax, textbooks, retirement subsidies, at-risk, and K-3 primary class reduction.

On the flip side, he showed proposed decreases in basic aid, Social Security, Composite Index Hold Harmless, and the Virginia Pre-School Initiative.

Blair described the decrease in federal funds as the most significant in the budget. He explained that funding was down primarily because of the expiration of the federal stimulus funds.

While focusing on local revenues, Blair said that the 2012-13 working budget reflects a $2.1 million decrease. However, he explained that in the current budget year, the county gave the school division an additional $800,000 but told them to get their house in order.

Additionally, Blair said the local decrease reflects a change in reporting that removes debt service, which was listed as $1,248,031 in the working budget, from the school division's books to the county. “They are going to handle the debt service because they are the ones that do that,” he stated.

Sharing some of his concerns, Blair talked about rising fuel costs, outdated technology, the need to replace old school buses and the increased maintenance cost incurred with an older bus fleet.

Blair said they were looking at every position and program. “And we have to decide what is important to us to preserve,” he shared. “Then the other choices are what can we do without and what can we reduce.”

Referencing rumors about Gold Hill Elementary, Dr. Blair said that the non-personnel cost to run Gold Hill is about $160,000 a year and he did not plan to recommend closing a school for that amount.

Adding that he was in favor of community schools, Blair continued, “However, having said that, again, we will look at every single facility and every single dime. We have some tough decisions to make.” He added, “We have our priorities. We have things that we have to do.”

On the following Wednesday, February 22, Blair said the task of trying to balance an already lean budget with a $2.5 million difference in expenditures and revenues required more than budget cuts-it required budget surgery.

He offered, “I don't know if it can get much leaner without some significant deficits in what we do.”

Dr. Blair explained that the work session would involve updating the board on the budget and receiving advice and suggestions from the board on ways to reduce the budget. He added that they would also be going into a closed session to talk about some personnel realignments due to the budget situation.

He shared that along with the new approach to designing a school budget, they were also working with the financial consultant to develop a new detailed funding accountability system.

While discussing additional increases in cost for the Virginia Retirement System, Chairman Allen questioned whether the division could elect not to participate.

Dr. James Dumminger responded that he thought school divisions were obligated to participate once they made that choice.

Imig reiterated that revenues were down across the board. He explained that the switch to add the school division's debt service to the county's budget rather than the school budget was due to the implementation of the GASB, Governmental Accounting Standards Board regulations.

Offering that he did not know how a small school system like Buckingham could compensate for that $2.5 million difference, the financial consultant stated, “I do know this-you really don't want to destroy this school system. If you start cutting back so you just have some basics that is really not what you are about.”

Imig shared, “But it's not just this school district, it's across the nation, too.”

The consultant noted that out of the division's budget, approximately 17-plus million goes to payroll and benefits.

Blair added, “I think the moral of the story from Paul is that most of our budget is spoken for.”

At that point, directors and administrators shared comments relevant to their respective budgets.

According to Imig, as the budget progresses, a trail of the process will be available to show how it developed.

Blair noted that with all of the templates and information, the budget process would be simpler next year and for years to come.

“It's an extremely open process,” offered Blair. “What is going to be very difficult is what do you want to preserve and that is going to be the priority.”