The district should expect some tightening of the purse strings in the academic year to come, finance director Don Fleu is expected to tell Boyd County school board members tonight.
Fleu plans to review revenue and spending projections with the board as the district enters the beginning of the budget planning season.
The district will receive less state aid per student in 2014, and local revenues have sagged, which means the board will have to look for ways to reduce spending and possibly raise more money, Fleu said.
One way to reduce spending is to reduce staff, he said. Layoffs are a possibility although retirements and attrition are more likely, he said. The board may want to adjust its staffing formulas at the middle and elementary levels. The current standard is 23 students per teacher; changing that to 25 would mean the school could employ fewer teachers.
The reality “probably would not be as draconian as proposed,” Fleu said. The district has to submit its staffing formulas to the state this month, so will craft them to meet worst-case scenarios. But if the budget picture gets brighter, it is easier to add positions than to take them away.
The high school already operates under a 26 to one ratio and that is unlikely to change, he said.
The district is anticipating less revenue from the state, which is cutting per-pupil aid, and also is likely to get less utility tax income, he said. That is because mild weather has meant district residents have used less energy. Last year’s budget, for instance, anticipated $2.6 million in utility tax income, but the district only collected about $2.3 million. The same is likely this year.
Falling interest rates have cost the district much of the income it typically receives from its invested balances — from $100,000 per year to $10,000.
Insurance costs are likely to go up, especially following the folding of the Kentucky School Boards Insurance Trust. Other costs, such as building operation and bus fleet maintenance, also keep rising inexorably. The bus situation is exacerbated by the aging of the fleet as the district puts off buying new ones.
The board has few options for bringing in new revenue unless it raises property taxes, and it is a long way off from making that decision.
Fleu said he is not ready to discuss specific budget proposals but will recommend the board meet again later on to develop some budget proposals.
MIKE JAMES can be reached at firstname.lastname@example.org or (606) 326-2652.