Preliminary 2010-11 school budget presented

PLYMOUTH – In presenting the 2010-11 preliminary budget, Jon Miller, the school district’s manager of business services, described the situation as follows:

“We are doing everything we can on a daily basis to nickel and dime ourselves into prosperity,” he said.

School districts throughout the state are finding themselves in a precarious financial situation, due in large part to the reduction in revenue they are receiving from the state and to the state-imposed revenue caps.

The Plymouth School District is in fairly good shape for 2010-11, but such is not the case for the following years. Thus, countless hours are being spent to address the situation.

Miller provided details of next year’s budget. The projected levy for 2010-11 is $10,903,399, reflecting a 3.1 percent increase over this year’s levy of $10,576,250.

Projected revenues for 2010-11 in Funds 10 and 27 are $25,816,773, with projected expenditures of $26,211,018 – reflecting a deficit of $394,245.

The deficit is due to three reasons:

.The growth rate of anticipated salary and benefits, which comprise 80 percent of the school district’s budget, are outdistancing that of revenue growth.

.The attempt to maintain most services, supplies and equipment budgets as in the prior year.

.Open enrollment continues to have a large negative trend.

However, due to the current year’s $300,000-plus surplus, the district basically has the 2010-11 school year to come to some decisions about its future direction.

Miller explained that the reason for the surplus in this year’s budget is because of under-budget spending in many areas. These include:

.Substitute teachers and overtime pay .Tuition reimbursement for teachers .Maintenance services and repairs .Employee travel .Telephone services . Natural gas for heating .Limited use of maintenance contingency .New district financing methods

.Lots of under-spending in small ways throughout the district.

Miller pointed out too more than $600,000 of maintenance projects have been identified, with $256,000 specifically requested for the next school year. Only a small ADA compliance project of less than $100,000 will actually be scheduled. Projects not budgeted include:

.Window replacements, plumbing upgrades and new carpeting at Parkview Elementary

.Window replacements at Horizon Elementary

.Electrical system updates, roof-section replacements and window replacements at Plymouth High School

.Cupola installment and shingled roof replacement at Riverview Middle School

.Tuck-pointing district-wide

While the district appears to be in fairly good financial shape for the approaching school year, the budgeted deficit, further loss of federal revenue and the growing gap between the growth in revenue and expenses could point to a $1 million deficit, without a significant change.

Overall revenues are antici9pated to increase 1.94 percent, with the majority coming from a $200 perstudent increase in the state revenue limit. The district can receive up to $9,422 per student from the combination of property taxes and equalized state aid in 2010-11.

Also, next year, additional revenue changes will take place, since it will be the second year of the federal stimulus money the district received. In 2010-11, the Title 1 grant will be reduced by $22,000, and the Alternative Education Grant will be $36,000 less than it was this year.

Regarding personnel changes, the current teachers’ contract has a 3 percent actual cost settlement fallback position. Thus, the loss of FTE’s (full-time-equivalency students) will not reduce overall compensation for one year.

The school district’s medical insurance policy premium increase is projected at 12 percent. Dental rates are nearly flat, with no increase for the family plan and a 4 percent increase for a single plan.

WRS (Wisconsin Retirement System) rates are expected to increase 5.5 percent on Jan. 1, 2010. Support-staff negotiations are on-going, and non-union staff members have a very conservative wage and benefit increase in budget assumptions.

Regarding open enrollment, the budget projections for next year, Miller pointed out, were prepared on a best-case scenario for students entering the district in revenues, and on a worst-case scenario for students leaving the district in services expenses. Both numbers will decrease by September, he said.

Regarding the hot lunch program, the program will likely show a small deficit for 2009-10. While the program remains solvent, declining sales are being experienced. When ticket prices were raised, total revenue declined.

Board member Jerry Prahl asked whether the hot lunch program’s menus are set by state and federal guidelines.

Miller said that the state and federal government set up nutritional guidelines and that there are opportunities for the district to purchase government surplus food at reduced prices.

Kristin Rooker, the district’s food service director, pointed out that the Wisconsin Department of Public Instruction and the state have requirements the district must follow.

“Students have to take three of the five foods offered,” she said. “Those foods are proteins, fruit, vegetables, milk and bread. They can decline two of the five.”

Reinke pointed out that 23 percent of the families in the district qualify for free or reduced-cost lunches.

Prahl noted that he has seen students throwing food away and wondered whether the district could purchase less food.

“We are keeping production sheets to quantify that [what foods are being thrown way],” Rooker said.

Board member Tim St. Clair asked whether there are caloric requirements for the foods served, and Rooker answered affirmatively.

St. Clair said he is concerned about the deficit in the hot-lunch program. “I will not help subsidize the lunch program, by way of any budget funds,” he said. “This is a federally mandated program.

He pointed out to The Review Wednesday, “If Washington feels they can manage a program better than our own supervisors, that is ridiculous.”

Miller also addressed the community education budget. The levy is estimated to be $250,000 in 2010-11 to cover expenses that are not covered by program revenues – programs such as day care, fitness classes and evening classes largely covered by fees charged and that make some contribution to overhead.

The community education levy supports the police liaison program, middle-school extra-curricular program and community education overhead.

Miller stressed that the budget deficit will reappear in 2011-12. At the starting point of 2011-12, there will be a $347,000 loss of federal stimulus aid and a $37,000 loss with the end of the AODA grant. The result is a $784,000 deficit, before any changes in revenue or cost. Given the trend, costs are outpacing revenue. Something close to a $1 million deficit appears likely, without any significant change

“The year of good fortune bought us a year to prepare,” he said.

Prior to Miller’s presentation, Reinke pointed out that there are still many unknown variables to next year’s budget. However, “Planning for the 2010-11 budget began in 2008,” he said.

“Because of the different decisions we had to make and due to the effective management of those involved in the budget process, we believe we have a solid business plan.

“We will not only preserve the education model, which is our top priority,” Reinke said. “I think we will be able, due to grants and special professional-development opportunities, be able to enhance the educational program for students next year.

“Given the fiscal challenges, we can have high expectations and hopes,” he affirmed. “We will continue to work on the budget and revise it until August. The levy will be certified in October.”