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School funds: Cotton warns of cuts
Friday, April 4, 2014
By PAUL COLLINS - Bulletin Staff Writer
Henry County Public Schools appreciates the $75,000 in extra funds provided for the schools in the proposed 2014-15 county budget, but the school division will have to make cuts to balance its budget and will not be able to address a list of needs if that is all it receives, Superintendent Jared Cotton said Thursday.
The Henry County School Board requested a total of $17,054,742 in local funds, which is $476,847 (2.88 percent) more than the current year’s funding.
County staff recommended a local contribution to the school system of $16,652,895, a $75,000 increase over last year’s local allocation,
The request for an additional $476,847 included: $187,930 for three items that the school division has no choice but to fund, Cotton has said. They are $151,616 because of such things as an 8 percent increase in health insurance premiums and an increase in Virginia Retirement System rates; $26,314 because of VRS group life percentage increase from former Gov. Bob McDonnell’s budget to House and Senate versions from 1.24 percent to 1.32 percent; and $10,000 to cover increased fees due to raises provided by the county to school resource officers, Cotton has said.
It also included: $79,712 for three additional health office assistants to serve elementary schools; $37,407 to adjust contracts of two curriculum staff employees from 10 months to 12 months; $52,116 to restore a general maintenance position to support facilities/maintenance; $55,712 for a position to support budget/finance; $60,740 to restore stipends for academic and athletic coaches to the 2011 “factor” (level), including FICA/Medicare; and $3,230 to employ summer “student” interns for facilities/maintenance.
The proposed county budget recommends an increase of $75,000 to help cover the $187,930 in required costs. It adds that if the board of supervisors wishes to cover the remaining $112,930 of that amount, county staff suggests the board take it from another budget recipient rather than out of reserves. It adds that funding operations out of reserves generally is considered to be bad policy.
“While we appreciate the additional amount above ‘level funding,’ this does not address the needs that total $476,847. As a result the school division will not be able to address many of the needs that were included in that number,” Cotton said.
If the board of supervisors does not approve the additional $112,930, he said, “We will have to make additional cuts to an already lean budget to make up for the shortfall. Over the past several years, we have run out of places to make these cuts. Certainly, these cuts will/could have an impact on the quality of services we provide for our students.”
No decisions have been made on possible cuts, he said.
Cotton said he agrees that funding from reserves should not be used for ongoing or recurring costs. “This type of funding should only be used to address one-time costs such as technology purchases, replacement buses or capital improvement,” he added.
The proposed budget states: “It also is important to point out that FY ‘15 is the first of a new two-year adjustment in the state’s composite index, which measures a locality’s ability to pay for its educational system. Henry County’s Composite Index will change from .243 to .2407, which means the state has determined that Henry County is less able to pay for its school needs than it was the past two years. The Composite Index adjustment should provide an additional $113,000 in state funds to the school system in FY ‘15 and FY ‘16.”
The FY 2014-15 budget the Henry County School Board approved March 27 already reflects revenue based on a local composite index of 0.2407, according to the school board budget document.
One significant change County Administrator Tim Hall recommended for both the school system and county employees is a change to self-insurance for health care to save money and avoid fees associated with the Affordable Care Act.
“We have met with the county administration several times to discuss this,” Cotton said. “We are planning to give it a try starting with the 2014-2015 school year. There is potential for us to achieve some savings, but there is also risk involved in this if we have a large number of claims in a given year.”
He added: “It will take time to build up our savings, and we are planning to go with the 8 percent increase in health insurance costs (in the budget approved by the school board) to be conservative for this first year. As a result, we will not be able to utilize any savings to address the needed funds for FY 2015.”
The proposed county budget does not address school facility needs in Collinsville and the need for a new jail. It does not recommend a tax increase, but a discussion of an increase may have to take place in the future, Hall has said.
On the Collinsville school issue, Cotton said, “The school board will need to discuss this issue and make a plan moving forward. We hope to have a recommendation by June of this year. At that time, we will need to approach the BOS (board of supervisors) with the school board’s recommendation.”
Summing up, Cotton said of the proposed county budget: “Ultimately, we (HCPS) will not be able to address essential needs, and we will need to cut an already lean budget even further. At this time, I have not determined which cuts will need to be made to balance the budget if Mr. Hall’s recommendation goes through. When the county budget is finalized, I will need to recommend necessary adjustments to the school board for approval.”