D-26 unveils 5-year budget
CARY – District 26 officials expect to go at least two years without budget cuts, according to financial projections.
The district has three scenarios – lower-than-anticipated funding, the anticipated level of funding and higher-than-anticipated funding – in its five-year plan, and in any case can avoid budget cuts at least through the 2014 fiscal year, officials said.
The worst-case scenario calls for $100,000 in budget cuts in 2015 and 2016 and a $600,000 deficit in fiscal 2017.
The further you go out, the less accurate the data, Director of Finance and Operations T. Ferrier said.
If funding comes in as anticipated, the district expects to have balanced budgets for four years and a $600,000 deficit in the 2017 fiscal year.
Surpluses are expected in the 2013 and 2014 fiscal years, which might be good for textbook purchases, capital projects or other one-time purchases “that don’t have to be sustained from year to year,” Ferrier said.
“As a steward,” said board member Jason Larry, “you want to see surpluses every single year. “In the five-year projection ... every one of these numbers is tough,” he said. But it’s a “great start,” he said, that projections are for small surpluses in fiscal years 2014, 2015 and 2016.
In the best-case scenario, the district expects budget surpluses through the 2017 fiscal year.
The financial projections look at property values, tax levy extensions, possible student needs, possible growth, enrollment figures and contract provisions.
Staffing remains flat in the financial plan.
A technology plan implementation is included in the projections for fiscal 2014 through 2017.
But the possibility of the district having to pick up part of the state’s contribution to teachers’ pensionsis included. Insurance increases also are incorporated into the plan, Ferrier said.
Capital projects will increase slowly under the financial plan.
“We’re trying to build back up that capital improvement category, because honestly, this district has cut the capital improvements budget down to an unrealistic level,” Ferrier said.
The financial plan takes into account corporate property taxes going away in fiscal 2015 as the state looks to use that money for other expenses.
In fiscal 2014, the district expects to have a $600,000 surplus in operating funds if revenue comes in as expected.
The financial plan has many unknowns, such as the economy, state legislation and the rate of inflation.
“That’s the other reason why you wouldn’t want to necessarily spend ... this $600,000 surplus because this could still change,” Ferrier said.
The district expects expenditures to remain flat in the coming years because of declining enrollments and the retirement of older, more expensive teachers. However, the 2016 and 2017 fiscal years could be different stories.
“The largest fluctuations occur in FY16 and FY17 when there are no scheduled retirement cost savings to offset increasing expenses nor are there any retirement accruals to reduce salary expenditures,” according to the financial plan narrative written to the school board.