DEMOREST - The Habersham County Board of Education has begun working on its budget for the 2014-2015 school year, realizing it will face even more financial challenges than ever.
At its meeting Monday night at Demorest Elementary School, the board heard from Superintendent Matthew Cooper and Chief Financial Officer
Staci Newsome that the projected numbers give reason for concern.
Even though the county school system will receive $1.5 million more in state funding for FY-15 than in FY-14, that money will not keep pace with the growth in operating expenses, the reduction in the local tax digest, and the resulting $664,851 loss in local revenue, officials said.
"Expenses are outpacing any increased revenues that we get," Cooper said.
Known additional expenses for 2015 include the following:
* $248,000 in employer cost for 30 advanced degrees, including benefits;
* $640,000 in employer cost for years of experience step changes;
* $552,600 in employer cost for 307 current classified employees covered by group health insurance (additional $150 per employee per month);
* Unknown as of now employer cost for 447 current certified employees covered by group health insurance;
* Unknown as of now employer cost for current certified and classified employees not covered by group health insurance; and
* $309,696 in Teachers Retirement System employer contribution increase from 12.28 percent to 13.15 percent of applicable gross salary.
That amounts to $1.75 million in total additional expenses that are known as of now.
Total projected salary cost for 2015 is $38,725,505, while total projected benefit cost is $15,047,727, for a total of $52,235,461. That means that 90 percent of the system's proposed $57,841,972 budget is directly related to salaries and benefits.
Cooper said the system figured in six reduced contract days for 2015, resulting in $1,537,771 in cost avoidance.
"We started the budget process tonight," Cooper said. "We're actually getting started much earlier than a lot of school systems around the state. We had a projected FY-15 budget snapshot to present to the board of education tonight.
"Really, the highlight of that snapshot is the state funding that we're not receiving," Cooper said. "We were able to point out that we're projecting this year $5 million will be withheld in state funds that we actually earn - that the Habersham County School System actually earns - so that's created this gap between our revenues and our expenses of over $2 million for the upcoming year. Actually, it's closer to $2.7 million between our revenues and expenses, because of what's called the Amended Formula Adjustment. We desperately need for the state to give us some of those funds back that we've earned."
Since 2003, the Habersham County School System has experienced $40,878,148 in Amended Formula Adjustment Cuts to its QBE.
The cuts started with $565,033 in FY 2003, then reached as high as $6,451,452 in FY 2010, before leveling off around $5 million for each of the past four years. That projection is for $5,092,605 in FY 2015.
That amount has reached $3 billion statewide, board members learned at the Georgia School Boards Association Annual Conference, held Dec. 5-7.
Cooper said a tax increase in Habersham County is not possible.
"The taxpayers of Habersham County are doing more than most communities in this state," Cooper said. "Our taxpayers are literally doing the maximum right now that they can do so we cannot put any more on our local taxpayers. Our hope at this point is for the state to give us at least some of that Amended Formula Adjustment - that $5 million. Just a little bit of it would help us balance our budget, and help solve these financial woes that we're experiencing."
A report entitled "The Schoolhouse Squeeze," prepared by Georgia Budget & Policy Institute, was cited during Monday night's meeting.
"We're not lonely in this issue," Board Member Don Corbett said, adding the report was discussed during the GSBA event.
Cooper agreed, saying, "Quite a few school systems have reduced school days to 160 and students and staff work until 5:00."
Corbett cited the top of Page 3 of "The Schoolhouse Squeeze" report by GBPI.
"Since 2003, the legislature underfunded schools every year," the report states. "The QBE formula calculated the specific amount that each district needed to provide a quality education to its students, but the legislature failed to provide that amount. Since 2010, Georgia spent $1 billion less on public education each year than the state's own formula says schools need."
Cooper said the system will prepare for the worst, but work as a team to face the financial challenges ahead.