Schools' funding standard criticized

Wednesday, September 2, 2009

Marshall County's Budget Committee has again asked the School Board to cut spending, prompting local debate on a requirement for "maintenance of effort," meaning school budgets can't be lowered, they can only be increased.

State, federal and local funding to county schools here is about $32.9 million and, with a fund balance that's grown because of spending restraint by the system, the budget is at about $34.7 million. County funding is approaching $11.12 million.

County commissioners want to avoid increasing the property tax rate of $3.09 per $100 of assessed value and have cut some fire department funds and sought to lower costs for general county employees while school employees retain so-called step raises.

"We did not ask you to cut teacher pay," Commission Chairwoman Mary Ann Neill told Schools Director Stan Curtis, Schools Budget Director Janet Wiles and Board member Craig Michael during a budget meeting on Thursday when it concluded with the second request for reduced spending.

A repeat of the Board's 6-3 vote to hold the line is anticipated by Michael as Neill fears a "potential disaster" when federal stimulus money ends.

"It's going to be a whammy next year," she said, anticipating a continued decline in property tax revenue and an end to federal aid.

A continuation of last week's debate on the state's requirement for "maintenance of effort" continued Monday night among Michael, Neill and Commissioner Rocky Bowden, a long time commissioner who's a retired vice principal.

Confounded by what might be called an entitlement, Neill said, "We're not trying to give them less money. We're trying to maintain the fund balance."

State auditors recommend fund balances be at least three percent of spending and Neill was concerned about school spending from what's sometimes called reserves or a rainy day fund.

"If they continue to spend into the fund balance, then we will have to replenish the fund balance," Neill said.

The Board's next regularly scheduled meeting is Sept. 10. No special called meting has been set, a system spokeswoman said Tuesday afternoon.

County commissioners meet Sept. 15 to adopt a budget for a fiscal year that started July 1. Adoption of a budget after September threatens state funding to county schools.