Agenda - 05-19-2009 - 7b - Laserfiche WebLink

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The Superintendent's Budget Message for 2009-2010 The current economic downturn is.having a tremendous impact on school budgets all across the country. Not being immune to these conditions, both the State of North Carolina and Orange County Govenunent are experiencing major revenue declines and impending budget shortfalls. Since 96% of Grange County Schools' operating budget comes from these two sources, the district's 2009-2010 budget will likely be significantly reduced from the funding levels to which we have grown accustomed. The state funding situation, with its projected three billion dollar deficit,'has been described as "a crisis." The governor has responded by slashing the funding for state agencies, compelling Orange County Schools to return $279,000 to the state in December of this school year. Governor Perdue's 2009-2010 budget allows $144 million less for public schools. Her plan is to offset these cuts by using some of the $1.84 billion in federal recovery dollars to "save jobs and ease this reduction." Grange County school officials are currently planning for a 5% reduction in the funds that we receive from the state. As North Carolina's constitution requires school districts to have a balanced budget, our options are very limited. Unfortunately, this scenario would result in $1.6 million less for next year's operations. Rising employee healthcare costs and increased district contributions to the state retirement plan will also place stress on the system's finances. Governor Perdue's budget calls for increasing the per person-employer's contribution to the retirement plan and raising the contribution to the health plan by 7.4%. These increases would cost the district an additional $73,000 for which we will have to budget. Orange County Government is also experiencing major declines in revenue. Local sales and personal property taxes are down by nearly $9 million when compared to the same period last year. Additionally, the North, Carolina Association of County Cornrnissioners has advised county governments not to budget state lottery proceeds and public school building funds. Grange County uses these funds to service the debt associated with school construction and this will no doubt result in fewer dollars allocated to the schools. when the County Commissioners approve their budget, we are expecting to receive 5% or $1.32 million less in our county's appropriation. The superintendent's 2009-2010 recommended local expense budget of$23,490,654 includes the projected $189 per student reduction in local funding. Orange County Schools expects to receive 5% less per student frorn the Board, of County Commissioners. Additionally, we are projecting an additional 1.9% decrease in other revenues such as fees and indirect costs. The total local budget reduction for next year is projected to be$1.76 million. Unfortunately, there is no way this budgetary reduction can be addressed without reductions in staff. Eighty-three percent of the expenses in our district are directly related to personnel--our funds are in our people. The district-wide administration and staff will absorb the largest proportion of the cuts. These cuts include district-level clerical positions, assistant principal months of employment., two coordinator positions, the energy management position, permanent substitute positions, and the lead nurse position. Some of the recommended school-level personnel reductions include trimming the under-enrolled middle school French programs, offering Spanish in grades 4 and 5 only, and cutting the K-8 media assistant program. A number of non-personnel reductions are designed to minimize the negative impact on the classroom. These reductions include rewards arid recognitions, curriculum and instruction supplies, local workshop allotments, travel reimbursements, supplies and materials purchases, funding for middle school afterschooi programs by 10%,.principal travel allotments, recruitment incentives, the teacher voucher program, fund transfers to Child Nutrition, budget allotments for diesel fuel, and tuition reimbursements. In spite of this gloomy budgetary environment, there is some good news. Orange County has the lowest unemployment rate in the state and continues to provide nearly half of its revenues to the school systems—we are fortunate to have residents and elected officials who are strong supporters of the Grange County school district. Additionally, the Board of Education and the administration have been actively engaged in identifying efficiencies and reducing costs. For the current year, we cut expenditures by $1.5 million and eliminated 6.5 district-level positions. Even with this reduced level of funding, the district maintained an excellent educational program and strengthened core instructional activities. Our current plan minimizes disruptions to the instructional program, limits personnel shifts and reductions, and demonstrates our commitment to good stewardship of taxpayer dollars. The district is committed to minimizing the effect of the budget cuts on classroom instruction and to efficiently utilizing all available resources in order to provide our students with an outstanding educational experience. In spite of these austere budgetary measures, we are confident that we will not reduce the quality of core classroom instruction in our district. we will meet these challenges and use them as an opportunity to concentrate our resources on school improvement and raising student achievement. An organization's true character is revealed during tough times. we view these challenges as an opportunity to seek new and better ways of doing things. School improvement starts with teachers and happens classroom by classroom, school by school. The Orange County school system remains committed to its core unit, the individual classroom. Even through these tough financial times, we are confident we have the teaching talent and resources necessary to maintain our commitment to excellence.