Agenda - 04-26-2011 - 1 - Laserfiche WebLink

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FY 2011 -12 School Budgets State budgetary actions continue to negatively impact local funding. Previous actions include the State seizing Public School Building Capital funds, reductions in lottery proceeds, and (ADM) in FY 2009-10. To date these funds have not been restored or funded at prior levels. The General Assembly has not yet balanced the State budget. It is important to note, in past years, the State has balanced its budget by withholding monies to which counties are entitled. Some of the issues that would affect FY2011 -12 School budgets statewide include: • 8.8% reduction in K -12 education, or $694 million - Elimination of Teacher Assistants in grades 2 and 3 - Reduction of School Bus purchases by $20 million each year 10% reduction in funding to Community Colleges • Seizure of Lottery Proceeds for operations During past Manager's /Superintendent Meetings, the County Manager advised both School Superintendents of the budgetary issues facing the County in the preparation of the FY2011 -12 Budget. The County Manager has shared his opinion with the Superintendents, that it would be very difficult for the County to fill gaps in funding where the State reduces its financial commitment to education. During tonight's presentation, each system will share their FY2011 -12 operating and capital budgets with the Board of County Commissioners. Resolution Regarding Uses of Potential Revenues from a One - Quarter Cent County Sales and Use Tax At it's April 19, 2011 meeting, the Board of County Commissioners approved a resolution establishing a ten year commitment to allocate Article 46 one - quarter cent County Sales and Use Tax as follows: • 50% of the funding will be allocated in an equitable manner between the County's two school systems for funding capital projects. • 50% of the funding will be allocated to Economic Development initiatives. FINANCIAL IMPACT: Preliminary FY2011 -12- revenue projections anticipate the County's General Fund revenues will be approximately $176 million, an increase of $0.75 million from FY 2010 -11 General Fund revenues. Staff has assumed no receipt of Public School Building Fund monies in this projection for the County's General Fund. (Note: NC Education Lottery proceeds are revenues budgeted in individual capital projects and not considered General Fund Revenue.) Based upon the County Commissioner's funding target of 48.1%, and an estimated increase in the County General Fund Budget for FY2011 -12 of roughly $750,000, a slight increase in funding to the two school systems would be required to reach the 48.1 % target. (See Attachment 6)