Minutes 05-12-2022 Work Session - Laserfiche WebLink

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14 Commissioner Hamilton asked what gets the fund balance from $8.5 million to $12 million. Jonathan Scott said that out of the $5.5 million they have appropriated, he thinks they will only spend $1.5-2 million. He said they are required to pass a balanced budget. Commissioner McKee asked what the minimum fund balance is supposed to be. Jonathan Scott said it is 5.5% or roughly $4.5 million. Commissioner McKee asked if the required amount Is $4.5 million, what is the purpose of having a fund balance projection of$12 million. Jonathan Scott said the purpose of the $12 million is where they will end at the end of the year, and it gives his Board direction on what will be needed to balance the budget. Commissioner Bedford said that part of the fund balance issues is just timing. She said that the school system received federal allotments, but they did not know how much beforehand. She said that you do not have to spend all the money in one year, but the timing does allow the use of future fund balance that is from the federal dollars. Commissioner McKee said that is logical, but his concern is that it is a trend of very high fund balances of the Chapel Hill Carrboro City Schools systems to have above what is required. He said that by carrying more than what it is needed, they are not addressing concerns and they are losing teachers and are unable to recruit new ones. He said the county has allocated more cumulative increases per student than the 20th funded in the state and he is trying to understand it. He said if it is funded, it will require a 1 cent tax increase. He said that it will not affect a lot of people but there are thousands that it will. He said that he needs to be able to understand why the system needs to carry the fund balance. Dr. Nyah Hamlett said the Board uses fund balance to balance the budget and to address non-recurring expenses. She said they used fund balance for bonuses. Jonathan Scott said they also purchased shade structures with it. He said that if they appropriated $8 million to balance the budget, then they would have $4 million in unappropriated fund balance and if they spend it all, they will have an $8 million reoccurring expense and he would have to request $8 million next year from the county. He said that would just be a request to cover the costs from the previous year and would not even begin to address continuation costs for the next year. He said that if they do that, he will have an $11 million request and only have $4 million in fund balance. He said that using fund balance for recurring expenditures is dangerous because they can quickly find themselves at a significant funding cliff. Chair Price said teachers said they are still using their own funds to fund school supplies. She asked if fund balance could be used for that. Dr. Nyah Hamlett said they used ESSER funds to allocate $20 per student across the district so they could use that funding for instructional materials and supplies so there have been funds allocated for those purposes. She said there are other sources that provide support for those services. Dr. Monique Felder, superintendent of Orange County Schools, made the following presentation: