With Thursday’s tentative adoption of a 2017-18 budget, the Bulloch County Board of Education backed not just the state-funded teacher raise, but a 2-percent pay raise for all 1,400 employees and will fund schools for “local values” such as added counselors.

Before approval, the new local-values funding was reduced to 70 percent of the amounts Superintendent Charles Wilson and Chief Financial Officer Troy Brown suggested in the original budget options. Besides a suggestion for more counselors and art, music, physical education and other special-subject teachers, the local values funding brings a boost for schools with higher poverty rates and cash for extracurricular activities and faculty and staff training.

The budget still calls for spending $2.2 million more than the school system is projected to receive in revenue, even after increases in state funding totaling almost $5 million. For a third consecutive year, the board will reduce a general fund reserve built up earlier in the decade.

“As you all know and we discussed, obviously this trend is not sustainable,” Wilson told the board before Thursday’s vote.

ESPLOST ahead

With no property tax increase proposed, school system officials have started talking about shifting costs of items such as books and buses to the Educational Special Purpose Local Option Sales Tax. The ESPLOST, so far used mainly to fund building projects, is paying bond debt on prior work to finish out its five-year run through 2018, but could be extended by voters in a referendum this November.

“But what we are looking at is the opportunity to redistribute some expenditures throughout our district based on extension of ESPLOST, and if that doesn’t work, we will have to look at other options,” Wilson continued.

Those other options would cut spending or increase the property tax millage rate for future years.

Wilson recommended the version of the budget including the 2-percent raise and 70 percent of the proposed local-values funding. On a motion from District 5 member Glennera Martin, seconded by District 6 member Jay Cook, the board tentatively adopted the budget on a 6-0 vote with two members absent.

The budget is to be advertised before final adoption May 11. It is for fiscal year 2018, which begins July 1, 2017.

The open portion of Thursday evening’s meeting lasted barely five minutes, and there was no further discussion of the budget. But board members had discussed budget options during a special workshop meeting at 7 a.m. the previous Saturday, April 22. That meeting was also open to the public and was covered by the Statesboro Herald.

April 22 options

Brown presented four main options. The most liberal in spending would have included a 4 percent raise for all employees as well as 100 percent of suggested local-values appropriations to the 15 schools.

Wilson and Brown proposed the local-values funding as a way to partially even out differences in per-student funding among the schools. Principals will decide how this money is actually spent, with the values numbers serving as guidance on the school system’s priorities.

The maximum option would also have pushed expenditures to $92.7 million, exceeding the $88.4 million in expected revenue by $4.3 million, Brown projected. That would have reduced the fund balance to $9.2 million, a reserve roughly equal to 10 percent of budgeted spending.

Under state rules, 15 percent is the maximum for school district operating fund reserves, but Brown says that 15 percent is actually a healthy cushion against unforeseen circumstances.  Bulloch County’s reserve exceeded 20 percent when the fund balance topped $19 million a few years ago.

The second and most conservative budget option was to fund only the 2 percent state-mandated pay raise for teachers, without extending it to other employees. That would have reduced the annual deficit to $1.3 million, and maintained a $12.2 million, or 13.6 percent, balance.

A third option would have funded only the teacher raises and all “local values” except $900,000 in local grants to the schools based on their numbers of students from households with incomes below federal poverty thresholds.

However, board members made clear that they did not consider passing along the raises to certified educators, without providing raises to other employees, as a serious option.

The state government sets salary scales for teachers, and the Legislature and Gov. Nathan Deal have funded the teacher raise. But the state does not fund salaries for school employees such as custodians, cafeteria workers and paraprofessionals.

Poverty funding

Much of the board’s April 22 discussion centered on the fourth option. It included the 2-percent raise for all employees plus funding all of the local-values items except the poverty funding. This option would also have resulted in a projected $2.2 million excess of spending over new revenue.

However, District 3 board member Dr. Stuart Tedders said he was reluctant to discard the idea of giving schools with higher poverty rates more help.

“I’m not sure there aren’t other options that can’t be explored,” Tedders said.

He suggested funding a percentage of all the local-values items. In the plan that emerged, the overall cost will be the same as if the poverty funding had been dropped, but the distribution among the schools will be different.

Brown did the math and presented the 70 percent local-values option. With expenses of $90.6 million, he projects a year-end balance of $11.3 million, a 12.5 percent reserve.

Lower deficit

Although the balance is still shrinking, the new budget’s deficit is less than the $3 million of spending in excess of revenue now projected for the current fiscal year, ending June 30.

Earlier this month, Brown gave the board a projection that state funding to the Bulloch school system will increase by $4.97 million for fiscal 2018.

But $2.8 million of that will be needed for the state-mandated teacher raise, required increases in retirement contributions, step increases for employees’ years on the job and increases in benefits costs.

After Thursday’s brief open session, the board went into closed session around 6:40 p.m. and was still meeting at 7:30. The board had also held a brief closed session after the April 22 workshop.

Members are discussing Wilson’s job evaluation, which could result in changes to his contract or stated expectations.

Herald reporter Al Hackle may be reached at (912) 489-9458.