The St. Clair R-XIII Board of Education again was forced to approve a budget for the upcoming academic year that projects expenses will far exceed revenue.
The board supported Superintendent Mike Murphy’s recommended budget during its June meeting last Thursday. The actual approved budget, $20.24 million, is about $414,000 higher than what the projected revenue will be for the year.
For the fourth straight year, the overall budget is lower than in the previous year. The 2013-14 budget totaled $21.58 million.
Projected revenues for 2014-15 — which come from local, state and federal sources — are $19.83 million.
The numbers do not include the Franklin County Cooperative, which falls under R-XIII’s jurisdiction. The co-op’s projected expenses are $3.53 million with revenue expected in the neighborhood of $3.54 million.
As in years past, even though the 2014-15 budget approved by the school board projects expenses being higher than revenue, it was put together with the district operating under the same tax rate, giving raises to staff, providing insurance options for all full-time employees and continuing a plan that emphasizes one-to-one digital learning.
“We are still working with the same tax rate we have had,” board President Dave Berkel told The Missourian after the meeting. “And the administration and the staff are working very hard together to do the very most with the revenues received.
“As everyone knows, there isn’t much in this economy that is going down, so it has been a challenge to retain the programs that we have going to help our students excel.
“Our students are our No 1 priority.”
A budget always is described as a working document that estimates revenues and expenses.
St. Clair R-XIII’s current tax rate is $3.37 per every $100 or assessed valuation. It is split into $2.05 for the operating fund, 70 cents in the teachers fund and 62 cents in the debt service fund. The tax levy has remained the same for several years.
In his budget message, Murphy reminded board members that for the 2014-15 academic year, a $1,000 base salary and step movement increase was approved for certified staff, resulting in an average salary increase of between 2.3 and 4.5 percent.
The new salary schedule base rate for teachers is now $32,500.
Also, for the upcoming year, the board approved step movements on classified employee schedules as well as a 1.5 percent pay increase.
The budget also includes a 3 percent pay hike for assistant superintendents, principals, assistant principals and the special education director. Murphy is entering the third year of his three-year negotiated contract and is getting a 3.44 percent pay increase.
Murphy’s three-year contract, the first of its kind for R-XIII, was worked out in 2012 and has raised his annual pay from $127,000 for the 2011-12 academic year to $150,000 for the upcoming year. He received about a 10 percent pay hike in 2012-13 and about 3.5 percent increases both last year and this year.
As far as the digital learning initiative, the board earlier this year approved spending about $160,000 to be blended into the 2014-15 and 2015-16 budgets in order to put tablets in the hands of kindergartners through fourth-grade students. This will complement and expand the technology program instituted during the last budgetary cycle that provided Google Chromebooks for fifth- through 12th-grade students.
The digital initiative is expected to complement — not replace — textbook learning.
The projected proration factor for state aid will be 97 percent of the total calculation for aid, Murphy said. His budget is based on that figure.
If the formula would have been funded at 100 percent, another $270,000 would have been added to district coffers.
However, the 97 percent is an increase from previous years.
“Advocating for full funding of the state formula is essential in our current fiscal environment with reductions in local assessment, federal funding and student enrollment declining,” Murphy said. “Due to a reduction of assessed valuation, decreasing ADA (average daily attendance) and a lack of full state funding, our district has reached a critical low budgeting period as we review expenditure allocations based on projected revenue for the 2014-15 year.”
Murphy went on to remind his board that because of the shortfalls, the district had to take a critical look at decreasing expenses while maintaining a positive 21st century learning environment for students and providing competitive salaries for staff members.
The first phase of a two-phase program that included staff reductions implemented earlier this year amounted to about $850,000 in savings that will become effective on July 1. Murphy said if inflation estimates continue to rise, the district will need to evaluate further Phase II reductions during 2015-16 or consider methods to increase revenue, including a hike to the operating tax levy.
“As we look to the future, our main focus is to maintain exemplary programs for the children of our community,” Murphy said. “Although we are facing future budgetary challenges, our mission is to provide a digital learning environment where every child is connected every day and staff members are engaged in a professional learning community.”
The latest information on assessed valuation for the R-XIII school district actually shows an increase from last year’s numbers.
According to the latest figures available, 2014’s assessed valuation is $139,554,186 compared to $137,421,150 in 2013. However, the 2014 numbers are not final.
The big hit came from 2012 to 2013. In 2012, the assessed valuation was $147,323,641.
The assessed valuation numbers haven’t been as low as they currently are since 2006.
“Although the assessment figures have slightly increased from August 2013, they continue to create a negative impact of local revenue to be estimated at approximately $325,000 to our schools,” Murphy said. “This drop in assessment value compares to our assessment in 2006-07 and eliminates all assessment growth accumulated to date. The decline in assessment is a reflection of a new electronic system utilized in the county to accurately reflect assessed values of property.”
Berkel also had a comment about the district’s finances.
“Our assessments have been slightly down or flat, and the state has been undecided on what is happening with the foundation formula,” he said. “So, revenue continues to be the issue for the future.”
The R-XIII school district operates out of four funds — operations, teacher, debt service and capital projects.
By law, school districts must pass a budget for the following academic year by the end of June.
Also on Thursday, board members gave Murphy the authority as the district’s chief financial officer to amend the 2013-14 budget on June 30 to reflect actual revenue and expenditures on all line items. Final figures will be brought to the board in July.
The board also gave Murphy the approval of transfers to the capital projects fund.
This are routine housekeeping items that occur every year at this time.