Letcher Schools Supt. Tony Sergent told the Board of Education at its September meeting Monday night that because of shortfalls in revenue, the district must reduce spending in an effort to balance the budget.
“It’s going to take some tough decisions by the board to get us where we need to be,” said Sergent.
The district’s contingency fund totals $663,277.80, which is 2.6 percent of the budget. Although two percent is required, most districts try to keep between five to seven percent in the contingency fund.
“That’s a number that’s definitely trending dramatically in the wrong direction,” said Sergent. “If we had continued on to do the things we wanted to do, we wouldn’t have had two percent so we had to back off of some things.”
Two new school buses estimated to cost $200,000 was struck from this school year’s budget as well as new camera systems for current buses and $23,000 for paving and striping parking lots at Letcher County Central High School.
“Buses is something that is going to eat us alive one of these days,” said Board Member Will Smith.
Smith said the district’s fleet is getting older and at some point the district is going to have to bite the bullet and buy more buses. Two buses were purchased for last school year.
Although board members had expressed a need for new textbooks at meetings back in the winter, money has not been set aside for textbooks in the 2013-2014 working budget. Math textbooks have been estimated to cost about $300,000.
“We were trying to get our contingency back above the two percent,” said Johnson. “We had to cut a lot.”
Even the amount budgeted for diesel fuel has been scaled back, but Johnson said more has been allotted for diesel fuel than was last year.
“The board did pass a four percent increase (on property taxes), which you realize now why I was so concerned getting that done with the situation we are in,” said Sergent. “We predicted revenues of that of about $180,000. This budget includes that additional $180,000.”
Support Education Excellence in Kentucky (SEEK) allocation is down $415,368 from last school year.
The district’s amount it pays for retirement is increasing. The district will spend at least $200,000 on rank changes and an increase in years’ experience for employees.
“The state keeps decreasing the amount of money they give us,” said Sergent. “They keep increasing the things that we have to pay for and that is where we are.”
Since Sergent began as superintendent in July, he has told the board that $1.3 million needs to be cut from the budget. The district began this school year with about $600,000 less than it did the previous year. It is calculated that revenues are down $722,353.30 from last school year.
“I quoted that number $1.3 million over and over, but now it’s here,” said Sergent. “We’re going to have to account for reducing our spending to balance our budget.”
Attrition and resignations have helped reduce salaries by $414,000.
“That’s significant, but still that’s a long ways from $1.3 million,” said Sergent. “Seven hundred thousand dollars is a lot of money. I want to express the serious of this without setting panic.”
If contingency keeps going down each year, a district will eventually end up in deficit, said Sergent.
“This is the serious part of this,” said Sergent. “It has become a serious issue. There will have to be some serious conversations about reductions in spending. There is no easy solution. It’s going to be some tough decisions that are going to have to be made, but it’s here now. Decisions will have to be made before we start school next year.”
The working budget the board approved Monday night does include technology matching funds, about $80,000 to repair the roof at Letcher Middle School and $4,541.72 to repair the chimney at Arlie Boggs Elementary School, which Sergent said is in danger of collapsing.
“It just needs to be done,” said Sergent. “It’s going to fall.”