Despite a nearly $1 million cut from state funds, the Columbus Municipal School District does not intend to increase city ad valorem taxes for the 2019 fiscal year.
During the public budget hearing Monday night, Chief Financial Officer Tammie Holmes presented the board with the proposed budget for FY 2019, which began July 1. However, state law gives districts until Aug. 15 to approve the budget.
The district’s total projected revenue is just more than $42 million, with expected expenditures $41.6 million — a projected surplus of roughly $600,000.
Board President Jason Spears said the tight budget was designed to avoid a tax increase.
“We are trying to be as close as one-for-one as possible,” Spears said. “It’s just because of the continued reduction of state and federal funds.”
The district’s reserve funds total between $5.5 million and $6 million, Holmes said, which is about 20 percent of the $29 million in the district’s maintenance fund. The state suggests maintaining at least 7.5 percent in case of unexpected finances which have not been budgeted. Since the district has a larger percentage fund balance than the state-suggestion, the district will be able to accommodate the shortage of state funding.
Enrollment decrease
Student enrollment decreases were the centerpiece of state funding cuts for CMSD for the new fiscal year. Since 2013-14, district enrollment has dropped by about 800 students, with roughly 3,700 expected to attend CMSD in 2018-19. State funding heavily relies on enrollment and attendance, and the student drop has cost the district $4.1 million — or an average of a little more than $1 million per year — over the last four years.
The district anticipates an approximate $950,000 financial cut this year from the Mississippi Adequate Education Program (MAEP), which funds nearly 44 percent of the CMSD budget.
Trending enrollment upward, Spears said, depends on successfully changing the narrative, and reputation, of CMSD.
“Obviously population has gone down just a little bit,” Spears said. “But it looks like we’re getting more incoming transfers than outgoing transfers, so that’s a good thing, and that’s a steady thing we’ve seen since the end of the last school year. Now it’s just a matter of shifting the paradigm of people’s perception of what the district has been (and that it is) not what it is today. Just like it went down, it’ll start rising.”
Other budget details
Instructional costs, at just more than $20.6 million, makes up 50 percent of the total projected expenditures in the budget, with support services, debt service and non-instructional services collecting the remaining funds.
Although the value of the tax mill decreased from the 2017-18 school year, the district will only request $12.7 million, or 61.17 mills, from local funds, slightly less than the previous request of $12.8 million.
“Since we didn’t collect as much, because we didn’t produce as much, now we have to go ahead and set aside this money because not only do we have to pay this year’s debt, but we also have payments that have to carry over into next year that we have to account for,” Spears said.
Rather than a tax increase to supplement the loss of state funds, the budget shows the district will transfer $330,000 from district maintenance to the general obligation bond debt. Spears said the district and board examined the budget and made financial cuts, without “putting instruction at risk.” With the student population decrease, the district vacated six certified positions, saving the district $401,000 year. The district also cut substitute funding by $200,000.
CMSD Superintendent Cherie Labat started working on the FY2019 budget since entering the district in early June. The budget will be up for board approval during the next review meeting on Aug. 8.
“I’m very proud of Dr. Labat coming in and being able to work with the financial team and getting things in place because that’s one of the things that we needed, with all the chaos that was going on at the end of the last school year, is to have stability for the students and staff coming back this year knowing everything would run as it needs to run,” Spears said.
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