May 20, 2014

Returned furlough days included in Murray schools tentative budget

CHATSWORTH — The Murray County Board of Education hasn’t raised taxes in 12 years.

And that’s not likely to change any time soon, current members of the board of education said. In fact, they say the school budget is so healthy that the board can return two days to the next school calendar, which begins on July 1.

The board voted 5-0 Monday night to adopt a tentative budget that includes the additional days, which will cost roughly $1.2 million more than last year. A budget projection provided by the school system assumes $51.78 million in revenue and $53.41 million in expenses for fiscal year 2015, which also begins July 1.

Board members said the $1.63 million deficit is expected to be taken out of the fund balance, which is money set aside to cover payroll in winter months when revenue streams typically dry up. That “rainy day” fund will be reduced from $5.25 million to $3.62 million.

The tentative budget is not official until it is approved at the board’s next meeting set for 6 p.m. on June 9. Meetings are held at the central office, at 715 W. Chestnut St.

The system cut eight days from the calendar when the national recession led to reduced state funding in 2008. With the two additional days, on top of two days returned last year, the school system will still have four days still cut from the calendar.

Steve Loughridge, director of school finances, said there was room to restore all furlough days to the budget next school year by taking out of the fund balance further.

“But it’s not prudent to do that,” Loughridge said. “Not right now.

That’s because state funding — while “very much restored” from previous years — isn’t guaranteed to stay that way, he said. State funding went from $35 million in the 2013-2014 fiscal year to an expected $38.1 million in the tentative budget. Gov. Nathan Deal signed that funding restoration into law in April.

“We think it is better to ease into restoring days,” Loughridge said.

He added that the reason the fund balance has been growing despite the appearance of deficit budgets on paper is because school leaders have come under the budget as much as possible throughout the years.

“We never want to use 100 percent of our estimated budget,” he said. “We want to come under to find savings.”

Last fiscal year’s budget assumed a $2.1 million deficit and instead the board added to the fund balance by $1.35 million.

One example of how school officials could add to the fund balance again is in teacher retirement, Loughridge said.

“This budget allows us to hire teachers as needed without having to worry about how we would pay for them,” he said. “We have six or seven teachers retiring. But if enough students don’t show up and those spots are not needed than we won’t hire and that will be one place we find savings.”

Board member Frank Adams said the community should understand that the tentative budget is just that — tentative. Changes to funding are possible, several board members said, before final approval.

“Sometimes the public sees the budget and doesn’t see it is tentative,” Adams said. “They don’t always read the details.”

 Loughridge said the board should be commended for maintaining a tax rate of 15.5 mills over the last 12 years. He added that board member should be prepared for “phone calls” because of the expected tax rate increase in Dalton Public Schools. A raise on taxes, he said, always puts the spotlight on comparing school systems’ different tax rates.

Members of the Dalton Board of Education plan to raise property taxes from 7.845 to 8.5 mills, which is not lower than the 15.5 mills in Murray County, Loughridge said. That’s because Dalton taxes on 100 percent accessed value of property, whereas Murray schools tax at 40 percent (more typical of the rest of the state).

A mill represents $1 of tax for every $1,000 of assessed property. For a $100,000 home without exemptions, a homeowner in Murray pays $620 each year. For the same value house in Dalton, a homeowner pays $784.50 a year and is expected to pay $850 a year if the new rate is approved.

“The takeaway is that you can’t go around comparing apples to apples (based on a millage rate),” he said. “The fact that we’ve stayed at the same rate for 12 years means we are financially strong and in good financial shape.”

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