Even with a few state grants providing additional funding, Johnson County School District business manager Tom Sarvey kept things conservative when budgeting for fiscal 2020.
“The fiscal year 2020 proposed budget represents a continuation of adjusting costs to available resources,” Sarvey wrote in a budget statement to school board members. “Recent and significant declines in revenues caused by current economic conditions, coupled with declining average daily membership have highlighted the necessity for long term planning.”
On July 8, the Johnson County School Board approved a $22.23 million general fund expenditure budget for the district. Expenses are down slightly from $22.75 million in fiscal 2019. The decline comes as the district works to make the best use of their dollars in light of a few changes in state and local revenue, according to Sarvey.
The district receives funding from state, county and local sources. State funding for the district is determined primarily by the district’s average daily membership. The district’s average daily enrollment is expected to decline by 6.5 students in fiscal 2020, according to Sarvey, which will decrease state funding. In addition, declining valuation and ongoing tax protests will reduce the amount received from the county.
The biggest decline in general fund expenses will come in capital outlay, which will decline from $1.9 million in fiscal 2019 to $239,000 in fiscal 2020. Sarvey has also cut the district’s supplies expenses from $1.89 million last year to $1.68 million this year.
While those cuts are being made, expenses will increase in other areas – specifically salaries and benefits for district employees, Sarvey said.
Salary expenses will jump from $12.20 million to $12.72 million while benefit expenses will increase from $4.92 million to $6.06 million. The budget includes approved lane changes and step advancements for certified staff and the addition of $700 to the certified base salary. It also calls for the creation of a salary schedule for classified staff and the addition of 40 cents to the classified base salary. The implementation of a new employee insurance program is also included, Sarvey said.
“I was really taken aback by the number of individuals that got on the new plan or moved from single coverage to family coverage,” Sarvey said during the board meeting. “I think that’s wonderful, but it does come at a cost to the district.”
Together, salaries and benefits make up 84% of the district’s general fund budget in fiscal 2020, Sarvey said.
“I think that would be about the high point we would want,” Sarvey said. “I think we are basically capped out with salaries and benefits for now. For future increases, we will have to look within our budget and make some adjustments.”
As in past years, the district will spend the most money on the operations of Buffalo High School – approximately $4.45 million. The district will also spend $3.21 million on Clear Creek Middle School, $3.01 million for Kaycee School, $2.77 million for Meadowlark Elementary and $2.74 million for Cloud Peak Elementary.
Sarvey has budgeted for $27.93 million in revenue in fiscal 2020, up from $19.38 million the previous year. The increase is due largely to some one-time grants from the state, including a $5.06 million tax shortfall grant offered as a part of the school foundation entitlement program. If the district collects less than the estimated local taxes in a given fiscal year, the state makes up that difference through the tax shortfall grant. This year’s tax shortfall grant makes up 18% of the district’s total revenue, Sarvey said.
In addition, the district will receive a $1.33 million state reimbursement to cover the cost of 11 new school buses bought last year. Under the Diesel Emissions Reduction Act, the State of Wyoming reimburses 75% of the purchase price of the busses and the State Department of Environmental Quality will cover the remaining 25%. The district will receive the 75% reimbursement from the state in 10 separate installments throughout fiscal 2020. The DEQ dollars will be received once the department has determined the district’s previous busses are inoperable.
Thanks to the grants, district revenues exceed expenses this year, Sarvey said. But those one-time funding sources can’t be taken for granted and it makes sense for the district to plan ahead for revenue declines in the future, Sarvey said.
“It is important to note long-term planning must be part of local government management in all economic conditions,” Sarvey wrote. “Continuing tracking of the district’s financial position is essential in order to align the cost of education to available resources.”