By Lena Mitchell/NEMS Daily Journal
CORINTH – When two new school board members take office in January, they will find a much healthier financial outlook than the Alcorn County district faced only three years ago.
Despite having to absorb a third fiscal year of state budget cuts in the Mississippi Adequate Education Program – this year at 10 percent – with perhaps more to come later this school year, the district’s fund balance is at a higher level than it has been in several years, said Business Manager Angi Wilhite.
The school board heard the district financial report before approving what district officials hope will be a final renewal of a $3.5 million tax anticipation loan to help the district’s cash flow through 2011.
“As of June 30, our fund balance was $3.4 million,” Wilhite said. “The state superintendent has told us that by August we should expect another 10 percent cut from MAEP in addition to the 10 percent we’ve already been cut this year, which is essentially a 20 percent cut for us. We need the loan to be able to pay our accounts payable and payroll from August to December 2011 when tax collections are really low.”
The district’s monthly payroll is almost $2 million, said Superintendent Stacy Suggs. The state requires a reserve of at least 7 percent – but prefers the fund balance to be 10-15 percent of total budget.
“We’ve almost got enough in reserves to carry us in the lean months, but we’re still worried about possible further cuts,” Suggs said. “We hope this tax anticipation note is the last one.”
The district’s budget is about $32 million, so a fund balance that Suggs and Wilhite say they would be comfortable with is $4 million, about 12.5 percent.
“Until we have that, I would be worried about our payroll and payables every month,” Wilhite said.
The district has faced an uphill struggle financially since a $420,000 budget shortfall came to light in early 2008, soon after Suggs took office.
With assistance from financial consultant Margaret Dennie, the district and school board mapped out a strategy to bring the district back into solvency.
Their plan was thrown into disarray when Gov. Haley Barbour announced in late 2008 that he was implementing the first of several cuts to each school district’s funding. In the spring of 2009 the district was cut by about $650,000, when it had started the fiscal year with only $319,000 in its reserves. Two more cuts in MAEP funding during the 2009-2010 fiscal year cut Alcorn County schools more than $3 million more.
The district has responded by levying the maximum allowed in its annual tax increase request of 4 percent.
Officials also have made some difficult personnel decisions, including not replacing staff who retired or resigned at the end of the 2009-2010 school year, not renewing contracts for six teachers, nine assistant teachers and four custodians, and instituting three days of furloughs on non-instructional days spread through the 2010-2011 school year.
“We’re being real tight with money, but the kids are not going without things they need,” Suggs said.
Contact Lena Mitchell at (662) 287-9822 or email@example.com.