By CHRIS WILSON
At a public hearing last Thursday night, the Amory School Board looked over a proposed $14.363 million budget for fiscal year 2007.
The budget contains an increase of $57,153 over last year’s budget which will call for an increase in millage rates for Amory taxpayers.
District Financial Officer Kathy Cadden summarized the budget for the board members, explaining that the district will be seeking an increase in ad valorem monies of slightly less than 4 percent. The state cap for ad valorem increases is 4 percent. Above 4 percent would require an election to be held to allow voters to decide on the increased taxes.
The city of Amory is responsible for setting the millage rate that will generate the amount of money the school district is requesting. Millage rates are determined based on assessed valuation figures supplied by the county tax assessor’s office.
It is anticipated that 10.9 percent of the proposed budget, or $1.561 million will be generated through ad valorem taxes this year.
Since the school district does not set the millage rate, the city does, school officials can only guess at what the millage rate will be. However, based on the assessed valuation being over $60 million, Cadden said it is possible there may not need to be an increase in millage rates this year at all, or perhaps a very small increase. This will be the first year that the city has Gilmore Memorial Regional Medical Center on the tax rolls since its sale to HMA which should benefit the schools.
The state cap for millage rates for schools is 55 mills.
An increase in ad valorem taxes will see taxes on homes, automobile tags, utilities, business fixtures and equipment and rental real property rise.
The biggest problem for school officials to contend with in setting their budget for 2007 was the fact that the state legislature did not authorize full funding for the Mississippi Adequate Education Program (MAEP).
Cadden said Amory’s MAEP funding level for 2007 was supposed to have been $8.256 million, but the district will receive only $7.793 million, a cut of $462,191. She said Hurricane Katrina and other damaging storms last year have had a serious impact on the state’s schools and monies for school districts.
In budgeting this year, this is the first year since FY2002 that the district was not required to give state-mandated teacher pay raises. For five years the teachers received salary raises averaging about 8 percent each year.
Teachers will still receive increases in pay based on years experience and education, but these raises max out at 25 years of experience.
This year the employer retirement contribution percentage rate is increasing from 10.75 percent to 11.30 percent. This will amount to an increase of about $3,300 for the district, but the state is fully paying the increase.
The state also will pick up the tab for an increase in state health insurance for covered employees. This amounts to about $6,800 more per month.
Salaries for personnel and fringe benefits accounts for about 72 percent of the district’s entire budget.
Transportation costs the district about 4 percent of its annual budget. With prices on gasoline skyrocketing, budgeting for transportation is an uncertainty. During the past school year diesel fuel increased by over $1 a gallon, impacting the budget. Cadden said the district has budgeted $29,000 more for fuel itself this year over last year. Because the district’s fleet of buses is newer now, they are hoping to benefit with fewer repair costs in the transportation budget.
The district is planning to purchase two new buses this year, one being funded with state money and the second with special education funds.
About 3 percent of the district’s budget will go for utilities — natural gas, water, electric and phone service. The principals have been working hard to save money on utilities at their buildings. Some of the measures taken last year are beginning to pay off with significant savings, Cadden said.
A bright spot in the district’s budget is a decrease in general liability insurance costs. For the second year in a row the district will experience a decrease in premiums, with a drop of $5,974 this year over last year’s. The decrease in costs is attributed to the district having few insurance claims and it has shopped around for a good price on insurance. The district this year has added flood insurance to its policy at the high school, based on new flood plain maps for the area.
The district will continue to receive E-Rate funds for technology this year. Last year it received $42,000. It is used to pay the salary for a technology person.
Cadden reported that the district continues to be fortunate to receive good support from local foundations in the way of grants. In the past year, the Quality Education Foundation and the Gilmore Foundation have contributed significant amounts of money to the district. The district also has been fortunate to receive several federal and state grants that have helped fund various programs.
“We want to take advantage of even more grant opportunities this year,” Cadden said.
The district is also to receive $28,000 for the first quarter for a Medicaid reimbursement program it has begun to participate in. Cadden said the amount of money from this has been a surprise to the district. “It’s like free money for us,” Cadden explained. “It’s an ongoing program.” She said about 50 of the state’s school district’s are participating in the program that requires training for staff that files reports. Cadden said the money can be used for various purposes as outlined by the government. One option is to use it for a teacher’s salary.
The district still has two bond issues that it is paying on. A general obligation bond that was issued in 1994 for remodeling West Amory Elementary and for new classrooms at East Amory Elementary and a new band hall at the middle school and new science labs and media center at the high school will be paid off in September of 2009.
The district is also still paying on a MAEP state bond that was issued in 1998 for new classrooms, cafeteria and band hall at the high school. This bond issue will be paid off in February of 2018.
The district maintains a contingency fund, a required by law, for unexpected expenses. Amory’s fund balance for 2007 will be about $495,000.
Superintendent Jim Sappington pointed out to the board that the district has a lot of expenses “looming in the future” especially in terms of its facilities.
He said he felt good about this year’s budget, though. “I think we’ve been good stewards of the taxpayers’ money.”
Cadden said Amory’s percentage of ad valorem support, under 11 percent, is very low compared to many districts which rely on up to 30 percent of local funding. “Ours is one of the lowest in the state,” she said. She said the district also has one of the lowest administrative costs around.
The school board will meet again on Thursday, July 20, at 11:30 a.m. to give final approval to the FY 2007 budget.