The Norman Transcript

Columns

August 30, 2012

Carryover funds necessary for districts

NORMAN — During the most recent State Board of Education meeting, state Rep. Jason Nelson criticized schools for claiming financial hardship when they had “hefty” balances from the previous school year.

Board members appeared surprised that schools would have $670 million in carryover, according to the lawmaker, and thanked him for his research.

Nelson is likely one of many state officials who do not understand the nature and necessity of carryover funding — and especially since the 2008 recession — or why carryover is at its highest the first month of a school year.

Norman Public Schools’ carryover funds represent approximately one month of the district’s operational expenses. One month’s worth of salaries, utilities, fuel, school meal costs, etc. Statewide, it may all add up to a headline-grabbing number, but it’s still a fraction of an entire year’s budget.

Carryover is the highest at the beginning of the year, balances are limited by law, and often a large percentage of carryover is committed for expenses for which districts are expecting invoices. By the end of this school year, NPS’ carryover will be less than one month’s operational expenses because our state funding has again unexpectedly been reduced.

School districts across Oklahoma have had to employ several strategies since the state began cutting their funding. Funds have been reduced on more than one occasion at mid-year or after employee contracts were in place. As unforeseen cuts in revenue have occurred one after the other, the necessity for a reserve fund has become even more crucial to operational stability.

State funding has been cut several times since 2008. For NPS, it totals approximately $4 million. Examples of how cuts are often unexpected include: Notice three weeks before the school year began that our revenue would be $1 million less (although our enrollment increased), a new state regulation that eliminated $250,000 from our special education programs mid-year, delayed local ad valorem collections and unfunded mandates like the recently adopted teacher evaluation system that will cost NPS about three times the funds provided by the state.

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