NORMAN — The ripple effects of stagnant revenue and tough legislation were reflected in past and projected Norman Public Schools’ budgets, presented Monday evening to the Board of Education.
NPS Chief Financial Officer Brenda Burkett emphasized that her projections and calculations are always “worst-case scenarios” and detailed factors helping and hurting the district’s annual budgets, such as revenue, state legislation and federal funding.
“I said this many times. The reason our district ended last year with such a healthy fund balance wasn’t because of state funding. It was the federal dollars we were receiving,” Burkett said. “Using bond money creatively was also hugely helpful, such as purchasing text books and instructional technology with bond dollars — which is legal. Had they still been out of general fund, we never would have ended with the balance we did.”
Projected revenue for 2012-2013 was $92.6 million. Projected expenditures were $96.6 million, showing a disparity of almost $4 million. The federal dollars, which Burkett said were awarded in 2011, were carried over into Fiscal Year 2012, meaning the district will not have this resource for 2013-2014.
A key reason for the excess of expenditure budget over revenue was the district’s decision to increase teachers’ compensation, making up for lags in previous years due to more dire budget situations.
“Our school employees and staff received minimal compensation increases over the years. With such a strong fund balance and utilizing every resource, we were able to enrich compensation schedules, unlike preceding years,” Burkett said.
Superintendent Joe Siano voiced his appreciation of this measure and the board’s prioritization of NPS faculty and staff.
“The board has always said that when dollars were available for compensation, that would be a priority,” Siano said. “We feel like we have a staff that is some of the best in the state.
“The safer rate would be to hang onto our healthy fund balance, but our employees waited and the budget was healthy enough to make that commitment, and we need to be fair when we say we can.”
NPS’ projected budget showed a similarly concerning deficit between projected revenue and expenditure, with projected revenue at $91.9 million and projected expenditure at $94.9 million, showing a disparity of $3 million.
Prominent factors contributing to this deficit were sequestration, expected to take $374,000 out of the district’s budget, as well as state questions concerning ad valorem taxes approved by voters in 2012.
“There’s a serious concern that that statewide cut in local dollars could cut $70 million out of the state budget’s formula for aid. If and when this happens across the state, the state needs to offset it, but we’ve only been told $20 million will be put into the formula,” Burkett said. “We won’t know until August.”
“The public doesn’t always see how stressed our budget is because we’ve worked very hard to leave dollars where it’s most observable to parents and kids, and that’s in the classroom. If we lost the opportunity to leverage these other resources, you’d see a dramatic jump in class size and drop in services,” Siano said.