Schools lose $1.8 million
Gov. Bob Riley’s proration announcement on Monday came as no surprise to state or local educators.
Shocking, however, was Gov. Riley’s numbers: nearly $800 million – or 12.5 percent – slashed from the Education Trust Fund, the main funding source for the majority of public schools in Alabama.
For Superintendent Mike Looney and the Butler County Board of Education that means a cut of $1.8 million from this fiscal year’s budget.
All of the school system’s expenses are going to be examined, said Looney.
“We are going to examine every single account, every single expense and we’re going to begin to formulate a plan to recommend to the board to make some tough choices,” he said. “We’re not in the position to float along like we have been.”
The school system currently has approximately $2.5 million in reserve funds, said Looney. The board has already had to remove funds from the reserve account twice this year to meet an employee payroll deficit from the state. That money has been repaid, but dipping into those reserves to offset proration’s impact would hurt the district in the long run.
“If we go into the next fiscal year with no reserve fund that would spell disaster for us,” he said. “We’re going to look at everything from who’s driving cars and what they’re driving them for, to leave requests for professional development to how we use utilities. Unfortunately, electricity is a major expense for our board. An example is at Greenville High School, the electric bill is $15,000 per month. There are some savings to be had. This is going to make us look at those expenses and see how we can cut those expenses. There is no sacred cow in these times. This is an unprecedented time.”
Proration is the process of reducing spending when expected revenues fall short.
Gov. Riley plans to use an immediate withdrawal of $218 million from the Rainy Day Account to reduce proration to nine percent.
The governor had $437 million available from the account, but chose to use only half of that amount at this time.
“The second half of the Rainy Day Fund will be distributed during the remainder of the fiscal year,” said Gov. Riley. “Based on all the economic forecasts I have, I believe this is the wisest course of action. Doing this allows us to responsibly manage the disbursement of the Rainy Day Fund and also meet the needs of our schools.”
Looney was hoping all of the rainy day account would be utilized.
With all of those funds in play, educators would have some leeway in determining how much state funding is actually affected, he said.
“They’re only using half of it which absolutely stuns me,” said Looney. “This is huge. I can’t sit here and tell you what exactly is going to be cut, but we’re going to take a pencil to everything. We will examine programs, we will examine staff, we will examine transportation, and we will examine everything.”
The effects are going to be immediate, said Looney.
Money for textbooks, professional development for teachers, library enhancements, and technology are about to take a big hit, he said.
“We can say we want to insulate the classroom and we absolutely want to,” he said. “But the fact is that most of the money in the school district is spent in the classroom and there’s no way for the students not to be affected.”
Schools will not lose teachers, though, said Looney.
The board is under contract with all teachers until May.
But many economists predict budget shortfalls could be worse next year.
“I would be shortsighted if I didn’t envision larger class sizes,” said Looney.
School construction funds are earmarked especially for that, according to Looney, who said projects such as the new Butler County Magnet School would proceed as planned.
The K-12 facility in Georgiana is scheduled to be open next school year.