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City schools at least $1.7 million short for next fiscal year

More work to do to cut spending, finance chief says

POSTED: May 17, 2008 5:00 a.m.


Though still early in the Gainesville school system budgeting process, the projected spending for fiscal year 2008-09 exceeds the income by $3.3 million.

Janet Allison, finance chief for the district, told the City Board of Education Monday night that expenses are estimated at $52.9 million and revenues at $49.6 million.

Applying a nearly $1.6 million midyear adjustment from the state, or the same amount the system received this year, the difference between expenses and revenues could be whittled to about $1.7 million.

The board, however, has not budgeted the midyear adjustment in past years, instead letting that amount serve as a midyear windfall from the state, Allison said.

"What we’re trying to do is go back and cut some more (expenses) ... and then we’ll come back from that point and let you know where we’ve landed," she told the board.

"So we’re $1.7 million in the red?" asked board member Kelvin Simmons.

"No. ... If we adopted the budget tonight, just like it is, which basically (is) if we can’t cut $1.7 million, we’re probably going to have to increase the (tax) rate," she replied.

Sammy Smith, the board’s chairman for May, said to Allison, "You’d have to recommend a millage rate increase."

The school board gives the final OK to the fiscal budget, which runs from July 1 to June 30, and sets tax rates. The 2008-09 fiscal year begins July 1.

"We have quite a bit more work to do before we get to a point where we have a budget that we feel like we can recommend to you," Allison said.

The board’s budget calendar calls for adopting a tentative 2008-09 budget May 19 and a final budget on June 16.

Public hearings are set for 10 a.m. May 28 at New Holland Core Knowledge Academy and 6 p.m. May 29 at Gainesville High School.

As part of her presentation, Allison noted that a 1-mill increase in the tax rate could generate nearly $3.4 million in additional revenue.

The city system’s tax rate is 6.96 mills, with 1 mill equal to $1 for each $1,000 in property value. With a 1-mill increase, the property tax bill would increase $100 for each $100,000 in property value.

A slowing economy appears to be part of the reason for the budget woes.

The city is collecting 95 percent of property taxes this year. The normal rate is 97 to 98 percent, Allison said.

Smith asked Allison to bring property-tax revenue estimates based on collection rates of 90 and 92.5 percent.

Making matters worse, school officials have talked about taking out a short-term loan to make ends meet in this year’s budget, which ends June 30.

Allison has said that the district could end the fiscal year with expenses exceeding revenue. She has declined to give an amount, saying that the final amount hinges on "getting payroll coding issues cleared up."

On a bright note, the school board voted Monday night to contract with Energy Education Inc. to help the system with an energy conservation program that could save the system $3.3 million over 10 years. The program takes effect July 1.


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