Rangely School Board eyes budget and reserve

RANGELY I The Rangely School Board met Jan. 5 for a work session in which the board members began preliminary discussions about the 2016/17 school-year budget, specifically how much to spend out of reserve funds and where to make cuts.

At the start of the meeting, Rangely School Superintendent Matt Scoggins laid out the goals that guided his development of the potential budget. The goals included staying fiscally sound, maintaining current programs, the potential of adding programs such as full-day kindergarten and staying conservatively budgeted and conservatively spent.
“We don’t go into it expecting to spend every last penny,” Scoggins told the board.
With the goals established, Scoggins presented the board with what he termed a “philosophical question” of how much money is a reasonable amount to be held in fund balance (reserve funds)?
As of June 30, 2015, the balance in this fund was $3,246,833.
Scoggins said the state recommends districts keep 4 percent of total annual expenditures, which would equate to $207,299.76 for Rangely.
Douglas County School District keeps a reserve balance of 5 percent of annual expenditures, which would equate to $259,037.20 locally, while the state of California requires districts to keep the equivalent of two months expenses, which would equal $863,457.33 for Rangely.
Scoggins said that after much discussion with District Finance Director Steve Kraft, he felt comfortable with saying the district needed to keep a minimum of $1 million on hand in order to pay all bills while awaiting state reimbursements.
After discussing fund balance preferences, Scoggins went on to inform the board that he would like to use $924,956.00 of the available fund over the next six years, leaving the fund with an estimated balance of $2,321,876.36 in year 2021.
“That still leaves us more money in fund reserves than when I started,” he said.
The potential fund balance was developed using a number of major assumptions on Scoggins’ part.
First was the assumption that per-student funding received from the state would stay level through 2017 and then increase by 2 percent each year after.
Several board members expressed doubt that the district would see increased funds from the state. Scoggins also included in the calculations that the district would receive a small increase in total students each year, effectively increasing funds.
It was assumed that after sunsetting in 2017, the joint mill levy with the Recreation District, which provides an average $172,000 per year, would be renewed by voters, while the district would see a loss of approximately $30,000 per year from the end of the Bond Fund in 2020.
Other revenues were assumed to be stable. Worked into the plan was a new increased-salary schedule, estimated to cost the district $200,000, and a projected annual salary and wage increase of 2.3 percent and health benefit cost increase of 4 percent.
Other changes that could directly impact students and teachers include a reduction in classroom supply budgets from $1,250 per year to $750 and the addition of full-day kindergarten.
The board also discussed the possible reduction of an English language arts position at the junior/senior high school, which currently employs four teachers in that department.
At the mention of the cut position, board member Annette Webber raised concerns about the potential for students not receiving needed help if the position was cut.
Scoggins agreed that it was a concern saying, “We know from our scores that we have somewhat of an emergency in English and math.”
Additionally, the district is considering cutting the district mechanic position and, instead, is outsourcing the work.
After presenting the assumptions and potential changes to the budget, board President Kurt Douglas told the board, “All of this is really dependent on the (recreation district) mill levy passing again.”
During the discussion, a concerned parent in attendance asked the board about the potential of cutting athletics and activities (which are direct beneficiaries of the mill levy) should the mill levy fail, instead of only discussing cuts only to academic positions.
A clear response was not given.
Scoggins concluded the meeting, telling the board that he felt the proposal and been thoroughly vetted and was ready for serious consideration.
The board will meet again on Jan. 19 for a regular meeting, when they expect to vote on the proposed changes to the certified staff salary schedule.