School budget reserves dwindle

As Oak Harbor school officials fine tune their 2005-2006 budget, they discovered a miscalculation that added nearly $1 million worth of expenses to the latest budget document.

More than $700,000 of the $989,000 in additional employee costs needed to be added into the $43 million budget. The additional costs stem from an initial miscalculation that officials had to correct.

School officials are looking at using budget reserves to cover the additional costs. By doing that, the districts budget reserves will drop below 3 percent. The school district’s goal is to maintain a budget reserve that is between 3 percent and 5 percent of its budget.

Rick Schulte, Oak Harbor School District superintendent, said during Monday’s school board meeting that the school district can’t undertake any new expenses unless something is cut to offset increases.

To help improve dwindling budget reserves, school officials are holding off on contingency items such as technology purchases and making reductions to building budgets.

The reductions would bring the budget reserve above the 3 percent threshold, but that is still considered low.

“This ending fund balance is tighter than I think it should be,” Schulte said.

As officials finalize next year’s budget, they will have several uncertainties that won’t be resolved until after the district’s budget is approved. School districts are required to have a budget approved by the end of August.

The school district is projecting that 5,450 students will attend school during the upcoming school year. That number is 50 students more than earlier projections. The adjusted number helps account for families that are part of the transfer of VQ-2 from Spain to the Whidbey Navy base. Schulte said, however, the school district won’t know the effect on enrollment for certain until the end of the school year.

“Frankly, that is pretty much a guess,” Schulte said. To accommodate the uncertain enrollment projections, he said some open teaching positions will remain vacant until enrollment numbers are known.

Another big question mark for school officials lies with federal Impact Aid projections. The school district is budgeting to receive $5.45 million in Impact Aid payments. School districts that are impacted by military bases, reservations and low income housing are eligible to receive the federal dollars.

Schulte said the House, Senateand President have different amounts projected for Impact Aid. He said the district is averaging out the proposals to estimate the amount to be received next year.

He said the actual amount could be between $500,000 higher or $500,000 lower than the projected amount.

He said that the current budget isn’t sustainable in the long term. To improve the budget situation, officials may have to make cuts or find new revenue in the future.

Officials have only talked about solutions in general terms. Schulte said that if enrollment numbers and Impact Aid come in higher than projected, than then district’s budget situation will improve.

During the meeting, Oak Harbor resident Scott Hornung suggested that school officials look at reducing the number of employees. He pointed out that there were approximately 100 fewer employees working in Oak Harbor schools in 1989 while there were approximately 5,500 students enrolled.

Schulte replied that additional employee salaries are funded through voter-approved initiatives such as I-728, and the maintenance and operation levy. Those additional employees help reduce class size, operate a hot lunch program and increase class time in schools.

The Oak Harbor School Board is scheduled to and approve the budget during its Aug. 29 meeting.

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