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BOE prepares for difficult financial decisions

By Curt Yeomans

cyeomans@news-daily.com

The Clayton County Board of Education has learned the price for unethical and dysfunctional behavior.

School system officials announced $16.3 million of the estimated $23 million the district will lose in state funding next year comes from a significant loss of students to other districts because of a loss of accreditation in August.

The students left Clayton County Public Schools over the summer, after the Southern Association of Colleges and Schools (SACS) stripped the school district of its accreditation. The chief reason for the revocation was largely because of the actions of the previous school board.

"The lesson here is if you don't act accordingly, and in the best interests of the children, then we're all going to suffer," said Jessie Goree, the board's vice chairperson.

Now, board members have to make sure whatever budget they approve for Fiscal Year 2009 takes the reduced funding and the unstable economic situation across the nation into account. At the same time, they have to make sure they do not compromise the quality of education provided to Clayton County children.

The board members, and board members-elect, who will join the body in the coming months, will review the 2009 budget, and other financial data, with district officials at a retreat in early December.

"As a district, we absolutely must maintain a stable financial footing in order to continue offering top-notch instruction in a safe and comfortable school environment," said Superintendent John Thompson. "This means the board will be called upon to make some tough choices in selecting the best path forward."

The school system is offering the board a number of options to cut costs. They range from changing the work year for 12-month employees, to reducing benefits for part-time employees and overtime payments, to decreasing the number of people employed by the district. A decision will have to be made as the school system heads into the spring and the Fiscal Year 2010 budget is put together.

The board was told Monday much of the $23 million state funding loss comes in the form of Full-Time Equivalency (FTE) funding. The FTE funding from the state is being reduced because an enrollment count performed in October revealed a loss of 3,224 students. According to the FTE count, there are 48,595 students left in the district.

Although the system will lose money because of lower enrollment, its expenses should also decline, because fewer students will mean a need for fewer teachers and other resources.

"Hopefully, the situation with the FTE funding will stabilize, although I think we'll lose a few more students as a result of the accreditation loss," said board member Michael King. "However, if we don't get our accreditation back, I personally believe we'll lose about 1,000 students per year, which will create further reductions in [state] funding."

Since the FTE funds are tied to the number of students enrolled in the school system, it will not have the most devastating effect on the district's financial standing. In fact, the state would only reduce the funding to a level that makes sure the district continues to provide a quality education to its students.

But, local tax dollars are a different subject.

Tax funds are the unknown component in terms of identifying the school system's financial situation, and those numbers will not be available until the spring. They are not tied to student flight from the district, except for the fact that many families are moving out of the county because of the accreditation problems.

District officials are still reviewing how much local tax revenue will be lost in the next fiscal year. Chief Financial Officer Roger Reese told the school board on Monday $5 million in tax dollars will be lost when car rental agencies at Hartsfield-Jackson Atlanta International Airport move in late 2009 from Clayton County to a new facility in Fulton County.

Board members suggested several ways to deal with the reduced state funding, and the uncertainty involving property taxes. Goree suggested the board members and school system officials work closely to determine ways to streamline the budget and cut unnecessary costs.

"We don't always have to spend the most money to get the best quality," she said. Goree later added, "We're going to have to make a number of difficult decisions. We're probably going to have to reduce the staff, which I know will upset some people."

King said the approach the board takes to handling the financial situation will depend on what information Reese and Thompson present to the board at their retreat. "We'll have to discuss some of the problems facing the district and hopefully we can all get on the same page about what to do," he said.