School, county budgets intertwine this week
While Shelby County’s municipalities are trying to balance budgets in the wake of decreased assessment values, the county commissioners and unified school board members are facing budget issues of their own.
The unified school district board members received a draft of the 2013-2014 school year budget earlier this week. They’ll meet several times this week to discuss Superintendent Dorsey Hopson’s projected $36-million gap in the general fund balance and vote at 1 p.m. Thursday on whether or not they should pass the budget.
But how they close that budget may not be determined until after it’s passed. That’s when county commissioners will decide on how much they might have to raise taxes to help fund the newly merged district -- if even for only one year. The commissioners were scheduled to continue their budget talks this week.
Suburban school board member David Reaves said he’s read the district’s proposed budget and believes it’s one he can support.
“They did a yeoman's job of combining the needs of Shelby County and the City of Memphis,” Reaves said. “I hate that we had to go through and make some of the decisions that we did, but I think this is the best possible result.”
Reaves said that some of the cuts that the district originally feared were spared, such as those in academics except in instances where there were too few programs in a school to justify them.
He also said that nearly 80 percent of the budget goes toward personnel expenses: about 60 percent of that in salaries and another 20 percent in benefits. That made it harder to keep balanced, because cutting more expenditures likely would have meant cutting more staff.
Meanwhile, he said the board is looking toward the county to help make up some of the shortfall in revenues.
The county itself is not in great shape. Commissioners have been discussing a budget with a potential $0.33 increase in the tax rate because of declining property values. Otherwise, the county could be looking at $52 million in lost revenue.
But this week, Shelby County Mayor Mark Luttrell Jr. said he believes that number will fall to about $0.30 by the time the budget is adopted.
“You hate to raise taxes at all,” Luttrell said. “We would prefer not to have any tax increase.”
However, when looking at services, the county has a huge public safety and public health commitment, he said. That, plus the decreased value in 2013 property assessment values and the needs of the unified school district, means that rates likely will rise for county residents in the 2013-2014 fiscal year.
The county mayor was to meet with county commissioners Wednesday morning for a formal budget presentation. Still, the budget cannot be finalized until the school district passes its budget.
“We have to wait and see from the school board before we can get an accurate picture,” Luttrell said.
Meanwhile, commissioners are somewhat split on the issue. Chairman Mike Ritz said he supports some funding for the schools, but doesn’t think the county will have the two-thirds majority it would need to give more than 9.9 percent increase to the school district over last year.
“As chairman, I don’t want to get in the way of the school board putting forward their best plan,” said Ritz. “I’ve been in touch with (superintendent) Hopson several times, and I think the proposal he’s made is a rational request.”
But Commissioner Terry Roland said he won’t support any more money to the school district.
“I’m not going to support a tax rate increase nor am I going to support a tax increase,” said Roland. “State law says all we have to give the school is what we gave them last year.”
Roland said the district already gave the school district millions toward a new information technology system, and the district has fewer kids and fewer schools than it did just last year. He said with property assessments down, the school needs to find a way to cut its budget or come up with other funding sources.
“I’m not going to give them another dime,” he said.
But Ritz said he believes there are seven to eight votes from county commissioners to raise the funding level, and that’s enough to give the district an additional $12 million, maximum, for 2013-2014.
“I’m encouraging the commissioners to listen to the (school district) administration,” said Ritz.
Reaves said he believes that will require asking the county for $10 million more in funding than the district received last year. But, with the district’s lower staffing numbers this year, the municipal school districts will be starting with less overhead and can go up from there, he said.
“It will make their starting numbers look a lot better,” Reaves said.