WOODFORD -- With a significant unassigned fund balance at its fingertips, the Woodford School District board is in a unique situation as they prepare a fiscal year 2014 budget.
Just before the end of last fiscal year the district received about $200,000 in impact aid from the federal government for its national forest land -- more than twice what the district expected. The board had to apply all of the money to its fiscal 2012 budget upon receipt, which accounted for the majority of the district's $126,000 fund balance at the end of the fiscal year.
The school board now has the decision of how much of the fund balance it would like to apply to next year's budget as revenue to offset taxes and how much it would like to tuck away in a capital improvement reserve fund.
The fund balance couldn't come at a better time as a projected loss of federal funds next year in addition to a declining enrollment and other factors would have the district facing a 19-cent tax rate increase if none of the fund balance is used, according to projections from the first budget draft presented Monday. A 19-cent rate increase would mean a resident who owns a $100,000 home would be required to pay an additional $190 in taxes next year.
Southwest Vermont Supervisory Union Chief Financial Officer Richard Pembroke told the board if it wished to offset the entire increase in tax rate it could apply $60,000 of the fund balance as revenue, which would actually reduce the district's tax rate 3 cents next year. If the board then carried another $30,000 of the fund balance forward as a contingency it would still have $36,000 remaining that voters could be asked to place into the reserve fund.
"You guys are in a uniquely beneficial position to be able to determine, depending on how much you want to reserve and how much you want to use of that fund balance, to affect the tax rate," Pembroke told the board.
The board did not discuss at length how much of the fund balance it would like to use to offset taxes on Monday when the school board reviewed a draft budget for the first time. Instead, Chairman Mark Tilley said he would like a week to review the budget draft and consider the fund balance in greater depth and then have the board make recommendations at its next budget meeting.
The first draft of the budget itself is up $18,000, or 3.8 percent, to $493,000. Most of the increase is due to inflationary growth and salary and benefit increases. Woodford teachers, who are not part of the collective bargaining agreement other teachers in the other Southwest Vermont Supervisory Union schools are, were give a 3 percent salary increase in the first draft, which accounts for an $3,700 increase. The board went into executive session to discuss salaries after open session but did not make a motion afterwards. Health insurance increases amount to $7,400 of the increase.
The district is also seeing a $4,100 increase to pay its share of the SVSU technology department costs, which is due to a new way in which technology personnel are funded.
The budget also included $10,000 for startup costs for a public-private pre-kindergarten partnership to begin next school year, which the board later cut to $5,000 in hopes of receiving a grant to help defray costs. Beginning pre-K is not definite at this point, but if the district does move forward with it and needs more money than budgeted it will be able to pull money from a reserve fund to cover the expense.
Helping the district is a $9,500 decrease in special education expenses and savings of greater than $2,000 for both auditing services and liability insurance.