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The Vandalia Board of Education on Tuesday passed a budget for the current school year that shows a $1.58-million deficit in the four operating accounts over which the board has spending control.
And even though the district still has a balance of $3.82 million in the bank to help it bridge the funding gaps, the state requires any districts in a deficit spending situation to develop a “deficit-reduction plan” to work its way out of the shortfall.
“We’ve worked hard to do the right things and to be financially responsible,” said Superintendent Rich Well. “The state is demanding more of us, yet they’re giving us less money. They’re making state mandates and not funding those mandates.”
Well told the board on Tuesday that a $756,640-decrease in general state aid is the main reason the budget shows a deficit. That decrease in state funding is due to a drop in the average daily attendance in the district and a reduction in state aid payments.
The district has been fighting late or missing state payments for the past several years.
In the deficit reduction plan, the district will be required to make reductions of $530,000 in each of the next three fiscal years.
Well said that the district is committed not to borrow funds to make up the difference, and warned that expenditures will be reduced by “loss of staff and reduction in force.”
That, he said, will impact the educational programs that the district will be able to offer.
Overall, the budget adopted by the board shows operating fund revenues of $12,952,565 and expenditures of $14,534,801, which results in a deficit of $1,582,236.
“It’s disappointing,” Well said after the meeting, “because we as a community, staff, administrators and board have done a very good job being prudent with our money. Then the state doesn’t follow through on its commitments. They just tell us to ‘live with it.’”
During the meeting, School Board President Jay Carroll said that the situation isn’t due to anything the board did.
“It’s not that we’ve overspent,” Carroll said. “It’s a revenue problem. Slowly, the revenues have been whittled away.
“And then, last spring, we weren’t told early enough that state funding cuts were coming, and we were already past the date that we could make cuts for this current year.”
He said that if the district is planning to make cuts in personnel, it must make those reductions no later than the March school board meeting.
Well noted that the Vandalia district is not alone in feeling the financial pinch.
“The reality is that a lot of rural counties like us are in the same position,” Well said.
“The rural counties, like us, depend more on state aid than the (Chicago) collar counties do.”
For instance, the Vandalia district’s funding comes from three sources: local (35 percent), state (55 percent) and federal (10 percent).
Well said that some of the wealthy Chicago districts receive only about 5 percent of their funding from the state (and a much-higher percentage from local property taxes), so cuts in state aid don’t affect them so significantly.
“This is the tightest budget we’ve put together,” Well said. “We’ve cut as much as possible to get where we are. And we’re not even close to meeting the state criteria.
“That’s why we’re being required to do the deficit reduction plan.”
Of the district’s expenditures, approximately 70 percent ($8,965,774) is for salaries and another 13.5 percent ($1,733,981) is for benefits.
Supplies account for the next largest category, but that is only 8 percent ($1,044,465).
Well noted that in most years, the district purchases at least one school bus to keep its fleet updated. This year, that purchase will be deferred.
“That’s not a long-term fix,” he said. “We will have to figure out how to buy buses in the future.”
In other business, Well noted that this is homecoming week in Vandalia.
Because of the extra activities, Friday’s football game will start at 6:30 p.m. rather than the traditional time of 7 p.m. The coronation of this year’s king and queen will take place during halftime, and a dance will follow the game.
Well said that the district enrollment is up slightly from last year, with a total of 1,574 students.
The board met for 10 minutes in executive session to discuss personnel and collective bargaining issues. The district still doesn’t have a contract with its teacher’s union, and has had one arbitration meeting.
A second meeting is planned in October.
The board also:
• Approved bids for oil (Knapp Oil Co. of Patoka, $1,371) and tires (South Central FS, $23,992).
• Approved a joint agreement resolution with the Okaw Area Vocational Center.
• Approved the district substitute staff list.
• Approved the resignations of Emma Sue Rabe and Jennifer Knebel from the “Just Say No” program.
• Approved the sale of this year’s OAVC building trades house for $157,000.