San Marcos CISD Trustees President Judy Allen, left, and Superintendent Patty Shafer, right, at Monday night’s school board meeting. Staff photo.
By BILL PETERSON
The San Marcos CISD Board of Trustees kicked off its serious budget deliberations Monday night with a recommendation from the administration to operate at a slight deficit next year while holding the FY 2009-2010 ad valorem tax rate at $1.37 per $100 of taxable value.
Assistant Superintendent Mike Abild told the school board that he would have preferred to present a balanced budget, but indicated that the $301,728 deficit would enable the San Marcos CISD to meet a state mandate calling for each educator (teacher, librarian, counselor, nurse and speech therapist) to receive at least an $800 raise. Indeed, Abild said the budget goes a little beyond that, setting a new minimum salary of $40,000 for beginning teachers in San Marcos CISD, up from $39,200. Abild added that the budget includes minimum pay raises of $1,000 for every experienced educator.
“There was a time in the budget process when I thought that number was going to be a million and a half (dollars),” Abild said, expressing relief that the deficit isn’t as high as he once feared.
Trustees didn’t indicate their views about the budget proposal during Monday night’s workshop. The board will hold a public hearing on Aug. 17 at 6 p.m. with a goal of setting the FY 2010 budget and tax rate on Aug. 18. The board and administration can still tweak the budget and tax rate, which must be set by Sept. 1.
For a number of reasons, no alarm registered in the board room at the San Marcos CISD administrative offices as Abild presented the budget.
For one, the Abild also announced that the district figures to come in $16,129 ahead of budget for the present fiscal year, despite a revenue shortfall of $818,680. Nearly half of that shortfall – $375,000 – results from unmet budget expectations on investment returns, which is a common problem for local governments this year. The district more than made up for the revenue shortfall, reducing expenditures by $834,709. The majority of that cut came in $655,796 of reduced payroll costs.
After budgeting $875,000 in interest earnings for the present fiscal year, the district now expects those earnings to top out at $500,000. But the district is budgeting only $500,000 for interest earnings next year, so a comeback in the financial markets could close the budget gap. Indeed, the administration would present a balanced budget if it assumed the same $875,000 in deposit earnings that it assumed for 2009.
“I guess we could have gone with the $875,000 and hoped for the best,” Abild said.
In addition, the school district holds a fund balance of more than $21 million against an operating budget of barely more than $57 million for FY 2010, so the projected shortfall of $301,728 will not make much of a dent.
House Bill 3646, passed during the last legislative session, requires teacher salary increases of $800 or each teacher’s share of $60 per WADA (Weighted Average Daily Attendance), whichever is higher. When the WADA formula came up with $915 per teacher in San Marcos, the administration decided to ask the board to provide $1,000 raises. HB 3646 also mandates salary step increases, meaning some teachers will be raised even higher. A teacher entering her 24th year, for example, would receive a $2,200 raise under the budget proposal being considered.
Abild mentioned, to the room’s general pleasure, that the San Marcos CISD’s teacher pay scale was higher in every category than the pay scale in Hays CISD last year. Abild added his confidence that such will remain the case under the new pay scale.
The school administration also announced that the San Marcos CISD is, once again, a Chapter 41 school district, which means it counts as property rich. However, San Marcos CISD isn’t so property rich that it has to make Robin Hood payments that are spread around the state for equalization purposes.
To qualify as property rich, a school district must have $319,500 of property value for each student. Abild said San Marcos CISD should come in around $361,000 of property value per student in FY 2010. However, Robin Hood payments aren’t required unless a school district has $476,500 of property value per student, or it raises its property tax rate on the Maintenance and Operations (M&O) side above $1.06. The San Marcos CISD is holding its M&O rate at $1.04.
As he ran through the budget, Abild expressed concern that the school district will continue to struggle at raising teacher pay without dipping into fund reserves. However, he said, the district could soon find a way.
Abild said the school district’s debt service will decrease by $640,000 in FY 2011, adding that the decrease would allow a reduction of two cents on the Interest and Sinking (I&S) rate, which stands to remain at 33 cents in FY 2010. Abild said the board could consider reducing that debt service tax rate to 31 cents in FY 2011, then increasing the M&O side to $1.06. At $1.06, the district could bring in that much more money for operations without having to kick in for Robin Hood.
The overall proposed budget for the San Marcos CISD in 2009-2010 comes to $71,145,601, of which $57,045,650 is for operations, $10,685,239 would cover debt service and $3,414,712 would cover child nutrition programs.