Board OKs $42.2M school budget
June 29, 2011 - A 6-0 vote was all that was needed for Oxford Community School to pass the proposed $42.2 million dollar budget for the 2011-12 school year.
Assistant Superintendent of Business and Operations Tim Loock informed the board at the Board of Education meeting on Monday, June 20 this was the "first time in many years the Legislature has enacted a school aid bill prior to the end of the fiscal year," meaning the district would be facing proposed cuts of $470 per student.
"We did know what funding level we were dealing with before the start of our new year, so we didn't have to take a guess at what we thought the funding level per student would be, then months later once the school year started, have to make a change in the budget because of something different than what we assumed," Loock said.
Loock is assuming a $2,184,687 revenue loss from cuts to the foundation allowance.
Budget recommendations call for the district to have total expenditures of $42,214,013 while generating $40,776,458 worth of revenue and having nearly $6,549,415 in the schools fund balance, bringing total revenue funds to $47,325,873.
The district will be allocating $1,437,556 from the fund balance to help balance the budget.
Loock is budgeting for $4,115,360 in local revenue, $32,730,379 in state revenue, $1,873,016 in federal revenue and $2,057,703 in other sources of income, mainly special education.
However, $1,575,605 will be lost from the revenue stream due to the elimination of remaining ARRA and EduJob Funds.
He also assumes a 3.65 percent ($34,558,510) reduction in taxable values from homestead and non-homestead properties in Dryden, Hadley, Metamora, Addison Twp., Leonard, Brandon, Oxford Twp. and the Village of Oxford.
During the meeting, the Board also voted 6-0 to keep the non-homestead property tax rate at 17.9946.
In a change from previous years, Loock is also assuming an 100 pupil increase from the February count, totaling $637,762.
Previously the budget would assume zero growth in student population.
"We looked at what has been our track record for the last several years in terms of fall enrollment and we have a pretty good data source now for enrollments already for the coming school year," Loock said.
"Last year we created a centralized enrollment system, so we are doing a much better job tracking potentially enrolled students," he added. "Based on that information, we feel confident we should see at least 100 new students in the fall, and hopefully more."
In addition to assuming student growth, the district will also be receiving two one-time payments of $479,060 from the "Best Practices" compliance, and $421,573 from the Michigan Public Schools Employee Retirement System to offset a 3.8 percentage point increase in the district's retirement cost.
"Because of the dramatic increase in the retirement rate, they are providing a one-time payment to help out that big increase in the retirement cost, based on enrollment," Loock said.
Last year, the retirement rate was 20.66 percent; this year the rate jumped to 24.46 percent.
"A lot of people are retiring and the stock market, where the retirement assets have been invested, has had some rough years...and with the stock market results not being to good, particularly, if you go back five years to 2008-2009...it creates the need to increase the rate significantly, both the current year and next year," Loock said.
Loock indicated the retirement rate should increase by nearly three percentage points for the 2012-2013 year.
Other expenditures affecting the budget include a 2.4 percent net increase in the salary and benefits budget, totalling $787,561, a 9.5 percent reduction ($361,117) in purchased services related to international baccalaureate (IB) training and an eight percent reduction ($252,494) in supplies and textbooks relating to IB training.
The reduction in IB training is due to most of the staff completing their training in one year instead of two.
Only $65,000 will be allocated for training and professional development for the coming year.
The district is also assuming a 20 percent employee health care contribution, which could become a requirement of all state employees if state legislators approves it.
Loock indicates the district's health care costs would be reduced by nearly $950,000.
Included in the expenditure list is the introduction of two security officers at Oxford High School, and a security officer and a dean of students at Oxford Middle School.
The total cost for the four positions is $100,000.
Superintendent Dr. William Skilling said the district hired three retired police officers to serve as security for OHS and OMS because they would provide more coverage for the same amount of money as one liaison officer from the Oakland County Sheriff's Department.
Skilling added it would have cost the district $100,000 for one liaison officer.
"At the end of the day, we are spending the same money, but rather than having one person, we are now having four people for the same cost," he said.
Skilling said with OHS being as the size it is, he felt it was more than one person could cover, so the district budgeted for two security officers at the high school.
OMS would only receive one officer.
"We felt we needed more coverage (at the high school), particularly at the start and end of the day because at that level, you have students that drive to school, whereas at the middle school, students get bussed in or dropped off and picked up by their parents," Skilling said.
However, the security officers would not have any arresting power, so if an incident does occur, the Oakland County Sheriff's would still be called.
The middle school will also be adding a dean of students, whose sole focus is to help manage students. According to Skilling, the dean will handle the discipline of students, communicate with parents along with other various student management roles.
The district also saw a 20 percent reduction in the PA 18 revenues ($490,185), a county wide millage levied through the Oakland County Intermediate School District for special education.
"Practically their entire budget is driven by taxable revenues, and because of the taxable value reductions that have occurred, those lower values are starting to significantly impact the amount of projected tax revenue to be collected by that county millage," Loock said.
According to the budget, Skilling is set to make $150,500 in salary. The district will pay, on the behalf of Skilling, $18,303 for health care premiums, $1,276.44 for dental, $283.92 for vision, $531.36 for term life insurance and $1,010.16 for long-term disability.
Skilling will also receive an $8,400 car/mileage allowance.
Last year, Skilling's salary was $145,000 after taking a $5,000 reduction in salary.
"Essentially, that $5,000 increase is putting back what he gave this year,: Loock said.
The district will contribute $38,288 to the state's employee retirement fund and will also pay $11,956 for Social Security and Medicare Tax (FICA).
Loock said the FICA number is larger than what the district will actually pay since there is a cap on FICA.
Loock indicated one area not calculated into both revenue and expenditures is the International Residency Academy and the Virtual High School due to lack of sufficient information. The information is expected to be put into the budget in the fall.
"We don't have enough information yet to know how many student FTE's we are going to get out of those, what expenses might be needed to operate those," he said. "Once we get better information on that, we will amend the budget."
Andrew Moser is a staff writer for the Oxford Leader.