County Commission to Decide on School Budget Monday Night

August 6, 2011
Dwayne Page
Mark Willoughby

As Monday night approaches, Director of Schools Mark Willoughby and members of the board of education are hoping that the county commission will see fit to increase local funding for schools.

The county budget committee is asking the county commission to adopt a new school budget which gives the school system a five cent increase in the property tax rate which equates to $210,000. But Willoughby, in an interview with WJLE Thursday said that would only be enough to cover proposed pay raises. "The five cents basically takes care of the 1.6% raise (local match) that the state is giving to all certified employees. We as a system are giving a 1.6% raise to all certified employees. We as a system are also proposing to give a 3.2% salary increase to all non-certified employees. On the part of the certified personnel, that (local match) is on the state portion of the salaries. That is not on the state portion plus the local portion. So the five cent increase that the budget committee has proposed to the full county commission just takes care of the pay raises," said Willoughby

Because the school budget is so complex, Willoughby said it is difficult for many people to understand. "We have money coming from many different sources. We have grants. We have local funds, federal funds. We became aware just a few days ago that we are going to get another grant but we don't yet have the specifics of how much that is going to be but it could be up to around $200,000. We have a Jobs Grant which I'm concerned about in this budget. The Jobs money in this grant is over $660,000 but I doubt very seriously if that will be in the budget next year. So if we use over $900,000 of our reserves to balance our budget this year and the $660,000 Jobs Grant money goes away next year, then we're looking at close to $1.6 million (needed to balance the budget next year) if everything stays the same. I do want to say though that revenues have come in more than expenditures in the past, which has been good. We were able to end our school year this year with more than $700,000 to the good. But each year, if you didn't have to use your reserves to balance the budget, it could be like building up a savings account. We do have reserves in there for things like if we had to have a roof in an emergency situation, we could use those reserves for that. But we do not need to use our reserves for day to day operations like we've been having to do. It has become a tradition for us to use reserves to balance our budget each year. I wish we didn't have to do that," said Willoughby

In recent years, the county has been budgeting more money ($1,540,000 this year) from the special school sinking fund or local sales tax money for school operation. Willoughby said he believes the sinking fund should be reserved for capital projects. "We really don't like to use the sinking fund for our general operating budget. We would like to use that for capital outlay projects. We have two schools that definitely need a new roof. Of course the Smithville Elementary cafeteria got one (roof) because of the May storm damage but that was from the insurance. But DeKalb Middle School and DeKalb West School are both in need of a roof. As long as we use our sinking fund for operating expenses, its difficult to hold that money back for capital outlay projects. We would like to have a budget where we do not have to use reserves," said Willoughby

Willoughby said that while the school system has received an increase in local funding from sales tax money and in the state allocation of Basic Education Program (BEP) funds in recent years, the percentage of local property tax money designated for schools has declined. Based on per capita statistics, Willoughby said he believes DeKalb County can afford to do better for schools. "Out of fifteen counties in the surrounding area, Van Buren, Pickett, Fentress, White, Macon, Clay, DeKalb, Cannon, Jackson, Overton, Warren, Putnam, Cumberland, Smith, and Wilson, DeKalb County ranks ninth in per capita income at $17,306. Looking at the property tax rate, we rank twelfth at $1.46. The next county up from us happens to be Overton county at $1.80. Our sales tax rate is a little bit higher than their's (Overton county). Their's is 9.5% and ours is 9.75% but they have a $30 wheel tax and I don't know where that $30 wheel tax goes to. But based on property taxes, if you have a $100,000 piece of property in DeKalb County, you're paying $365 in property taxes. If you have a $100,000 piece of property in Overton County, you're paying $450 in property taxes. In Clay county, its $775 (property taxes) on a $100,000 piece of property. I do want to point out though that one cent (property tax rate) in DeKalb County brings in more money than some of these other counties but vice versa, one penny in other counties brings in a lot more than in DeKalb County," said Willoughby

Director Willloughby said he believes the county should appropriate a greater share of local property tax dollars for schools. "In DeKalb County, of the tax rate and assessments for 2010-11, the percentage that the school gets is 32.88%. But when you go back to 1993, the school system received 67.22% of the local property tax in the budget. In the year 2000 it was 60%. In 2003 it was 48.47%. In 2007 it was 38.42%. This is a percentage of the property tax rate and assessment for schools. I do want to point out though that more money is actually coming into the school system and the county because of the increase that one cent of the tax rate brings in. But our increase (for schools) has actually come from sales tax not from the property tax increase. So the more people buy, the more money we get. So that's where these percentages come from. This just shows how it (percentage of property tax fundsfor schools) have decreased over the years. Property tax is one of the things that is consistent. Sales tax is not consistent. We feel like the school system should be getting more of the property tax dollars while we do realize that the school system, over the years has received more sales tax dollars as the sales tax has increased. We (schools) get two thirds percent of the sales tax," said Willoughby.

As for schools, County Mayor Mike Foster insists that the county is adequately funding schools with local money at more than $4.5 million dollars and is exceeding the state's BEP required local match for schools by close to $200,000.

"Schools have gone from over $11- million dollars nine or ten years ago to $19.9 million dollars today and that does not include the $2.8 million federal budget that goes in there for the cafeteria fund," said Foster.

The General Purpose Schools budget totals $19,932,993. The property tax rate for schools as recommended by the budget committee is 55 cents per $100 of assessed value, five cents more than last year but not as much as the school board has requested. In addition to the $2-million 331-thousand 429 for schools generated by the 55 cent tax rate, the county commission is expected to transfer $1-million 540 thousand from the local purpose tax fund (sinking/local sales tax fund) to help operate schools this year along with $570,645 to fund the school debt service for payment on the Northside Elementary School and roof at Smithville Elementary School. The school system also gets $55,954 from Trustee's Collections (prior years), $30,309 from Clerk and Masters collections (prior years), $12,823 in interest and penalty, $8,603 in pick up taxes, and $1,000 in bank excise taxes. The total appropriation of local funds for schools is $4,550,763. The state BEP allocation for schools is $13-million 198-thousand dollars, an increase from last year's budget of $12,508,000. The school system also receives, according to County Mayor Foster, some $2.8 million in federal funding in addition to local and state appropriations.

Director Willoughby is still holding out hope that the county commission Monday night will adopt the board of education's revised budget proposal for schools, which asks for a larger tax increase than the proposal offered by the county budget committee.

Even if the county commission doesn't approve the school board's revised budget, Willoughby said pay raises and some new positions could still be funded, while other needs would have to wait. "My hope is that the county commission would pass the revised budget that we sent over. In that revised budget, we had already taken out, in some particular situations, monies in that revised budget. One of the places we had taken out was the county wide instructional coach. The P.E. teacher at Northside Elementary, we had taken that particular spot out. We had also taken the (assistant) soccer coach (positions) out. We're doing a lot of renovation with the chemistry/science lab at the high school. We had added $250,000 in the budget for the science lab at the time when we did that (planned it). We did not know (at that time) exactly how much that was going to cost. We now know that's going to be less than the $250,000. We have actually taken $250,000 out of capital outlay (for the project)," said Willoughby.

Some new positions, Willoughby said, are almost a must, given new state requirements being imposed on local school systems. "Let me give you an example of how this year is different than past years. A significant amount of money is in the budget this year, which hasn't been in the budget before and that's for three new assistant principal positions. That's estimated at close to $230,000 and that's not talking about the take home pay. By the time we meet the matching requirements we have to meet, the retirement with the benefits, insurance and everything, that is where we come up with the $230,000. Elementary principals, such as Smithville Elementary, (are especially being affected by new evaluation requirements). Last year, Mr. (Bill) Tanner had to do twenty eight observations of his staff. This year with the new guidelines, he tells me that he will have to do two hundred and eight observations. There's just no way that can take place. There's no way he can do that without help. I think we should have had assistant principals a long time ago, but these are particular things which have come down and are mandated that we have to do to get those observations taken care of," said Willoughby.

Willoughby said that the three new assistant principals, including one at Northside, Smithville Elementary, and at DeKalb West Schools, can help ease the burden of conducting those extra observations and evaluations.

As for other new positions, Willoughby said "At the high school, we asked for one new position for a site coordinator. That's basically to take care of on-line dual credit courses and distance learning classes. We have thirteen different classes that are going on in the lab and there's a minimum of sixty students. Try to take care of that and increase the dual enrollment and increase the on-line classes. That's the only way we're going to meet those needs. We also have students who are taking Spanish III, now that's not a dual credit class, but they're taking the course (on-line) from a class in Cookeville. We had also offered Advanced Placement (AP) History so students in Cookeville could take our History class (on-line). We're trying to do more of that back and forth which helps out both school systems. Financially it helps out our system by not having to hire a full time teacher to do that. That's what a lot of rural school systems are having to do in order to ease the budget demands. What is needed at schools now is completely different than what was required as recent as eight or ten years ago such as our technology requirements, our on-line courses, and our dual credit classes. Next year, its going to be a requirement that all students take four math classes, one math class per year. So by doing that we will have to have another math teacher in there. This year with the way the budget is, if we can get by one more year without doing that (adding a math teacher) we will but its not the best for the children. What we try to propose in a budget to send to the county commission is what is best for children. I don't have the exact numbers but I think since 2003-04 to today, we have increased in enrollment by probably over 400 students. That requires a lot of money. For example, math books this year cost an average of about eighty dollars so with 130 more students, that gets over $10,000. In our budget we do have those three assistant principals but we haven't hired them yet. We had in our budget the one extra teacher at Northside Elementary because we thought we were going to have to have that for numbers (due to an increase in the number of students). I can tell you now we have to have that teacher and we've already hired that particular teacher. As far as the other things in the budget we haven't made the new hires yet until after we get our budget passed. But we feel that what we have in this budget is extremely important," said Willoughby.

The school board initially adopted a tentative budget requesting a seventeen cent property tax rate increase for schools to fund pay raises for personnel and to add some new positions in the new budget. The county budget committee rejected the request for new money, except for pay raises. The committee asked the school board to make cuts in their proposed budget. The school board later revised its proposed budget and brought back a proposal asking for an eleven cent tax increase and more money from the sales tax or sinking fund to meet their budget request. The county budget committee again rejected the proposed spending plan but voted to recommend a consolidated budget that includes a five cent tax increase for schools to send to the county commission. Although neither the budget committee nor the county commission can dictate how the school board spends the money, the proposed five cent tax increase is just enough to cover the proposed pay raises for school personnel.

The overall proposed property tax rate recommended by the county budget committee is $1.62, which is ten cents above the certified tax rate. Five cents of the proposed increase would go for schools and the other nickel would be for the county general fund. County Mayor Foster has said that if the school board's revised budget plan is adopted, the overall property tax rate would have to be $1.72.

The school board has proposed a 3.2% pay raise for support staff or non-certified personnel and a 1.6% local increase to match the state's 1.6% pay hike for certified personnel (teachers)..

The school board, according to its revised plan, seeks to add the following new positions:

A new fifth grade teaching position at Northside Elementary School.
An additional math teacher at DeKalb County High School
An assistant band teacher
A support staff site coordinator at DCHS
A special education teacher at DCHS
Three new assistant principals (one at each DeKalb West, Northside Elementary, and Smithville Elementary School)

The school board's revised budget adds local funding back to the general fund for three teaching positions and an educational assistant, which for the last two years have been paid for with federal stimulus or American Recovery and Reinvestment Act (ARRA) funds that have now been exhausted

Also remaining in the spending plan are requests for the following increases:
Textbook adoption (Math)- $40,000
Minimal increase in utility costs- $6,000
Increase in maintenance of plant supplies- $23,000

The county commission will be asked Monday, August 8 to either approve or reject the school board's revised budget request or to approve or reject the county budget committee's recommendation. That special meeting starts at 6:00 p.m. following a public hearing on the proposed budgets and tax rate at 5:00 p.m. in the basement courtroom of the courthouse

Meanwhile, Willoughby and members of the school board are still at odds with County Mayor Foster and members of the county commission over the county's decision in August 2007 to cut the local property tax rate for schools by sixteen cents and to give back to the school system an equal or greater amount of local funding from the sinking or sales tax fund for school operation

That decision by the county commission came after the voters of DeKalb County, in May 2007, approved a referendum, increasing the local option sales tax rate from 1.5% to the maximum level of 2.75%

Some claim they were under the impression that the entire sales tax increase, as approved by the voters in the referendum, would immediately go directly to schools, in addition to the property tax rate that was in place for schools at that time. However Foster said that was never the intent. It was always intended, he said, to be a direct tax swap from property tax to sales tax revenues for schools. While the exact amount of the property tax cut to schools wasn't made specific before the sales tax referendum, Foster insists that it was explained to the public that property tax payers would be getting an overall 19 or 20 cent property tax break, with the passage of the sales tax referendum. "That was the intent. It was the design that the sales tax would take the place of part of the property tax rate for schools. We made that clear in the (public) meetings and when it (referendum) was voted on and that's exactly what was done. That's why you saw a decrease of sixteen cents in the property tax rate for schools at that time (2007)," said Foster.

Foster added that since the sinking fund is only designated for schools, the rest of county government could not legally have taken money from that fund in a tax swap. He said the tax swap could only have been made with schools.

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