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School Board still plans to give 3.5 percent pay increase

Despite recommending the county commission finance $1.8 million in buses and provide a permanent source of increased revenue, Washington County School Board members refused to reduce the amount of money they are pulling from the schools fund balance for the 2013 budget.
“There needs to be some sort of reconciliation between this committee and the school board,” Mayor Dan Eldridge said during the Aug. 7 called meeting of the Budget Committee. “The goal is to not increase the burden on local taxpayers or put ourselves in the position of an imminent tax increase.”
Budget Committee members have offered two proposals to meet the school system’s request of $62.3 million and reserve the schools fund balance.
During their August meeting, county commissioners will consider using low-interest bonds to purchase three years of schools buses, which would save the system almost $600,000 annually.
In addition, the Budget Committee is recommending the reallocation of 4 cents from the portion of the current tax levy directed to the county’s General Fund. The change would equal a $640,000 increase of revenue to the county school system each year.
The shared revenue requirement would provide $523,000 to the Johnson City School System, for an increase of more than $1 million to education during 2013.
Eldridge said the increased pennies would supplement the loss of federal funds to the county system that paid for guidance counselors, a cost that was moved to the schools general fund.
The biggest differences between the schools third revised budget and the Budget Committee’s second proposal, according to Eldridge, are the net proposed expenditures.
While word from the county commission is unknown at this point, school board members refused the Budget Committee’s recommendation to save more than $500,000 by providing a 2 percent salary increase for its employees rather than the planned 2.5 percent. The 1 percent step increase provided by the State of Tennessee would have all school system employees receiving a total 3.5 percent increase.
The school board’s decision to maintain the salary increase and make no further cuts to the budget essentially negates the offered assistance with the purchase of school buses, requiring $1.3 million from the fund balance rather than the $751,000 proposed by the commission.
Eldridge acknowledged the ultimate decision on how the money gets used is up to the school board. “Do you think they understand we’ve done all we can do?” he asked Director of Schools Ron Dykes.
“Are they putting the schools and essentially the county in a position for another needed influx of dollars?” Eldridge asked, adding a further increase in the tax levy allocation is unlikely.
Dykes said the school board is in survival mode as it faces the requirements of the new common core curriculum.
However, Eldridge pointed out the majority of budget dollars is going to salaries.
Dykes said the board’s philosophy for the last two decades is to provide the state mandated increases for certified staff to support staff also.
Commissioner Mitch Meredith warned that practice could be setting a funding level the county will be unable to sustain. “If we’ve allocated pennies, it seems logical not to use the schools fund balance,” he said.
Should the schools use another $1.3 million for the 2014 budget, its fund balance would be reduced to the minimum amount the state requires the system to keep in reserve. As a result, new revenue would be required for 2015.
“My concern is the new source of revenue will come out of the taxpayers’ pocket,” Meredith said. “We know how they feel, and that’s who I work for.”
Commissioner Joe Grandy said the failure of the sales tax referendum is a clear indicator of the citizens’ opinion on paying more for the schools, and Eldridge asked Dykes if he agreed with the assessment.
“I agree with what I’ve told you for the last five years – you’re underfunding education,” Dykes responded.
Eldridge said the commission’s approval of the Budget Committee’s recommendations should provide adequate funding for the next two years.
“This strategy is to buy time to work with the state,” he said, adding there are no guarantees. “If we aren’t able to get an appropriation or a change in the BEP formula, we will be having a very different discussion in two years.”
Dykes said the system will continue to be prudent and conservative. “We may not spend the full $1.3 million when all is said and done,” he added.
Grandy made a motion to approve the school board’s budget of $61.7 million for 2013. The motion passed, with Meredith opposed.
Commissioner Pete Speropulos made a motion to recommend the tax levy reallocation to the commission, which was seconded by Grandy and passed unanimously.
Meredith emphasized a 12 percent funding increase for the schools is being proposed. “It needs to be said that Washington County does support education,” he said.
“At a local level,” Grandy added.
Commission Chair Greg Matherly said he thinks the Budget Committee makes every effort to work toward savings. “We give money to the school board every year, but we can’t tell them how to spend it,” he said. “They have an obligation to do the right thing just as I do.”
Matherly said several building repairs are pressing issues that will not be funded during the upcoming year. “We have no control. We write the check and they do what they think is right with it,” he said. “But when the money’s gone, what are we going to fund?”