The Fulton Public Schools Board of Education Finance Committee met Wednesday to give the district guidance on budget plans for fiscal year 2021.
Superintendent Jacque Cowherd predicts by the close of this year, the district will have $1.3 million left unspent in this year's budget - savings due in part to the COVID-19 shutdown.
"In a lot of senses, that's a positive from the way this year's gone," Cowherd said. "But it's also items that I suspect we will be tapping into in another year or two."
Also as a result of COVID-19, the district will receive $410,079 through the Coronavirus Aid, Relief and Economic Security Act.
Most of the discussion during the virtual Zoom meeting focused on plans for next year. The committee includes board members Leah Baker, Andy Bonderer and Matt Gowin.
During future meetings with the full board, the district will use guidance given by the committee to present a budget plan for approval. The budget is a plan based on estimates and projections - the district doesn't always spend the full expense amount, and sometimes, revenues come in above expectations.
The updated revenue projections Cowherd shared with the committee represented substantial changes to the budget draft last discussed weeks ago. Back in March, the district had hoped next year's revenue would add up to $24,802,427 - a figure that now seems too optimistic.
Funding for schools comes from local, state and federal sources. Factors like local property taxes and school attendance impact how much money a school will receive.
Cowherd presented the board with numbers reflecting assessed valuation, delinquent collections, attendance figures with summer school not taken into account and uncertain state support.
"The path forward financially is unclear right now," Cowherd said.
Cowherd told the board a lower revenue estimate of $24,015,096 is more probable.
During earlier planning discussions, the full school board approved a number of expense increases, such increases to the teacher base salary and a full minimum wage, with the older, more optimistic numbers in mind. The district plans also including a higher-than-expected health increase of $423,027.
All together, expense totals were estimated at $25,161,867 in March.
Keeping the lower revenues and increased expenses in mind, Cowherd asked the committee to consider cuts to supply and service funds to help lower the deficit. Jennifer Milligan, who works on accounting for the district, presented an extensive list of reductions. Many of the proposed cuts are in areas where the district spent less than was budgeted in past years.
"I left a lot of the supply accounts alone and didn't touch them," Milligan said. "These are only the ones that I thought we could safely reduce for one year and not have a big impact on our students."
Cowherd explained two potential solutions - one would include $250,000 in supply reductions and $100,000 in purchase service reductions, while the other more severe plan would include $366,325 in supply reductions and $153,350 in purchase service reductions.
Gowin asked whether it would be possible not to implement the cuts at all and instead rely on reserves to fill in the gap.
"I'm just thinking, if we ride a little bit this year - and I know it's not desirable - but it's, you know, a compliment to Jacque for putting us in this financial position to have this amount of reserves," Gowin said.
Bonderer expressed his hesitation at that, noting the financial uncertainty. Cowherd explained the cuts proposed represent a conservative approach.
"One year, we went through with $100,000 negative adjustment all year long, until they found out they made a mistake, and we got our money back," Cowherd said. "So if you go with a more conservative approach right now, you can always come back in November, December after adjustment time and say we're going to release this and revise those budgets upwards."
On the other hand, a more liberal approach might mean having to make last minute cuts at a later date, Cowherd added.
"I encourage you to think about that - that's those two strategies, but which is more amenable to just the community in the whole?" Cowherd asked.
By the end of the discussion, the committee members had settled on asking district administration to continue working with the plan with the smaller reduction. Before the plan is official, it will need approval by the full FPS Board of Education.