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Archive for Tuesday, July 12, 2011

Lawrence school district told to spend savings

$3 million must be used during next 12 months

July 12, 2011

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Board elects officers

With four new members sworn into office, the Lawrence school board elected two incumbent members as officers for 2011-12.

Mark Bradford, who received the most votes in the 2009 board election, will serve as president. Vanessa Sanburn, who finished second in the 2009 election, will serve as vice president.

Board members also agreed to meet Aug. 22 to discuss setting goals for the coming school year.

The state is requiring the Lawrence school district to drain $3 million from its main savings account during the next 12 months, an unexpected and accelerated spending plan that is leaving members of the Lawrence school board with an unwanted problem they still know could have been worse.

Board members learned of the requirement Monday night during a meeting that welcomed four new members: Rick Ingram, Shannon Kimball, Randy Masten and Keith Diaz Moore.

During a report about the district’s upcoming budget plans, board members were told that they would need to meet a strict interpretation of a state law, as advised recently by the Kansas State Department of Education: The district’s special contingency fund, now capped at 10 percent of the district’s operating budget, would need to be limited to 6 percent by June 30.

That means the district’s fund balance would need to drop from $6.8 million to nearly $3.8 million, all in less than 12 months.

Rick Ingram

Rick Ingram

Shannon Kimball

Shannon Kimball

Randy Masten

Randy Masten

Keith Diaz Moore

Keith Diaz Moore

Having another $3.05 million to spend might sound like a good problem to have, but new board members said they’d rather keep the money in reserve. As the state continues to cut funding for public education, several said, the district soon will have less money held back to soften the painful cuts that have been coming for years and show few signs of letting up.

“They’ve made us remove the cushion,” said Masten, who has been critical of state spending priorities. “They’ve told us they’re not comfortable with us having that cushion.”

The $6.8 million “cushion” had been expected to help the district offset anticipated declines in state financing for the next four years. In March, the district had approved a plan to help balance its budget for the coming year — a budget that would start with $3 million less money because of state cuts — by using $750,000 from the district’s contingency fund.

Dipping into savings would be coupled with other spending cuts, plus closure of Wakarusa Valley School, reclamation of the district’s Diploma Completion Program and implementation of a bulk purchasing system, to get to $3 million in savings.

Now, board members must decide how to spend an additional $2.25 million that they’d hoped to hang onto for another few years. A complicating factor will be finding ways to spend the money effectively while minimizing ongoing costs.

“Our job is to figure out where that is,” Ingram said.

Masten suggested that money might be used to buy vocational equipment for Free State and Lawrence high schools or to finance other such “one-time” expenditures. The only requirement is that the money go into the district’s general fund, which also is used to pay ongoing expenses such as teacher salaries, utilities and other operational needs.

Decisions about spending didn’t come Monday night, but some could be expected soon. District teachers are seeking raises of $1,500 each, which would cost about $1.4 million.

Kim Bodensteiner, the district’s chief academic officer, suggested the possibility of rehiring math and reading specialists let go at the end of this past year, upon expiration of financing from federal stimulus programs.

Such personnel could be offered jobs knowing that they might only last another year, she said.

Spending down the contingency fund also could have an even longer-reaching effect, Diaz Moore said: The district’s bond rating could decline, leading to higher interest rates on future bond issues, which in turn either would make projects smaller or cost taxpayers more.

“The state is telling us not to serve our taxpayers as well as we could,” he said.

Comments

notleft_notright 2 years, 9 months ago

There is only one wrong answer, multiple choice question: What should the USD do with three million dollars of taxpayers money?

a. Put money into the budget and reduce the mil levy.

b. Put into infrastructure maintenance needed over the next 2 years.

c. Keep the money for another year in case of an emergency.

d. Spend it because it is burning a hole in the pockets of board members.

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Truth 2 years, 9 months ago

Put some of the money into the teachers' salary schedule. We lose too many teachers to neighboring districts because of low pay in Lawrence. We could fund the teachers' request this year and have money left over. Why should the district have such a large cushion in the first place?

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Benjamin Roberts 2 years, 9 months ago

"...board members were told that they would need to meet a strict interpretation of a state law, as advised recently by the Kansas State Department of Education:"

It seems to me that the legislature advised districts of this over 5 years ago.

Chapter 72: Schools Article 64: School District Finance And Quality Performance Statute 72-6426: Contingency reserve fund; limitations. (a) There is hereby established in every district a fund which shall be called the contingency reserve fund. Such fund shall consist of all moneys deposited therein or transferred thereto according to law. The fund shall be maintained for payment of expenses of a district attributable to financial contingencies as determined by the board.

  (b) (1)   Except as otherwise provided in subsection (c), at no time in school year 2008-2009 through school year 2011-2012 shall the amount maintained in the contingency reserve fund exceed an amount equal to 10% of the general fund budget of the district for the school year.

  (2)   Except as otherwise provided in subsection (c), at no time in school year 2012-2013 or any school year thereafter shall the amount maintained in the contingency reserve fund exceed an amount equal to 6% of the general fund budget of the district for the school year.

  (c) (1)   If the amount in the contingency reserve fund of a district is in excess of the amount authorized under subsection (b), and if such excess amount is the result of a reduction in the general fund budget of the district for the school year because of a decrease in enrollment, the district may maintain the excess amount in the fund until depletion of such excess amount by expenditure from the fund for the purposes thereof.

  (2)   The limitation on the amount which may be maintained in the contingency reserve fund imposed under subsection (b) shall not apply to any district whose state financial aid is computed under the provisions of K.S.A. 72-6445a, and amendments thereto. Any such district may maintain the excess amount in the fund until depletion of such excess amount by expenditure from the fund for the purposes thereof.

  History:   L. 1992, ch. 280, § 22; L. 1993, ch. 51, § 1; L. 1995, ch. 160, § 5; L. 2002, ch. 196, § 3; L. 2005, ch. 2, § 11 (Special Session); L. 2006, ch. 197, § 18; L. 2009, ch. 106, § 2; Apr. 30.

There is a term for Dolt and companies failure: Willful Ignorance.

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Sigmund 2 years, 9 months ago

“The state is telling us not to serve our taxpayers as well as we could,” he said."

Ask the Kansas Legislature to change the law to allow a larger school savings accounts so that the district isn't forced to waste tax dollars or face a fine from the state of Kansas. It is a no-brainer politically as either party could sponsor the legislation and I can't imagine either political party opposing it.

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Doppleganger 2 years, 9 months ago

They have to spend it to get more next year. This is the same technique of money management I use with family members. I tell them to spend their weekly allowance before I give them more. This is sound money management used by the doppelganger leaders.

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Scott Morgan 2 years, 9 months ago

moderate, I like the idea. Teachers and firefighters are two unique groups which always provide hard to figure correct pay. When trying to look at both groups regarding salary it's easy to misjudge. Misjudging in both cases can have horrible results. Teaching even more so, for the results will be seen much later, years in fact.

Failure to pay our instructors properly also means we train many great Blue Valley educators for instance. Or Shawnee Mission, Liberty Mo, districts realizing manpower is a real cog in successful education. Yes, by paying our instructors less we actually train outstanding teachers and many who leave.

I say a nice bonus and each instructor receives a nice brand new Snuggy before Winter. Not the cheap Snuggy either, but good ones.

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Tracy Rogers 2 years, 9 months ago

Why not donate it back to the State for their "renovation" project. They seem to be more interested in funding that thing that they do the schools.

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George Lippencott 2 years, 9 months ago

Perhaps we might consider using this money to give our teachers a nice bonus. That would demonstrate appreciation without locking in salary increases we may be unable to pay in future years.

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Paul R Getto 2 years, 9 months ago

You can only eat the seedcorn once; after that it will get tough. Superintendents keep as much as they can in reserve to pay unexpected bills, to order food service supplies or to pay special education bills, all of which tend to come due when there isn't much money coming in. The reserves are also useful in the times when Dale Dennis doesn't have enough money to send out to the districts, to meet payroll for example. California has discovered an alternative method....give employees 'vouchers' stating they will be paid later. The attempts to force districts to spend down their 'reserves' is misguided, but so is much of this administration's approach to governance.

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LHS56 2 years, 9 months ago

Agree with the above but - why this mandate to spend? Is there a problem saving money for an unexpected need (no...not more sports facilities)? We've hear the need for upgrades of our facilities. This is a start.....if required by the State. Ohhh....and I still have not received a reasonable explanation about what the School District leased to fund the nine million needed for the sports facilities. Who is leasing what that we are paying one millon a year? Eight million left over from the money authorized by the voters for South Junior High. One million from the Capital Fund. And...nine million from a lease agreement. (Funds used to build the sports facilities.) Lease Agreement ???????????????????????

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2 years, 9 months ago

What about any deferred maintenance on the buildings?

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Alfred_W 2 years, 9 months ago

Yep. Small government getting out of people's way again. If there's any chance the district's bond rating will go down as a result of lowering the reserve, this needs to be fought tooth and nail because in the long run it will cost us the taxpayers a lot more money.

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Bob Forer 2 years, 9 months ago

Buy some football equipment. (just kidding)

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irvan moore 2 years, 9 months ago

maybe they can build a parking garage

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Robert Rauktis 2 years, 9 months ago

That money could buy an "impartial" or neutral football stadium.

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William Ed 2 years, 9 months ago

Let me see, how about a bunch of flags for our stadiums, hire some people to fill empty offices at McDonald drive, and most importantly, hire some lobbyists to see if the Legislature could work on the convoluted accounting practices that haunt the financial administration of the state's school system. Are the plans already drawn up for the Superintendent's new schools? The task force charade will certainly come to the conclusion that the district needs two new mega schools. Can't we go ahead and buy the computers, routers, and other equipment now, so that they can be stored until the schools are built??

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dragonfly0221 2 years, 9 months ago

I don't think it should only go for the high schools. I think each school should get x amount of money to upgrade what the school needs, play ground equipment, kitchens, books, what ever they need. I don't have any kids in the lower grades mine are at the high school level.

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LadyJ 2 years, 9 months ago

Does this mean they can keep the mill levy down for the district? :P

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oneeye_wilbur 2 years, 9 months ago

$3 million for USD 497 will be gone in a matter of minutes. The district won't see anything productive form it and then the board will go back to the public and cry for more money and the mill levy gets raised.

$3 million is like paying 20 people at the admin center and not much to show for it.

Just as well, get it in cash and leave it on the sidewalks in front of the schools, or put some cash in lunchboxes for the kiddies so they won't go hungry. Mcdonald's will love to have the extra cash, just as they got when one of the grade schools sponsored a program at McDonalds and sold cards for cookies(which had only a 30 day period to redeem).

So, take the 3 million and buy supplies for the grade schools so the parents and kids are not out pimping for McDonalds.

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OonlyBonly 2 years, 9 months ago

"spend the money effectively" always a problem with the Lawrence School District!

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LadyJ 2 years, 9 months ago

Didn't they get a storage facility so they could buy things in bulk? Buy things and store them for the next year or two.

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lunacydetector 2 years, 9 months ago

the school district can build a building for SRS

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LadyJ 2 years, 9 months ago

What if they prepaid some bills so they have a credit for next year? I do that when I get extra money so I don't have to make payments when I know I won't be working as much.

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poolside 2 years, 9 months ago

Buying one time big ticket items like the voc-rehab equipment and/or DME assistive devices for the special pops makes the most sense. Or upgrading kitchen and maintenace equipment.

It hurt like heck to see Grant and Wakarusa fall. Because of city growth I understood a little more the decisions of East Heights and Kaw Valley/India.

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Benjamin Roberts 2 years, 9 months ago

The mysterious contingency fund now surfaces. Parents have been asking the district to access it for the past two years to keep schools fully funded and operational; including keeping Wakarusa open. NO, it could not be touched, it had to be saved for a different rainy day. And, all along the district was operating under a falsehood.

The new school board needs to eliminate the grossly incompetent leadership of this district. If Dolt, et al, are not grossly incompetent (ignorant) then they are outright deceitful; neither should be tolerated.

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