SD2 trustees look at budget choices

2010-06-21T21:09:00Z 2010-06-22T23:43:57Z SD2 trustees look at budget choicesROB ROGERS Of The Gazette Staff The Billings Gazette
June 21, 2010 9:09 pm  • 

The Billings School District 2 board will continue its meeting tonight after trustees reached the four-hour mark during their meeting Monday night.

Trustees were in the midst of discussing whether to keep in place cuts recommended by its budgeting committee when they voted to table the discussion.

Still on the agenda was the issue of whether the board should take to voters $12 million in federal bonds available to the district this fall.

“I feel like we’re rushing,” said Trustee Joyce Weber as discussion on the budget became increasingly convoluted and two opposing motions were put forward.

Facing the board was a recommendation made last week by the budgeting committee to keep in place $1.9 million in cuts. The group had initially recommended the cuts in December. In May, the district passed a $1.8 million elementary general fund mill levy.

By the 2012 school year, the district will be facing a potential budget shortfall in state funding from $5 million to $10 million. Officials want to keep the cuts in place in order to better prepare for those shortfalls.

A portion of those cuts were in the form of a reduction of roughly 18 full-time-equivalent employees in the elementary school district.

Superintendent Jack Copps recommended with the mill levy in place that the board buy back those positions — three academic coaches, two special education nurses, 13 custodians and two academic program specialists — at a cost of $559,000.

Keeping those jobs would mean the district would make $1.4 million in cuts rather than the full $1.9 million.

Further complicating the issue for the board is the layoffs that would result if the board decides to go after the full $1.9 million in cuts. The district has a June 1 deadline for sending out layoff notices. No layoff notices went out this year, meaning that the 18 jobs on the chopping block are currently filled with employees who were told this spring they still had a job.

“I’m very torn by this,” said Chairwoman Barbara Bryan.

Also at issue is the district’s reserve account.

Under state law, the district can hold in reserve up to 10 percent of its general fund budget. Currently it maintains a reserve of 5 percent.

With the passage of May’s general-fund levy, the district will finish the school year with a budget surplus. Adding that projected surplus to its reserve, the district would jump up to 11.2 percent.

Trustees are grappling with deciding what to do with that additional 1.2 percent over the 10 percent reserve, an amount of roughly $778,000.

The money could be applied to reversing the cuts to personnel or it could be applied to deferred maintenance. Trustees will continue that discussion and likely make a decision tonight.

Following the budget discussions, the board will then decide whether to seek two bonds worth $12 million to improve School District 2 facilities.

The bonds, part of program that uses federal stimulus dollars, will raise property taxes for Billings landowners for the next 16 years. Under the program, the federal government will pay the interest on the loan and the district will pay back the principal.

Helping reduce the debt load is a sinking fund that will accompany the bond and collect money over the 16 years that will then go toward paying back the loan. There’s also a possibility of state funding to help the district pay back the bond.

Trustees are hopeful of the $12 million borrowed the district will have to pay back only roughly $4 million.

Contact Rob Rogers at rrogers@billingsgazette.com or at 406-657-1231.

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