The perils of using one-time-only funding for ongoing educational expenses became apparent when Billings Public Schools chief financial officer found an error of nearly $1 million in the high school budget forecast and a $268,000 error in the elementary forecast for the fiscal year beginning this summer.
To make ends meet this school year, trustees and administration used federal American Recovery and Reinvestment Act money and other one-time grants to fund some staff positions. Desperate times require desperate measures, but there are consequences: The one-year money buys another year of service to students, but postpones a budget cut.
This use of one-time money led to a budget forecast error last fall. Forecasts were correct in May and August last year, but in September the forecast changed to mistakenly put the budget gap lower than previously projected. That alone should have raised warning flags. Why the sudden change?
As the forecasting process continued last month, district finance staff went through this year’s budget line by line and detected the miscalculation.
The proposed solution: “In the future, all general fund budget forecasts will include a discussion of the use of one-time funds in meeting current year expenses as well as a discussion of any assumptions about the availability and impact of the use of one-time funds on budget forecasts,” Superintendent Jack Copps and Chief Financial Officer Thomas Harper wrote in a letter to trustees on March 5.
Harper took responsibility for the error in miscounting future expenses, telling The Billings Gazette: “That should have occurred to me way back when. It didn’t.”
There is also good budget news recently. The February count of K-6 students showed enrollment holding steady, instead of dropping 2 percent from October as usually occurs. That will mean more state funds for elementary schools next year and offsets the September miscalculation. Also, the district’s insurance consultant has said that less than the projected 12 percent increase may be needed to maintain the employee health plan next year.
Forecasting the Billings school budget is a big job with some factors that district officials cannot control. That’s why it is imperative that the information that is known be communicated clearly and accurately on a timely basis. The district’s credibility is always on the line when budgets and funds forecasts are made.
Library Board supports bank project unanimously
A bank project planned for Broadway and Fourth Avenue North received a vote of confidence last week from the Billings Library Board. Library Board members voted unanimously in favor of a motion that recommended City Council approval of an agreement to sell parking space to Stockman Bank. The board’s motion also expressed members’ concern about selling land just as its facility planning process begins.
The 2010 Downtown Library Facility Committee is scheduled to meet at noon Wednesday at Parmly Billings Library for the first time. This committee has been appointed to study various options for an improved downtown library, including renovating the existing library, expanding the existing building, building new on the same double block or relocating elsewhere downtown.
The city and Stockman Bank are close to agreeing on a buy-sell for 50 feet of parking space the library owns adjacent to the bank’s property, which it purchased from the city four years ago, according to representatives for both parties. The agreement under negotiation would provide that the bank transfer the parking space back to the city if it is needed for a parking ramp or for library expansion within five years. The city would provide parking space for the bank in the ramp or nearby.
A proposal tentatively is scheduled to be on the City Council work session agenda for April 5 and presented on April 12 at a regular session for a council vote on the sale, Library Director Bill Cochran told the Library Board.
The agreement that the city and the bank are negotiating would give both what they need: the ability and flexibility to move forward with a new bank and a better library. This can be a win for everybody.