School board reviews draft budget
Mehlville Board of Education members recently reviewed a first draft of the district's budget for the 2004-2005 school year that projects salary increases of roughly 2.3 percent for teachers and classified staff.
Randy Charles, assistant superintendent for finance and Mehlville's chief financial officer, presented the first draft of the 2004-2005 budget to the school board during a nearly five-hour meeting last week at Mehlville Senior High School.
While salary increases of roughly 2.3 percent are projected for teachers and classified staff for the coming school year, a 1 percent salary increase is projected for building administrators and certified directors, Charles told board members May 11. Central Office administrators, he noted, previously had informed the board that they voluntarily will decline any pay increases for the coming school year.
Before presenting an overview of the draft 2004-2005 budget, Charles noted that the district's Budget Development Committee, comprised of administrators, staff and faculty members, parents and residents, had met five times since mid-March to review revenue and expenditure projections and other information before formulating the proposal.
The draft 2004-2005 budget projects total revenue of $91,913,379, down from the previous year's projected revenue of $92,113,191, while total expenditures for the coming school year are projected at $91,564,456, down from projected expenditures of $98,217,244 for the current school year. End-of-the-year operating balances for the 2004-2005 school year are projected at $2,692,568 — 3.45 percent — down from the current estimate for the 2003-2004 school year of $2,828,016 — 3.49 percent. Under state law, a school district is required to maintain a 3 percent balance in its operating fund or be considered a "distressed'' district.
Regarding teachers' salaries for the coming school year, Charles told board members that discussions are continuing, but noted that certified salaries for the coming school year are projected at more than $3 million less than the current school year. The draft 2004-2005 budget projects certified salaries totaling $39,583,571, down from the projected cost for the current school year of $42,787,501.
"We're looking at salary increases at least 2.3 percent,'' he said. "In discussions, we've explored the possibility of trying to do a little better than that. It is going to be a stretch for us to do that. This particular proposal gives teachers their steps and channel changes. The building-level administrators' salaries and the certificated directors' salaries are tied directly to the teachers' salary schedule.
"So if you saw about a 2.3 percent increase for the teachers, you would see about a 1 percent increase for building principals and certified directors and, of course, as you already know, we have a zero percent increase for Central Office administrators,'' Charles added.
The draft budget also includes an additional $200,000 to cover the increased cost of teacher and non-teacher retirement contributions.
"... There's a $200,000 increase as a result of the contribution increases passed along by the Public School Retirement System (of Missouri),'' Charles said.
In response to a question, he said, "That's an additional one-half percent for teachers and that's a half percent coming out of their individual paycheck and a matching half percent contributed by the district. For classified employees, it's a quarter of a percent coming out of their paychecks and a matching quarter of a percent (from the district) as well.''
Additional increases in retirement contributions are anticipated "at least six, possible seven years in a row. We have that built into our long-range projection as well,'' the assistant superintendent said, noting, "... There's no additional money coming from the state or any other sources directly earmarked for that.''
While the draft 2004-2005 budget projects a decrease in certified salaries compared to the current school year, Charles said, "... Non-certified salaries see a slight increase. Again, that's a direct reflection of the decrease in certified positions, both administrative and teaching positions ... Benefits — despite the fact that we're reducing the number of staff, we do still see an increase in benefits. Again, that's largely due to the PSRS (Public School Retirement System) increases.''
The draft budget includes an additional $300,000 to cover the increased cost of employees' medical insurance premiums, Charles noted. The cost of medical and life insurance for employees is projected at $6,086,701, up from the projected cost of $5,707,653 for the current school year. The current year's projected cost is up $955,132 from the actual cost of $4,752,521 for the 2002-2003 school year.
Charles also discussed the projected operating fund balances for the current school year and for the 2004-2005 school year.
"With the reductions that have been made for the current year (and) what we know about the governor's release of withholdings, etc., right now the projections are at 3.49 percent for the current year and with all the staff reductions, the variety of issues built into the budget for next year, right now we're looking at 3.45 percent,'' he said. "So as we work through the next seven weeks or so as we approach July 1st, one of the issues that we have to deal with is: 'What if our situation changes? What if revenue projections improve? What if the numbers that come out of Jeff City or out of the county are a little better than expected?'
"One of the ideas that came out of the budget committee was that we need to seriously consider just letting that contribute to the end-of-the-year operating fund balance,'' Charles continued. "Another concern was we know we reduced field trips this year. I understand we have a plan for addressing field trips next year. That seemed to be an issue with some of the members of our budget committee. Also when we talked about finances with the teacher discussion group, an issue there was if there was any way that we could consider doing a little better, put at least something on the base of the teachers' salary schedule, is something that they would like us to consider as well.''
Board members took no action on the draft 2004-2005 budget. Budget Committee members will meet again at 6 p.m. Monday, June 14, in the boardroom of the Administration Building, 3120 Lemay Ferry Road, before a final version of the proposed budget is submitted to the board.
Committee members plan to review any last-minute changes to the proposed budget before a final recommendation is presented June 29.