By Meg Peters
Review Co-Editor
With about a $254,000 surplus in the books for next year, the Lake Orion School Board of Education approved the 2015-2016 opening budget at the June 24 board meeting.
The initial budget was approved based on projected student counts, which will be finalized in October.
The general fund balance as of’June 30’contained $8,178,522, or about 10.3 percent of total expenditures, which are estimated at $79,051,352.? The proposed budget is $79,305,458.
In order to balance the budget the district had to reduce about $1.3 million in shortfalls prior to’July 1.
First, the district cut personnel.
Fourteen teaching positions were cut, however the district guaranteed to bring at least three back. The 11 instructional layoffs reduced the shortfall by about $600,000. In addition, the district laid off several non-instructional positions totaling near $300,000.
Second, the district negotiated a furlough day to be implemented next year.
The furlough day eliminates one day of pay across the board for all remaining positions, and will be extracted from each paycheck throughout the year.
The furlough day is estimated to bring the district about $275,000 in terms of savings.
With the layoffs, furlough day and other minor budget adjustments, the district is entering 2015-16 in the green.
‘Budget adjustments allowed us to get our balance back on track, and then get a little ahead of the game,? Assistant Superintendent of Business and Finance John Fitzgerald said. ‘Our goal is to slowly grow [the general fund] without devastating any programs.?
In exchange for the furlough day pay cut, 20 teachers will be offered the opportunity to take a sick day before or after a holiday break. As part of their contract, teachers are not permitted to take a day off before or after a break, however, under the deal 20 teachers can sign up each available day on a first come first serve basis. ??
There are about 400 instructional positions in the district and about five slotted breaks.
The shortfall
Nearly $480,000 of the 2014-15deficit was tied to a predicted resident student loss, Fitzgerald said.
Student enrollment’namely student foundation allowance or per pupil funding’represents the pinnacle of the district’s revenue source, therefore Michigan’s Student Count Day is paramount to budget preparation.
For 2015-16 the district predicts about a 60 resident student loss.?
Without the Schools of Choice program, which was recently expanded from grades K-2 to K-5, the district would have to make more significant reductions.
The SOC application period ended in May, and the district received 245 applications. All 245 outside-district students can enroll, the board confirmed, however the district expects about 70 percent to undergo the enrollment process, or about 140 students.
Adding that to the 60 resident student loss, the district budgeted for an increase in 80 students. SOC students bring their own per pupil funding to the district, which may not be as high as Lake Orion’s.
In 2015-16, each Lake Orion student will bring about $8,033 to the district in foundation allowance, or about an $8 gain in per pupil funds, which is ‘not even registering in the calculation,? Fitzgerald said.
‘In addition to the student loss, we anticipated another $200,000 loss in per pupil revenue based on the Governors? original budget proposal, plus cost increases around all aspects of our operations including wages, benefits, and program changes.?
The district also must contend with the change in the Student Count Day methodology, which could cost between 15 to 17 students, Fitzgerald said.
Last year’s method used 90 percent of the 2014 October count, and added it to 10 percent of the 2015 February count.
This year it is reversed. The total count will use 90 percent of students present on count day in October, and add it to the ten percent aggregated in February 2014.
Normally this wouldn’t be a huge issue, if the budget wasn’t so tight.
‘It hurts us, because we’re now counting last year’s numbers as part of this coming year’s formula,? Fitzgerald said.
Although student enrollment has been trending in the negatives over the past several years, the school board is looking forward to slight enrollment increases with new housing opportunities close by.
Fiscal year 2012 saw a loss of 68 students, in 2013, the first year the SOC program was implemented, the district lost 124 students. In 2014, although slightly better, the district still lost 84 resident students.
In 2015 the district gained 56 students.