The state is currently monitoring the district's finances and provides any assistance needed. KDE financial field representative Scott Rose helped prepare next year's budget and was at Wednesday night's meeting to answer questions from the board.
Tax revenue was moved from the general fund to the district's building fund, accounting for the decrease in contingency, and some of the budget areas were adjusted because of additional accounts receivable and additional accounts payable found in the audit. Stacey Clark, the district's director of finance, told the board that she estimates the district will spend about $197,526 more than is budgeted for salaries and benefits.
In order to have a 2 percent contingency next year, the district needs to end the year with $760,844. However, Superintendent Ed Musgrove assured the board that if the district didn't reach 2 percent next year, it wouldn't be taken under state control, but would remain on the watch list.
In September, Musgrove told the board that he planned to make an additional $600,000 in cuts to the $38 million budget. The district is expecting a one-time payment of $500,000 for broadband communication services by June 30, 2007 that will be budgeted for contingency. However, Musgrove said that even with this payment, the board might still end up with a contingency that is less than 2 percent.
Clark also detailed areas of the budget where expense cuts were made, mainly from those areas where the money hadn't been used in a few years, she said. She also showed the board how much of the allotted money remained in each of the areas of the budget.
The board approved the amendments to the budget, as well as procedural guidelines for making budget amendments, as recommended by Musgrove. It also approved "best practice" procedures for regulating school credit cards, district Wal-Mart cards, discontinuing the reimbursement of activity funds, discontinuing all lease agreements at the building level and requiring monthly budget reports by all directors, coordinators and principals for the general fund and food service fund.
The board also voted to postpone adding any new programs that require general fund expenses. Musgrove said although he knows that extra-curricular activities are important to a student's overall experience, he also believes that the board needs to get a handle on the district's finances before starting any new programs.
"I don't think we should talk about starting new programs because we don't have the money to support them right now," he said.
The amount of money allotted for travel was also discussed, and the board fears that the budgeted amount is too small going into a heavy travel season for sports.
Board chairwoman Judy Hicks said she was uncomfortable with the fact that the travel budget is quickly depleting and that the contingency the board currently has is not enough to cover projected travel expenses. However, she told Clark that it was "very helpful" that she presented the board with a detailed report.
"Our goal is to turn the budget into something we can look at and understand," Musgrove said.
In other business, the board performed the following action:
â?¢ approved a trip for the George Rogers Clark High School girls' basketball team to travel to the Fifth-Third Prime Time Classic at Lexington Catholic for Dec. 20-23, voting to cover one round trip for the bus.
â?¢ approved a trip for the GRC baseball team to travel to the Panama City Beach Invitational in Panama City, Fla., March 31 through April 7.
â?¢ approved trips for the GRC softball team to travel to Middlesboro and Gatlinburg April 3-7, Meade County on March 30 and Bowling Green May 4.
â?¢ approved a senior class trip to New York City March 27-31.
â?¢ approved a one year math recovery grant for Shearer Elementary School.
The next regular board meeting will be Dec. 18 at 7 p.m. at the board of education offices, 1600 W. Lexington Ave.