Tuesday, Oct 16, 2018
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Mark Reiter

Bedford schools' deficit could balloon to $7M

Governor's budget seeks $3M cut in funding



Bedford Public Schools Superintendent Ted Magrum


TEMPERANCE -- The $4.6 million deficit facing Bedford Public Schools for next school year could grow to as much as $7 million under Gov. Rick Snyder's proposed budget.

Superintendent Ted Magrum said the suburban Toledo school district stands to lose more than $3 million in the governor's spending plan that calls for a 4.1 percent cut in K-12 education funding.

Even before the proposal was unveiled, the school district already had decided to close Smith Road Elementary and redistrict the four elementary schools to help offset a projected $4.6 million deficit in June, 2012.

Bedford and other pubic schools districts would get $470 less in state funding for each student enrolled, dropping Bedford's per-pupil allowance to $6,846 for the 2011-12 academic year.

"What came out of governor's proposal was very challenging for school districts," Mr. Magrum told an audience of about 40 people who attended last week's school board meeting.

Governor Snyder wants to create a new State Education Funding Act that uses State School Aid Fund revenue, as well as general fund revenue, to pay for the state's education system all the way through to higher education.

The recommendation that sends shock waves through school officials, including Mr. Magrum, is the plan to include K-12 education, higher education, and community colleges in the same budget. Currently, K-12 education is funded separately from higher education.

"The intent was always to fund K through 12 and not K through 20. That change alone is going to take out $896 million out of the School Aid Fund, which [is the] equivalent to $578 per student. That for us is close to $3 million," Mr. Magrum said.

The decrease in per-student funding coupled with a lack of federal stimulus money that the state used this year to offset cuts will mean nearly $2.5 million less going into Bedford School coffers. The district's financial situation also is compounded by forecasts that enrollment will drop 120 students, accounting for an additional $821,520 reduction in state money.

Bedford Schools, like all districts, is all facing increased costs, including utility, borrowing costs, fuel and insurance. An unexpected increase in retirement rates that the district pays in the state pension system is expected to cost an additional $995,000. The retirement rate is expected to increase from 20.66 percent to 24 percent, costing school districts about $230 per pupil.

Overall, Bedford Schools will end the fiscal year in June with about $150,000 in its rainy-day account, and will begin school in September with one less elementary and sixth graders at the junior high, accounting for an estimated $800,000 less in operating costs.

"That leaves us overspending approximately $6.4 million and a negative fund equity balance of $6.2 million," Mr. Magrum said. "Now we are looking over $6 million to balance the budget, which is basically 15 percent of [the $45 million] budget cut in one year. How do you do that?"

The proposed budget cuts could translate into nearly $3 million decrease in state funding for Monroe Public Schools. Like Bedford, it would get $470 less in per-pupil funding under the proposed budget.

The school district closed buildings and consolidated elementaries two years ago. Last year, school officials restructured the administration, instituted health insurance changes for its unionized employees, and privatized some janitorial staff operations.

Ken Laub, assistant superintendent of business, said the district should end the fiscal year in June with a $400,000 surplus in revenue compared expenditures and $3.2 million in its rainy-day account. The recommended changes from Governor Snyder would nearly wipe out that savings. The expected increase in retirement rates would cost the school district an additional $1.1 million.

Whiteford Agricultural Schools, the smallest district in Monroe County, could lose about $340,000 in state funding. Superintendent Larry Shilling said that more than $750,000 in cuts in staffing and operations have been made since 2009.

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