Fairfield school board to discuss budget cuts Feb. 19

FAIRFIELD – The Fairfield school board is faced with some tough choices this budget session as it seeks to trim $1 million in expenses next fiscal year.

Next year’s budget will be the focus of the board’s meeting on Monday, Feb. 19, where it will review the proposed changes from a budgeting committee of stakeholders that looked into which expenses the district could cut and which ones it could not. Fairfield school board President Tai Ward said the committee consisted of 21 people who looked at every budget item and categorized it as “core,” meaning the district legally had to provide it, or “additional,” meaning it did not.

Ward said that some of the district’s expenses have their own funding stream so cutting them doesn’t help the district’s budget since it would also lose the source of revenue that funds the program. For the expenses that do not have their own funding stream, the committee ranked them in order of importance, and eventually settled on cutting a list of expenses that would save the district $1.1 million in its general fund.

STAFFING CUTS

The difficult part for the school board is that cutting such a large sum from the district’s $27 million budget will necessitate staffing cuts, since personnel expenses account for about 80 percent of the general fund.

“It would be impossible to cut $1 million without cutting staff,” Ward said. “This is going to affect a whole lot of people. We know we’ll hear feedback about the positions that would be eliminated, because their work is going to have to go to someone else.”

Ward said the complete list of staffing cuts is still being finalized, but the proposal called for eliminating the equivalent of 11.5 fulltime staff.

The board will try its best to limit the effect of the budget cuts on the students, Ward said. For instance, he noted that the committee looked at the prospect of eliminating the $9,000 budget for boys and girls high school swimming.

“We agreed as a board that cutting students’ activities is no way to fix the budget,” Ward said. “For those kids, swimming might be their only extracurricular.”

FINANCIAL PICTURE

The school board has known for months that significant cuts were going to be needed this year to get the district’s finances back on track. In the fall, Interim Superintendent Stephanie Mishler reported that the district had overspent its revenues by $1.3 million the prior school year, and that it was expected to overspend its revenues by $1.4 million next fiscal year, based on a model created by the Iowa School Finance Information System.

The board got a clearer picture of its financial situation in December through a work session with Larry Sigel, an expert from Iowa School Finance Information Systems (ISFIS). Sigel recommended the board pursue near-term cuts of $800,000 to $1.6 million. He said that, if the school made no cuts, it might be required to appear before the School Budget Review Committee and supply a plan about how it would “right the ship.”

“If a district is not positive by year three, they could be subject to being closed,” Sigel told the board in December. “It’s just an unpleasant process. It doesn’t just bring a financial review to the school district; it also triggers a full accreditation review. It’s nothing to mess around with.”

Ward said the financial projects the board looked at showed that it would probably need to cut $1.7 million over a three-year period, so he expects the board will have to cut expenses again in the next two years.

“Hopefully, we can find things that are non-personnel,” Ward said.

TAX LEVIES

The board is planning to eliminate one of its tax levies, the School District Management Levy, which pays for early retirement for teachers and some insurance costs like property insurance. That levy is now $0.45 per $1,000 taxable valuation, but Ward said the district plans to reduce it down to zero.

Ward said board members are hopeful that Fairfield voters approve an increase in the Physical Plant and Equipment Levy (PPEL) on March 5. The voter-approved PPEL is now $0.67 per $1,000 taxable valuation, and the district is asking voters to increase it to $1.34 per $1,000 taxable valuation, which is the maximum allowed by the state. Ward said most of the schools around Fairfield are already at their PPEL maximum levy, and Fairfield wants to be able to match them to keep up with “needed renovations, updates and getting everything up to code.”

“When you have aging buildings, you have to spend more money on upkeep,” Ward said.

Ward said that the district’s current voter-approved levy is not enough to cover building expenses that should come from PPEL, so the district is having to divert money away from its general fund. He said that if voters approve the increase to the PPEL this March, it would free up money in the general fund and could save one or two teacher salaries.

Even if voters approve the PPEL increase in March, Ward said Fairfield would still have one of the lowest levies in the state. According to the Iowa Department of Management, Fairfield’s tax levy for fiscal year 2024 is $10.59 per $1,000 of taxable valuation, which is below neighboring school districts such as Mt. Pleasant ($13.17), Washington ($16.01), Pekin ($12.88) and Cardinal ($15.64). Ward said that Fairfield’s levy is not only well below the state average of $13.20, but it’s also much lower than it was a decade ago when it was $15.50.

“It’s gotten lower because we’ve paid off our debt,” he said. “But I also believe that the state of our facilities reflects the lack of investment. Through this PPEL and possibly a general obligation bond, we can start investing more into our school buildings.”

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Call Andy Hallman at 641-575-0135 or email him at andy.hallman@southeastiowaunion.com