COLUMBIA — Nearly every year, Columbia Public Schools has stashed away its unspent money into one big fund, known as reserves, which are used to pay for one-time expenses, unexpected costs or planned deficit spending.
This year, the Columbia School Board reached into that fund for $10.3 million it did not have in order to hire 70 new employees and raise teacher salaries.
But the district can’t keep dipping into those reserves, so it is looking for other ways to find the cash to keep paying its new employees and maintain salary increases.
Searching for the additional $10.3 million, the board has asked people who live in the district to approve a 54-cent tax levy increase in April, which would bring the amount they pay in property taxes to $5.21 per $100 of assessed valuation on property such as homes and cars.
If voters don’t approve the increase, the district will find the money by making cuts. And even if the levy increase is approved, the district has pledged to cut $5 million a year, somehow.
The money could be found in any number of ways, including: reducing employee health benefits; shortening the number of paid working days for teachers; or delaying the purchase of new computers. The board will make those decisions soon, most likely at its work session at 6:30 p.m. on March 20.
A cut-free way to find some of that $5 million is to change how the district gives out money to its various departments each year. Linda Quinley, director of business services, said that change will save about $2 million a year. It comes down to finding a dollar here, a dollar there, by budgeting more accurately.
If the district really can find that much money, that would mean the board would have to cut only $3 million.
The district has asked employees to submit ideas about how it can find that money. So far, Quinley said, each of the 60 or so ideas she’s received would save anywhere from $100 to almost $1 million.
Saving $2 million through a change in budgeting would be large by comparison, but it appears it would be relatively painless. Quinley said the extra money can be found by having departments — such as Vocational Instruction, Student Athletics or Elementary Instruction — submit budgets for supplies, travel and employee training. Then the district would dole out the money accordingly. The district would have more of a line-item budget, in which department costs would be examined individually.
In the past, departments have received across-the-board percentage increases to cover the coming year’s higher costs. District leaders would set those percentages each year. Under the proposed change, departmental leaders would submit individual budgets, so the amount of money they receive would vary based on need.
When the percentage increase was used, more often than not, departments had money left over — and that money went into the reserves piggybank.
“They don’t get to keep it,” said Mary Laffey, director of human resources.
Taking inflation into account, this process has caused reserves to double over the past 11 years, not including this school year. This year’s over-spending shrank reserves by one-third, leaving $26.5 million, or about 16 percent of the district’s annual budget.
That’s roughly what the district aims for. That much money would pay for two months of salaries for all employees if the district, for some reason, found itself without income. The alternative would be to borrow money.
“We didn’t want to put ourselves in a situation to pay interest in order to make payroll,” Laffey said.
If the district were to continue spending its reserves to cover the new costs, that money would dry up in two years, leaving no wiggle room for the unexpected.