Belcher presents budget scenarios to Columbia School Board

COLUMBIA — Without an increase in Columbia Public Schools' property tax levy, the district will be running a deficit of more than $14 million in five years, according to projections Superintendent Chris Belcher showed Columbia School Board members Thursday morning.

Although the board didn't decide at its work session whether to seek a levy increase, the projections offered by Belcher make a compelling case. The combination of rising enrollment and declining state and federal aid is creating a budget crunch that the district simply can't ignore.

As the board works to finish a budget for the 2011-12 academic year that's estimated to be a little more than $156.2 million, Belcher presented a number of  different scenarios for each of the next five budget years. These scenarios include:

• Adding $800,000 to the 2011-12 budget to reduce class sizes.
• Implementing a 60-cent tax levy increase in 2012-13.
• Implementing a 60-cent tax levy increase in 2013-14.
• Adding $800,000 to reduce class sizes to the 2011-12 budget and implementing a 60-cent tax levy increase in 2012-13.
• Adding $800,000 to reduce class sizes in 2011-12 and implementing a 60-cent tax levy increase in 2013-14.
• Adding no new revenue or expenses.

Under the current budget plan, the district would have enough revenue to cover expenses next year. In 2012-13, however, the district would be looking at a nearly $2.5 million deficit, which would continue to increase to more than $14.2 million by 2015-16.

To cover expenses the district would have to dip into its reserve fund, which now stands at $35.6 million. With no levy increase, reserves would fall to $1.5 million, or less than 1 percent of the district budget. The district normally tries to keep reserves at about 16 percent.

"We must show the public the long-term," Belcher said of the projections, but he emphasized that he is not yet proposing a levy increase.

The district's current levy is $4.69 per $100 assessed valuation. A 60-cent increase would cost the owner of a $100,000 home an additional $114 per year. The owner of a $1 million commercial property would pay an additional $1,920 per year.

Any increase in the tax levy would be subject to voter approval.

If a 60-cent tax levy were implemented in 2012-13, it would bring the district out of the deficit for the 2012-13 projected budget and create more than a $9.5 million surplus. The surplus would remain until 2015-16, when the district would again be facing a deficit of about $2.2 million.

If the 60-cent tax levy were implemented in 2013-14, the district would see a deficit in 2012-13, then two years of small surpluses before returning to a deficit scenario in 2015-16.

Board members agreed that one of the most important steps as they consider asking for a levy increase is to educate the public about how the district would use the money.

"I know you're not obligated by law to say it is for this, this and this," board member Jan Mees said. "It is important for the public to know this is how we are going to spend this money."

Board member Michelle Pruitt agreed. "It demonstrates to the public that we have a plan, not backing ourselves into the corner," she said.

Board member Jim Whitt said the public must trust that the board has done its homework, looked at different scenarios and educated the public on future expectations.

"We don't want to say we hit this one year and come back next year and surprise them with a bond issue," Whitt said, adding the board should develop a comprehensive financial strategy.

Belcher encouraged the board to continue asking questions and making suggestions on how to address the budget situation. He said the board is a long way from deciding whether a levy increase is appropriate or whether it can create workable budgets with existing revenue.

"We can always do better," Belcher said.