Unless it gets some unexpected revenue, Francis Howell will be losing money for the 2012-13 school year.
The Howell Board of Education voted on June 21 to approve the proposed budget for the ensuing school year. According to budget documents, Howell is facing a deficit of nearly $2.4 million in the operating funds. The budget passed with a 5-1 vote. Board member Eric Seider was absent from the meeting and board member Mike Hoehn voted against the proposal.
"It's very difficult to accept the budget with deficit spending," Hoehn said. "Its not balanced at all."
The vote on the budget ends . Chief Financial Officer Kevin Supple has been telling the district for some time that deficit spending would be in the future unless revenues improved. It was thought that the 2011-12 would be that year, but enabled the district to operate in the black this year. That won’t be the case this year unless, again, Missouri tosses more funds at the district.
With property tax collections on the decline and the district receiving fewer funds from state and federal sources, the operating budget came up short for the new school year.
Supple's projections call for $170,195,609 in revenue from a variety sources for the 2012-13 year. On the other side of the ledger, expenses are projected to reach $172,109,825. A $400,000 transfer to the capital funds put the budget at $2,314,216 in the red.
The end result of the deficit cuts the general fund reserves to $38,031,060.
Based on the approved budget, the district is projecting its total fund balance to sit at $63.1 million—down $20,195,755 from the beginning of the year. A large chuck of significant loss, however, is because of bond funds. Budget documents report that $16.1 million the deficit is attributable to bond proceeds and is restricted for specific construction purposes.
The budget paints a fairly bleak prediction for the future. With expenses projected to rise at a rate not on par with expenses, the general reserve fund balance is slated to be just $4,192,701 at the end of fiscal year 2015-16. Board member Mike Sommer said he was certain the cash flow issue would be addressed before things got that bad.
"This is a very conservative budget," Sommer said. "This is nowhere close to where we’re going to end up."
The budget vote was just part of end-of-the-year tasks for the board. At 7 p.m. on Thursday, June 28, the board will hold a special meeting to finish up things from the 2011-12 year as it prepares to start the new year on July 1