May 18, 2012Webster Groves School Board got some positive budget news at its meeting on Monday when District CFO Diane Moore presented an updated version of the current year's budget, as well as a draft of figures for 2012-13.
Moore reported a 2.5 percent growth in property tax revenue for 2011-12, which was an unexpectedly positive development. Property tax revenue generates approximately 70 percent of the school's budget. Total revenues (including debt service) for 2011-12 are anticipated to be $59.1 million. Total operating revenues are anticipated to be $54.4 million.
The district conservatively projected no increase in property tax revenue for the 2011-2012 school year, based upon the past few years of property tax collections.
"We have had a decline in assessed valuation annually since 2007-08. I'm hopeful that this is a good sign for WGSD that valuations are coming back up," Moore said.
The district creates its budget around a five-year planning cycle, which was developed to help avoid asking for frequent tax levies.
The district projects revenues and expenses for a five-year period and then asks voters for a tax levy if needed. If the levy passes, the district uses the increased revenues to build a fund balance for the first two years. Officials work to break even in the third year and then use the fund's balance to cover any expenditure increases during the fourth and fifth years.
The current school year was the second of a new cycle following the 55-cent tax levy approved in 2010. The district anticipates adding $2.9 million to the fund balance through the end of its fiscal year. The final budget will be approved at the board's meeting on June 25.
The board also reviewed a second draft of the 2012-13 budget.
Even though next year should be a break-even year in the funding cycle, the budget projects a surplus of approximately $620,000 based on a .5 percent increase in property tax revenue. The district anticipates a 3.3 percent increase in operating expenditures and 5 percent decrease in state funding.
"Every year we keep tightening our belt and will continue to do so because that's good stewardship," Moore said. "Chances are that expenditures will come in a little less, probably under the 3.3 percent increase.
"That's pretty amazing when you think about a budget the size of ours and consider rising costs that we don't control such as utilities, consumables, gas and food prices, health insurance," she added.