Vance, county spar on budget
Loudon County Director of Schools Jason Vance met with Loudon County Commission Monday night in hopes of reaching a compromise on a request for more property tax revenue.
During the workshop, Vance said the Loudon County Board of Education realized increasing property taxes by 18 cents was “unrealistic” and instead asked if 6 cents could be considered.
He acknowledged raising taxes would be a challenging task for commissioners.
“When I think about this, I know I’m not in your positions and I don’t mean to sound like I know what you think about, you’ve got a lot of things to consider thinking about a whole county’s budget, but this is really the year if we’re ever going to raise taxes to do it and do it in a way that’s powerful for years to come,” Vance said.
According to a document presented by Vance, 6 cents would generate about $984,000 in property taxes. Of that portion, the county schools would receive 65 percent, totaling $640,000, while Lenoir City Schools would receive the remaining 35 percent at $344,000.
“So you’re looking for $640,000 on a $37 million budget?” Henry Cullen, county commissioner and Loudon County Budget Committee member, said. “I guarantee you if you went through there line by line, you could find 640. We found 840 without breaking a sweat. That’s where you got to start looking. Start looking in your budget. You won’t have to touch your fund balance.”
The BOE’s proposed 2015-16 fiscal year budget is $37.7 million with a projected $2.1 million budget deficit. Last year’s budget of $36.5 million resulted in a revenue shortfall of about $1.5 million.
Vance said the county provided about $13.3 million for last year’s budget, and the BOE would like to boost that number to $15.5 million for the coming fiscal year “in order to move forward in a positive direction and continue to not have to dip into fund balance.”
“Now your position is that we’re eating into our fund balance, but the fact of the matter is undisputable, unrefutable that in the last five years you all — now I don’t — take away anything you want to take away, however you want to — you all have added nearly $5 million to the fund balance,” Van Shaver, county commissioner and budget committee member, said. “That can’t be fluffed away. It’s a fact, it’s in the audits.
“Whether you want to call it $8 million or you started out five years ago with zero and now you have five, you all have added $5 million, nearly 4.8 something to your fund balance,” he added.
According to the proposed BOE budget, the fund balance will be at about $4.6 million at the start of the fiscal year. The balance for the 2014-15 fiscal year began at $6.1 million.
Vance said if no new money is added, the BOE could eventually see a fund balance fall to $2.5 million.
“As of 2:30 (p.m.) today, with two weeks left in this year, you all are still $919,140 away from your projected expenditure budget, with two weeks left in the fiscal year,” Shaver said. “So, again this year, you will not spend — and you said this many times — you’re not going to spend your entire budget. That’s good, we’re the same way. But when you throw out the 1.5 or 1.6 that you’re going to burn, that’s just not a true number.”
Vance said he wouldn’t refute Shaver’s remarks.
“When we consider our budgets, we consider them at a 97-98 percent revenue portion and we don’t always expense all of that,” Vance said. “As a matter of fact, it would probably be bad business if we expensed 100 percent of it. You would be cutting way too close to the line, especially with a $37 million budget.
“So Van, I agree with what you’re saying, but I’m saying is while we have built up a big fund balance, we have started to expense into that fund balance, especially last year and this year,” he added.
Vance said eating into the fund balance over the next couple years would prevent the school district from providing “the same level of educational opportunities” as in years past.
Shaver said the decision to take out of the fund balance falls on the school board’s shoulders, not commissioners.
Loudon County Mayor Rollen “Buddy” Bradshaw asked Vance what was the BOE’s No. 1 priority.
“If you don’t have a good base for your teachers, if you don’t have a good system in order to make sure that you’re getting the very best people to educate your kids, then you’re just going backwards,” Vance said. “So I think that when you consider what’s the most important, probably your teachers.”
Commission will hold a public hearing at 6 p.m. Monday at the Loudon County Courthouse Annex for residents to discuss items on the budget. The Budget Committee will hold a meeting at 4:30 p.m. June 24 at the county office building, and commissioners will vote on the county’s overall budget for 2015-16 fiscal year at 6 p.m. June 29 at the county office building.