November 18, 2006
A bit of Sunshine on the Madison School District's Budget Process: 2006/2007 Madison School District Budget & $6M "Structural Deficit" Discussions
"Why did our equity go down this past year since we, the board, passed a balanced budget in 2005/2006? Why did it go down by $2.8M (about a 1% variance in last year's $319M+ budget)?Art Rainwater:
"The way we have attempted to deal with maintaining the quality of education as long as we could was to budget very, very aggressively, realizing that we had an out of fund balance ($5.9M in 2006/2007). We made the decision 7 years ago or so to budget aggressively and try to manage to that budget believing that we would use less fund equity over time than if we set aside a set amount. So that's been our approach. That fund equity has now come down to the point that we believe we can't do that any more and we will not bring you a balanced budget that is aggressive particularly where it gets into aggressive on the revenue side in how much efficiency we believe we can budget. So, what the effect of that is to increase the amount you have to pay.Lawrie Kobza:
We budgeted under this CFO/COO account, we budgeted that we were going to find $6.1M somewhere without saying where, and we didn't. We found all but 2.7M of that. In this year's budget, we have the same type of thing. We have budgeted that we're going to find $5.9M somewhere. So, while we can look at all of our budget items, oh, we're doing great we're right on budget for salaries, transportation, for whatever. We can't just meet our budget, we have to do $5.9M better than our budget. We're going to take this up in the Finance committee to see if there is a different way we can present some of this, to be able to track it.Roger Price mentioned that this was not a new item, but was in place when he arrived in the mid 1990's.
Ruth Robarts asked about a February 2006 consultant's forecast of the District's equity versus Roger Price's Numbers (52 minutes). Ruth also asked about the financial implications of the District's retirement buyout commitments through 2009. "I've been on the Board a long time and did not see in the documents I've seen that kind of structural deficit".
Watch the video here or listen to the mp3 audio.
The good news regarding the budget's "Fuzzy Math, or the balanced budget that isn't" (there must be some)? The discussion happened publicly, on MMSDTV, and the community is now aware of looming larger budget changes than we've seen in the past. Unfortunately, I've seen no mention of this in the traditional media.Posted by Jim Zellmer at November 18, 2006 6:18 AM
Subscribe to this site via RSS/Atom: Newsletter signup | Send us your ideas