Valley View Budget: 'It's Not Great News, But It's Not Bad News'

Valley View board of education members got a look at next fiscal year’s financial outlook Monday night.

Saying the district is ‘holding its own,’ Assistant Superintendent for Administrative Services Gary Grizaffi presented a proposed overall budget of $246.9 million for 2011-12, virtually the same as the actual spending for the previous year.

Grizaffi called the zero percent increase “pretty remarkable,” considering the salary increases that were the result of collective bargaining with union employees. Those increases were offset by a 4.3 percent decrease in the cost of health insurance and other benefits, Grizaffi added, noting he expects the district’s benefit costs to continue to decline.

The draft shows a projected $188.5 million in education fund spending, which includes salaries and benefits. Grizaffi said that number represents a .3 percent increase over last year.

As always, the lion’s share of district funding comes from local taxpayers, with $164.6 million, or 69 percent of revenues, coming from property taxes. On paper, the state’s share totals $62 million, Grizaffi said. But that amount includes $24.2 million in on-behalf Teachers Retirement System contributions — money the district will not receive, he explained.

“We’re really receiving $37 million from the state,” he noted. The remaining revenues of about $11.5 million come from federal funding.

Despite tough economic times, fiscal year 2012 will see the return of the district’s capital improvements program, which was put on hold for two years.

Grizaffi said the district’s Buildings and Grounds department has created a five-year plan for projects that need to be completed to keep Valley View buildings in good working order. Roughly $1 million was added back into the capital projects fund this year, Grizaffi said.

Financial losses

The district expects to take a financial hit when it comes to state funding. The state currently owes Valley View $3.9 million for special education reimbursements, and the amount of General State Aid (GSA) doled out to the district is expected to decrease by $2 million this year.

According to Grizaffi, that’s because the foundation level, or the amount the district receives per student, has not increased in several years, resulting in a loss of $6.7 million since 2008.

The state has also slashed the transportation reimbursement to $1.2 million. Since 2009, the reduced reimbursement has caused the transportation fund to dwindle from $7.5 million to $1.7 million, Grizaffi said.

Federal funding, in the form of $3.69 million in American Recovery and Reinvestment Act dollars for special education, was a one-time windfall that will not be received this year, Grizaffi added. Likewise for another $2.08 million from a federal education jobs bill, used last year to retain teachers.

This year’s tax levy, which is scheduled to be approved by the board in December, will also shrink by an estimated $700,000, according to Grizaffi, due in part to a tax cap that limits the amount any taxing body can levy. Slowed-down economic growth in the area has also stifled any revenue increases that could have come from new property taxes, he said.

The good news is that the state has paid down some of its debt in recent weeks, shelling out $466,000 in special education reimbursements.

“The state has until December to pay its bills,” Grizaffi said. “We certainly might see that money before December … If we were to get paid in full by June 30 of next year, that will go right to our bottom line.”

Quigley said the state isn’t doing its part to provide adequate school funding.

“We’ve upheld our end of the bargain,” he said, referring to $22 million in cuts the district has made in recent years.

Hearing, approval set for next month

According to officials, Valley View is in better shape than some nearby districts, which have had to issue tax anticipation warrants to tide them over until local property taxes are received in June and September.

 “It’s not great news, but it’s not bad news,” Quigley said.

“Overall, in terms of our financial health, we’re holding our own,” Grizaffi said.

Board members voted to place the draft budget on 30-day display. The document can be viewed on the Valley View School District website or at the district administration center, 755 Dalhart Drive.

Before the board votes to adopt the budget, a public hearing is set for 7:30 p.m. Sept. 12 during the regular board of education meeting.