The Richmond Register

Local News

January 25, 2014

Draft budget reflects additional costs, but no new revenue

Madison County Schools

RICHMOND — Additional personnel costs in Madison County School’s 2014-15 draft budget, mostly related to full-day kindergarten, will require slightly more than $1 million from the district’s contingency fund.

The school board Thursday approved 5-0 a first draft of a budget that would reduce the district’s $5.67 million unreserved balance to $4.65 million.

“There’s lots of (expense) additions in here, but really, with no corresponding increase in the revenue side,” said Debbie Frazier, the district’s chief finance officer.

A better understanding the 2014-15 draft budget can be obtained by looking at modifications in revenues and expenditures in the 2013-14 working budget.

2013-14 working budget

Frazier anticipates the district will receive an additional $700,000 in state funds on top of what was forecast in the current-year budget, for a total of $38.7 million.

These funds, called Supporting Education Excellence in Kentucky (SEEK) are based largely on a district’s Average Daily Attendance (ADA) and local property assessments. School funding from the local tax base is generated through real and personal property taxes. With the SEEK formula, the more revenue produced locally, the less a district receives from the state.

As Frazier has said on several occasions, “when property assessments go up, SEEK money goes down,” and vice versa. 

However, “our property assessments were probably the lowest I have ever seen since I’ve been here,” Frazier said Thursday.

Additionally, when the board looked at the current-year budget in September, the number of students enrolled appeared to have increased. But the final enrollment tally and ADA “far exceeded projections” with 191 more students, Frazier said.

The decrease in property values coupled with the increase in student enrollment caused a spike in SEEK money.

And if Gov. Steve Beshear’s budget proposal is approved, which allocates $188.9 million in SEEK funding over two years, Frazier said Madison County Schools could gain $1 million in 2014-15 revenues.

However, the governor’s proposal also includes a 2-percent salary increase for teachers and classified personnel in the first year, which would essentially absorb the $1 million in additional revenue, Frazier said. Beshear’s plan includes a 1-percent salary increase for personnel in the second year as well.

Frazier reminded the board that $38.7 million was still an estimate, and that the final receipt will not be affirmed until April.

The amount budgeted from federal Medicaid reimbursements also was adjusted.

“Medicaid is the gift that just keeps on giving,” Frazier said. The item had been $125,000 in the current-year budget, but is now projected to be nearly $250,000. Although revenue generated from property taxes will continue to be collected through April, Frazier said the $17.4 million budgeted for the current year is “right on target.”

Omitted property taxes and revenue from state audits was $30,000 over budget. However, this revenue source is unpredictable, Frazier said, so only $75,000 is again anticipated for the new-year budget.

“We never know what we’re going to get; there’s really no guarantee of getting anything,” she said.

In total, the receipt budget was increased by $975,000, she said. This additional revenue will cover most of the $984,908 spent on 10 new buses in the fall; $950,000 had already been set aside for this purchase in 2014-15.

“We ought to be able to comfortably pay for those buses out of current-year funds,” said Frazier, and end the 2013-14 year with a $5.67 million unreserved balance, as maintained in the past.

She recommended the untapped set-aside funds of $950,000 be used to purchase 10 more buses. That is the number of buses that should be purchased each year to keep up the fleet, she has said on several occasions. No buses were purchased in 2012-13.

2014-15 draft budget

The draft budget is “our first formal look at where we are for next year,” said Frazier, and is “the first of three budgets.” It is revisited in May and again in September. 

Frazier made no changes to the amount budgeted for property tax revenues, which remains at $17.35 million. The amount could increase if in August, the board chose to adopt a property tax rate that generated a 4 percent increase in revenue.

The board voted against an increase in 2012. However, it voted in favor of an increase in 2013 to generate nearly $1 million, which Superintendent Elmer Thomas promised would be used to help fund all-day kindergarten.

Later in the meeting Thursday, board member John Lackey asked Frazier to further explain SEEK funding. He also asked how the property tax rate, set by the school board, affects the formula.

Frazier said the SEEK formula is “based on the assumption” that boards will set a tax rate to generate the maximum revenue increase of 4 percent.

So if one year, a district does not set a higher property rate, yet it generates more funds through higher property assessments, it will still lose SEEK funds, she said. “The district is really losing on both ends there. When you don’t take the 4 percent, you can never recoup that.”

Expenditures reflect several personnel changes in the 2014-15 budget, mostly related to the implementation of full-day kindergarten.

Not including employee benefits or other instruction expenses, there is a more than $1 million jump in personnel expenses from $32.6 million in the current-year to $33.7 million in the 2014-15 draft budget.

This includes the addition of 13 kindergarten teachers and 15 para-educators, along with two instructional para-educators, if needed, and part-time teacher at the Mayfield kindergarten academy.

The academy will require a part-time custodian. And with double the number of kindergarteners, six additional bus drivers may be needed at a cost of around $94,000, Frazier said.

The budget also reflects the customary 0.5 percent salary expenditure increase, around $250,000, in teacher’s step raises (for years of service) and rank changes (for educational attainment), but no across-the-board pay increase for staff.

Pending legislation on the percentage of classified staff retirement for which the district is responsible may generate a savings of $110,000. Already approved by the Kentucky Retirement Systems board, the percentage of 18.89 could decrease to 17.67 if approved by the General Assembly, Frazier said.  

But while the district will pay less for classified staff retirement, it will pay more than double the amount for certified staff retirement.

The certified retirement rate is 1.5 percent this year, but will be 2.25 percent next year, which will be an additional cost of $280,000, Frazier said. In 2015-16, the rate will rise to 3 percent.

The instruction supplies budget will increase by $195,000. Last year, districts were permitted to reduce supply allocations to each school. But with the anticipated increase in SEEK funds, said Frazier, the short reprieve may be over. 

Further discussion is needed on how the district will continue to fund the nursing program, she added. In May, the board voted to hire 11 nurses to staff its schools, but chose a funding option that would draw $204,300 from the general fund and $250,000 in federal Title 1 funds.

However, some of those federal funds had been carried forward and will not be available in the coming years.

Title 1 funds are “drying up,” Frazier warned in May.

The district would need to dip further into the general fund to maintain the nursing program, she said.

Crystal Wylie can be reached at or 623-1669, Ext. 6696.

Text Only
Local News
  • May 30 last school day for students

    After 16 snows days and two weather delays this winter, the Madison County School Board decided Thursday to end the school year on Friday, May 30.

    April 19, 2014

  • 4-19 TechExtra1.jpg Students showcase projects in Technology Extravaganza

    Madison County School students showed off just how tech savvy they can be during the district’s sixth annual Technology Extravaganza on Thursday at Madison Central High School. After the showcase, more than 350 students were honored for their work.

    April 19, 2014 7 Photos

  • 4-19 SchoolBoardJesseWard.jpg Ward honored for service; tech center named after him

    Retired Madison County educator Jesse Ward was recognized Thursday for his many years of service. To honor him, Superintendent Elmer Thomas announced the board’s decision to rename the district’s technology training center on North Second Street in Richmond the Jesse P. Ward Technology and Training Center.

    April 19, 2014 1 Photo

  • 4-19 Brian Smith.jpg Berea man indicted on 24 child porn counts

    A Madison grand jury has indicted a Berea man on 24 counts related to child pornography.

    Brian J. Smith, 26, is charged with four counts of distribution and 20 counts of possession of matter portraying sexual performances by a minor.

    April 19, 2014 1 Photo

  • 4-19 Gregory Powell.jpg Police apprehend burglary suspect

    An observant witness was able to help Richmond police catch a burglary suspect shortly after a break-in Thursday afternoon on Savanna Drive off Berea Road.

    April 19, 2014 1 Photo

  • 4-18 PackTrack1a.jpg Walkers, runners of every age ‘Pack the Track’

    Waco Elementary and Model Laboratory schools students raised more than $8,000 (and counting) for the annual Pack the Track event at Eastern Kentucky University’s Tom Samuels Track Thursday, said Kim DeCoste of the Madison County Diabetes Coalition.

    April 18, 2014 14 Photos

  • 4-18 George WilliamsWEB.jpg Suicide attempt fatal for inmate

    A Todd County man died Tuesday at a Lexington hospital following a suicide attempt at the Madison County Detention Center, according to Madison and Fayette county officials.
    George Kenneth Williams, 50, of Allensville, was transported Monday afternoon by Madison County EMS to Baptist Health Richmond, according to EMS Director Jimmy Cornelison. He was then transferred to Baptist Health in Lexington where he died Tuesday, according to the Fayette County Coroner’s Office.

    April 17, 2014 1 Photo

  • CCDW instructor indicted on charges of failing to provide training

    A Madison County grand jury has indicted a carry-concealed weapons permit instructor on charges he falsely claimed to have provided instruction to one person for a CCDW permit and provided incomplete training to three others.
    Christopher D. Fins was indicted April 9 on one count of CCDW instructor not providing firearms training and three counts of providing incomplete firearms training.
    Fins faces up to 20 years in prison if convicted of all four felony charges.

    April 17, 2014

  • EKU dorm sprinklers may have been activated maliciously

    Fire-suppression sprinklers went off about 2:30 a.m. Thursday in Eastern Kentucky University’s Martin Hall dormitory, prompting its evacuation.
    Fluctuating pressure then caused a campus water main to break, according to EKU spokesperson Mark Whitt.
    The cause is uncertain, but university officials are investigating to determine if the sprinklers were activated maliciously, Whitt said.
    The residence hall houses 260 students who were placed in other university housing or stayed with friends. All were able to move back in later in the day, he said.

    April 17, 2014

  • Sixth person charged in motel meth bust

    A sixth person has been charged in connection with a methamphetamine-making operation discovered last week at the Bel Air Motel in Richmond.
    Roger M. Million, 24, Moberly Road, was charged Wednesday with manufacturing methamphetamine.

    April 17, 2014

AP Video
Captain of Sunken SKorean Ferry Arrested Raw: Fire Destroys 3 N.J. Beachfront Homes Raw: Pope Presides Over Good Friday Mass Raw: Space X Launches to Space Station Superheroes Descend on Capitol Mall Man Charged in Kansas City Highway Shootings Obama Awards Navy Football Trophy Anti-semitic Leaflets Posted in Eastern Ukraine Raw: Magnitude-7.2 Earthquake Shakes Mexico City Ceremony at MIT Remembers One of Boston's Finest Raw: Students Hurt in Colo. School Bus Crash Raw: Church Tries for Record With Chalk Jesus Raw: Faithful Celebrate Good Friday Worldwide Deadly Avalanche Sweeps Slopes of Mount Everest Police Arrest Suspect in Highway Shootings Drought Concerns May Hurt Lake Tourism Vermont Goat Meat Gives Refugees Taste of Home Calif. Investigators Re-construct Fatal Bus Cras Mayor Rob Ford Launches Re-election Campaign Appellate Court Hears Okla. Gay Marriage Case
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide

Should the Richmond City Commission stop rezoning property to allow construction of apartments?

     View Results