Supervisors question emergency money built into school budget

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Supervisors question emergency money built into school budget

Wednesday, Mar. 17, 2010 by .(JavaScript must be enabled to view this email address) | 4 comments | Email this story

Each year, both the county and school system include funds in their budgets considered an overage, used in case of emergency.

For the school system, that $20 million—about 2 percent of the overall budget—came into question March 10 as supervisors scrutinized proposed school spending for fiscal year 2011.

Supervisor Sally Kurtz (D-Catoctin) called the fund “a running $20 million slush fund” before later apologizing for the remark.

On March 11, members of the Board of Supervisors and School Board got together to discuss the fund balance issue.

“The School Board budgets with a small degree of flexibility to be fiscally responsible,” said Chairman John Stevens (Potomac). “Reducing that budgeted amount would put us at risk for handling contingencies that may come up throughout the year.”

Stevens said it is standard practice for the school system to over-budget, and the county does the same thing each year in its budget in case of emergency.

At the end of the year, if a fund balance remains, it is traditionally carried over into the next year’s budget and used for a one-time expenditure.

Last year, the county government took back millions from the school system’s fund to fill a $28 million hole in the budget.

Supervisor Jim Burton (I Blue Ridge), who heads the finance committee, said he doesn’t understand what the controversy over fund balance stemmed from.
“I have no problem with a reasonable fund balance,” he said. “We’re manufacturing a problem that really isn’t there.”

Stevens said he wanted to address the issue publicly to ensure that everyone understands the way the school system prepares its budget and why the extra overage is needed.

“The fact is that everyone recognizes the financial pressure the county is under, and if it were just a statement made that the schools had $20 million in carryover that would be fine, but those kinds of statements come with disparaging remarks that question the fiscal management of the school system,” he said. “It contributes to civil discourse and problems with the management of the county and school system.”

Stevens said he hopes the two boards can work together productively on the budget going forward.

Contact the reporter at .(JavaScript must be enabled to view this email address)

Comments

Thu, Apr 22 at 06:07 AM by Mark | car insurance claim

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Mon, Mar 22 at 07:50 AM by Jose | Report this comment

There are no cookie cutter solutions for administering public finances. However, there are two areas you cannot mess around with: health and education. In those areas, you have to bite the bullet, fund them properly and move on. You can mess around with everything else.

Thu, Mar 18 at 05:29 PM by Loudoun Taxpayer | Report this comment

The fact is that the school budget has been overfunded every year since FY01 and a whopping $56 million fund surplus - $49 million of which is unreserved - had been amassed in the school board general fund at the close of FY09! In addition, the county general fund had about $140 million in reserve that at the end of FY09 could be transferred to the school board fund in the event of a contingency. It’s good fiscal policy to keep a reserve, but this is hoarding taxpayer money! Ms. Kurtz’s description of a slush fund is pretty accurate and her motion to get rid of it is appropriate. They should look at transfering some of this surplus over to the capital projects fund to finance new schools.

Wed, Mar 17 at 05:38 PM by 4truth | Report this comment

Finally the veil is being lifted. John Stevens says the LCPS budget with little flexibility so that they are fiscally “responsible”, then he says they over budget—then he says they use the contingency fund for one time purchases each subsequesnt year. Hatrick says this has been going on as long as anyone can remember—20 million each year for 30+ years is a whole lot of discretionary funding!! Many organizations simply carry over the contingency fund and eliminate the need to continually fund it! You can’t do that if you view it as a potential lump sum freebie.

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