Wednesday, Feb. 17, 2010

School system: reserves are dwindling

The school system's cash reserves are dwindling, meaning schools will have a thinner cushion to fall back on in a year when state and county appropriations are likely to shrink.

After setting aside some cash for next year and paying for some big-ticket items, the school system will have about $3.6 million in savings, said Superintendent Ed Croom. "That's a scary number," he said. "We're cuttin' it close."

The schools had nearly $14.9 million in reserves this year, but Croom said they were forced to spend some of that money on projects the state would normally cover but didn't this year. Those include a $563,000 roof at North Johnston Middle and a $152,000 roof at East Clayton Elementary. The state also cut money for textbooks, so Johnston schools are pulling $800,000 from reserves.

Another $3 million in reserves will cover federally funded school programs until federal dollars arrive in the fall, but the school system will get that money back. And more than $1.5 million will help open two new high schools this summer.

About $4.9 million in savings will supplement next year's funding from the state and Johnston County. Also, the school system will pay out $280,000 as part of a state lawsuit settlement with charter schools.

Croom said he's worried about what the next two years will mean for school coffers. Johnston schools avoided layoffs this school year, but costs are rising. Corinth-Holders and Cleveland high schools will open in August for ninth- and 10th-graders.

"If the state situation doesn't get better, I'm not sure we'll have an answer for us as we open the new schools," Croom said.

The school system has spent about 65 percent of the $10 million it received from the federal stimulus package. That money helped save jobs in the system, Croom said.

During a school board meeting last week, board chairman Larry Strickland said he hoped residents realized that schools have "tried to be frugal."

Croom said he had asked departments within the system to cut 5 percent from their next budget requests.

Last week's bleak money talks are surely a sign of what's to come -- asking County Commissioners for cash. This year, schools asked for $57.2 million but got $1 million less than that.

Commissioners Chairman Wade Stewart said the county is facing a tough year amid flat sales-tax and property-tax revenues. "The money has pretty much dried up," he said.

Schools must present a budget request to county leaders by mid-May.

"I know the state's in a mess, I know the county's in a mess, but we still have children coming to school every day," Croom said.