The three budgets were introduced as three separate items on the agenda. Board members voted 4-3 Monday to reject the passage of the cafeteria fund, the general purpose school fund and capital outlay budgets.
Without any fanfare, the cafeteria fund budget passed Wednesday by unanimous vote.
The two other budgets were the main focus of board members and many of the meeting’s attendees, several of whom ended up standing along the sides of the room and in the room’s main doorway because so many had shown up to hear the budgeting process.
Introducing the general purpose budget, Director of Schools Johnny McDaniel stressed that, while it had been the subject of scrutiny at the previous meeting, the budget looked the same as it did when it was first presented to the school board in late April.
“It’s the same budget,” McDaniel said. “It hasn’t been changed.”
After a motion and a second to pass the general purpose budget as it was had been made, board member Chris Turner said he wanted to know why the portion of the budget that concerned projected equities had not been assigned to specific budget line items.
Business office manager Rick Smith said it had to do with county debt reserve policies. The local school system is required to maintain a reserve fund with at least 5 percent of the school system’s expenditures.
Smith explained estimated total expenditures of $69,910,500 for the upcoming year and estimated revenues and other sources totaling $67,910,500 left projected equities of $3,775,261.
However, the 5 percent in equities the school system is required to keep is only $3,465,525, based on the estimated expenditure amount.
With the revenues expected to be more than the expenditures, Smith said $309,736 was the “maximum amount” available to set aside to use for other purposes.
Turner said McDaniel had introduced the budget as being “balanced,” but he wondered why there was such a big difference between the revenue and expenditure amounts.
“Are we spending … more than we take in?” Turner asked.
Smith said the equities would allow the system to use money beyond the required 5 percent of equities to cover expenses.
Board member Nicholas Lillios asked if that meant the money in the school system’s savings was being treated like income.
Smith said no, reiterating the budget was expected to end up being balanced.
“We’ve never run a deficit,” Smith said. “This is the way I’ve budgeted my entire career.”
Turner questioned the necessity of budget line items like the inclusion of $2,000 for a retirement plan for board members that all were not eligible to use yet, as well as why $2,000 is budgeted for board member travel expenses in two different funds.
He suggested completely doing away with the retirement line item and cutting the amount allotted for out-of-town travel expenses by $1,000.
Board member Christy Critchfield interrupted to ask about another expense budgeted for school board members.
“Is the salary optional?” she asked.
Smith said he would have to look into it, but he believed board members could choose to either donate their $24,000 in total annual salaries to the school system or simply refuse the pay.
Returning to the matter of the equity percentage required by the budget, Smith said his goal was to have a reserve of between 5 and 8 percent for the sake of “flexibility” in the event new expenditures are needed.
Turner then introduced a substitute motion to pass the general budget with several changes. He proposed decreasing the line item for teacher salaries from $26,965,000 to $26,715,000, a difference of $250,000. That $250,000 would then go into a new account for long-term capital projects that would include that $250,000 and the $309,736 from unassigned equities.
Other changes included requiring a fiscal report to be compiled at the end of the fiscal year and for any nonsalary items above $1,000 to have fiscal notes explaining where the money went and why.
Another modification amounted to a change in board budget policy for the 2015-16 fiscal year.
Turner proposed having board members submit budget requests this October to be considered for the fiscal year that would begin in the following summer.
The director would then compile a “mock-up” of the budget to be presented to the board in November.
Also included in his substitute motion were his suggestions to do away with the retirement fund and reduce travel expenses.
Lillios seconded that motion.
However, board member Troy Weathers took issue with the motion, pointing out that cutting $250,000 from the teachers fund amounted to cutting five teaching jobs.
“To say that we are eliminating teaching positions is actually not true,” board chair Vicki Beaty said, pointing out teachers leave schools each year because of retirements and resignations. “We can do that, and no one can lose their jobs.”
Weathers countered the vote would still mean there would be five fewer teachers in the school system.
After a recess to consult with a lawyer to see if the retirement portion could be removed, McDaniel said the school system’s legal counsel said it could not.
Turner’s substitute motion passed with Turner, Lillios, Beaty, Charlie Rose and Rodney Dillard voting in favor. Weathers and Critchfield voted no.
After the vote, Dillard stressed he was voting in favor of the budget. but he was not making an effort to eliminate teaching jobs.
“I didn’t just vote to eliminate five teachers,” Dillard said. “I voted for us to move on.”
Beaty echoed Dillard’s sentiment that it was time to move on to matters other than the budget.
However, she also said there had been some confusion over what the board had actually been planning to do in terms of lessening the number of teachers.
Beaty said the board’s majority voted the way it did to ensure the success of the school system as a whole and “save” future teaching jobs from being cut due to unexpected expenses like capital projects.
“There has been a lot of misunderstanding,” Beaty said. “This board is attempting to find a longterm solution … But I understand that it could be very concerning for teachers.”
The board chair said the county school board will in the future begin working on the budget much earlier in the year, which should eliminate some of the problems this budget season has seen.
Weathers said he believed more jobs would be cut to fund things like capital projects in the future. He said he would still have that belief whether or not he serves on the board next year.
“That’s what will take place. … It’s coming,” Weathers said.
Beaty agreed that would be a possibility if retaining teaching positions is not made more of a priority in the future, but she stressed the five teaching positions eliminated by the passage of the budget had been left vacant by teachers who either retired or quit — not those who had been the subject of a layoff.
“If we do not do something, that could happen,” Beaty said. “[This year] no one is going to lose their job.”
The board then turned its attention to the capital outlay budget.
McDaniel said the capital outlay items included in the proposed budget were the result of recommendations from the board’s capital outlay subcommittee.
After first and second motions were made to pass the budget, Turner criticized how he had not been “invited” to the meeting where all the schools’ needs were discussed so he could give his input on the process.
McDaniel responded by pointing out that it was a public meeting, and members of the media were able to attend.
There had been some “dirty rumors” floating around about the possibility of the school system cutting funding for the arts, Turner said.
In what he described as an effort to put such rumors to rest, he proposed an amendment to the capital outlay budget to approve a request that had not been met. Turner said he wanted to add $3,000 to purchase a concert tuba for Walker Valley High School.
The amendment passed with four votes by Turner, Rose, Lillios and Dillard.
With little discussion following that, the board voted to approve the amended capital outlay budget 6-1. Christy Critchfield provided the lone dissenting vote.
The school system’s budget requests will soon be sent to the Bradley County Commission for its review.
Beaty reminded board members that today is the deadline to turn in anonymous surveys they had been given as part of the school system director’s evaluation process.
Weathers asked why the evaluation forms had to be anonymous. He was willing to sign his name on his.
Beaty said anyone who wanted to write their name on their director evaluation form was welcome to do so.
The evaluation process became a point of discussion during the board’s regularly scheduled meeting in May, and its members voted to evaluate McDaniel this year using an assessment put out by the Tennessee School Boards Association.
The evaluation was set to take place during the next regulary scheduled meeting, which is Thursday, June 12, at 5:30 p.m. in the board room of the Bradley County school system’s central office.