Birmingham School Board Passes 2012-13 Budget With $2.3 Million Deficit
The school district has been able to live within its means for two years now, schools official says.
The Birmingham Board of Education approved a budget for the 2012-13 school year Tuesday night, featuring a lower-than-expected projected deficit for the coming year.
According to a presentation from Assistant Superintendent for Business Services Debbie Piesz, the district is projecting a $2.3 million deficit for the 2012-13 school year, down from the initial $5.9 million deficit Piesz presented to the school board at a meeting earlier this spring.
In 2012-13, Birmingham Public Schools is expected to spend $104.8 million while bringing in $102.5 million in revenue.
To make up for the deficit, Piesz said the district has more than enough cash in the district's fund equity account — funds kept in reserve and only spent on certain projects. According to School Board Policy 6215, only a certain percentage of fund equity may be transferred to the general fund per year.
The school district is required to pass its annual budget by June 30, the end of its fiscal year.
Piesz said Birmingham is positioned well going into the upcoming year, with local taxable values increasing by 1 percent since 2011-12.
"We haven't had a positive increase of this magnitude since June 30, 2008," Piesz said. "We have definitely turned the corner and we are kind of leading the charge in Oakland County as a whole."
Piesz said the district was able to reduce expenditures by cutting employee health and retirement costs, and contracting out many services such as custodians and bus drivers. Meanwhile, Piesz said the district received an additional $1 million in revenues from local and federal sources.
"This makes two school years in a row that we've been able to coast, or live within our means," Piesz said.
Coming up, Piesz said the school board will need to address a continual drawing down of cash in the capital projects and building and site funds.
"We'll have to revisit this process in August or September (to address this issue)," Piesz said, adding that union contracts will also be up for renewal in 2013.
Also at the Tuesday night meeting, school board members approved a 4 percent increase in the annual millage rate. Community members will pay 15.05503 mills in 2012-13, up from 15.0240.
Still, Piesz said the state's contribution to the district's budget is up in the air, as the state Legislature continues to work to finalize its budget for 2012-13.
"To the extent that we continue to market the school district (and) have great teachers, that's going to be our keys to our success," Piesz said.