By IVY HERRON
Clay Community School Corporation's Business Manager Mike Fowler proved he is a straight shooter when it comes to talking about the budget.
During his first financial presentation to the school board, Fowler went straight to the heart of the budget problems.
"In 2000, the corporation had a year-end cash balance in the General Fund of $4,497,865, which is good. There's money left over to handle rough spots," he said. "But in 2005 the balance was $2,790,080 -- that's not enough."
If the state decides to delay making a payment to the corporation during this year (which has happened in the past), according to Fowler there barely would be enough to make the monthly $2.3 million in payroll and utility expenses the corporation pays each month.
"That's like living paycheck to paycheck," he said.
Another problem is wages and insurance.
"Of the General Fund spending, 93.49 percent is spent on salaries and benefits -- the state average is 82.5 percent." Fowler said.
He told the board that 69.89 percent of that amount was for salaries -- 51.8 percent for teachers and 4.99 percent for administration -- with the remaining 9.7 percent spent on ever increasing health and life insurance premiums.
"From 2002 through 2007 all increases in state revenues have gone to pay for insurance," he said. "We've got to get a handle on this."
An unexpected budget problem occurred when the corporation discovered student enrollment was down.
The ADM -- the average daily number of students enrolled at the nine schools in the corporation -- has decreased by more than 70 students since last year. The state uses that ADM to determine the level of funding for each corporation throughout the state.
There have also been decreases in the vocational counts, special education estimates and the number of students participating in the Academic Honors programs; all of these programs supply funding to the corporation based upon student participation.
"The loss of those students cost the corporation the projected $267,990 for the 2006-07 budget,"
Fowler said. "What we will get will be in the neighborhood of around $89,975."
Another area of concern for Fowler are the programs in the corporation funded through grant money that is slowly dwindling away.
"In the next 12-18 months we're going to have to think about how do we continue to maintain programs, like the LEAAP Center, that have been supported by these grants when the money is gone," he said.
The problems of the past have created an unsustainable model for the corporation, according to Fowler.
"There is no extra money. No one has received a raise in salary for several years, and you can flat line a budget doing that. There has been money saved through attrition, but you're going to inevitably run out of people," he said. "All the easy solutions have been achieved, they're gone."
With the harsh reality of the budget out of the way, Fowler said there was good news.
"We have recognized there is a problem, that is the first step to correcting it," he said. "We also have a little time to work on a solution to the problems. There is no magic bullet, one simple answer, that will fix this. Multiple solutions, tough solutions are required and can be developed to fix this."