No opt-out will force school staff, program cuts should tax opt-out fail

No opt-out will force school staff, program cuts should tax opt-out fail By David Lias A significant cut in the Vermillion School District's general fund � to the tune of over $350,000 � will be necessary in the 2005-06 school year if voters decide not to support an opt-out of the state's property tax freeze in March.

The Vermillion School Board revealed during its Monday meeting what programs and staff members would tentatively need to be trimmed because of a revenue shortfall should the opt-out fail.

A wide swath

The school board proposes to take a wide swath through the many line items in the general fund. Two teachers would be eliminated from elementary instruction to save $75,000; cuts will be made in personnel, textbooks and supplies at the middle school to the tune of $48,000. Personnel and supplies will be trimmed at the high school to save just over $78,000.

A guidance counselor, a librarian, and two clerical staff will be eliminated from support services, and the school nurse will be reduced to a half-time position to reduce expenditures in operations and support services by over $125,000.

A wide range of co-curricular activities will be eliminated, from cheerleading and class advisors, to quiz bowl and the art club, to save nearly $13,000. Physical education and music instruction also will be cut for an additional $11,300 trimming of the general fund.

An audience of approximately 100 people, made up of school staff, students and concerned citizens, packed the meeting room of the Al Neuharth Media Center to hear the board's recommendations.

Decisions aren't final

"This is not a motion, this is just for information," School Board President Tom Craig, president of the school board, said before announcing the cuts. "No final decisions will be made until we know the results of the opt-out."

Individuals who would be affected by the proposed cuts had been notified before Monday's announcement.

"This is information for the public; last time the information that we provided was more of a general nature," he said, referring to the school district's previous attempt to opt-out of the tax freeze, which failed. "I think when we finally did make some cuts, it surprised some people. This time we're attempting to do it differently, so the community knows, you people know, specifically the areas that are going to be affected if the opt-out does not pass."

The proposed cuts come after several weeks of work by several committees made up of citizens, educators, school administrators and board members.

The opt-out

The committee structure was implemented by the board several months ago when it became obvious that the school district's general fund, at its current levels, is inadequate to meet next year's revenue needs.

Board members unanimously agreed last month to opt-out of the state property tax freeze by $800,000 annually for five years.

This action was spurred by the Vermillion PTA, which had gathered approximately 1,000 pledges from district patrons who support the opt-out.

Residents of the school district will have the final say. Rather than letting citizens circulate petitions to refer the opt-out decision, board members voted to put the issue to a public vote March 15.

If approved, the opt-out would begin with 2005 taxes payable in 2006. It would conclude with 2010 taxes payable in 2011.

Future revenue needs

The board is also working to identify an additional $100,000 in general fund budget cuts that will be implemented regardless of the result of the opt-out election.

Craig described the rationale used by the board to decide the district's future revenue needs.

"When we were putting together our opt-out proposal and we came up with the $800,000 figure for five years, we made three assumptions: one was that we would get 2 percent per year from the state in increased funding, one was that our expenditures would increase at the rate of 3 percent per year, and the other was that we would lose an average of five students per year," he said.

The school board may soon be in an unexpected financial struggle if the state Legislature is unable to amend Gov. Mike Rounds' budget proposals for public education.

In his budget address in

January, the governor said state aid funding to education would total $412,000 of new money for K-12 education. Per student funding would increase from $4,160.31 to $4,205.26. The $44.95 in additional funds per student is an increase of barely more than 1 percent. "Obviously, when you are talking about 1 percent, that puts us in more of a bind than we were anticipating, because we aren't getting the money at a 2 percent rate which we thought was fairly conservative," Craig said.

Financial impact

Loss of students has also had a major financial impact on the Vermillion School District. Over the last five years, the district enrollment has declined, on average, by about 20 students annually.

"At $4,000 per student, it adds up quickly. The reduction in our enrollment is starting to level off; that's why we projected five per year," Craig said, "but if the decline is more than what we projected, the financial problems that we have right now are just going to be compounded."

According to Superintendent Mark Froke, an opt-out of the tax freeze would increase the school district's levy on ag real estate to $10.12 per $1,000 in valuation. That's an increase of $1.20 per $1,000.

The school's share of taxes on non-ag property would total $11.48 per $1,000, an increase of $1.56. The estimated school levy on owner-occupied real estate following a successful opt-out would total $12.89 per $1,000, an increase of $1.93.

Commercial property taxes would increase to $21.26 per $1,000, an increase of $4.14.

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