The Morgan County Board of Education adopted a $74.1 million operating budget for fiscal 2013-2014 at a regular meeting Thursday night.

Of the total, $37.8 million is coming from the state, $22 million from local sources and $6.1 million from the federal government.

A surplus of $12.2 million is anticipated as of Sept. 30, 2014.

State-funded teacher units total 493, or two fewer than what the school system had in the prior fiscal year. Local funds account for 43 teacher units.

Revenue from the state is down $830,000 while local funds are up 3.5 percent or approximately $300,000. Federal Title I and Title II funds dropped $51,000.

The budget includes a two percent salary increase for teachers and support personnel, $130,000 for technology upgrades, and $300 per teacher for classroom supplies.

Chief School Finance Officer John Godwin said the new budget calls for expenditures that are $1.8 million more than what they were in the prior year. He said the additional costs stem from higher debt service, salaries for school resource officers, reading coaches, instructional teachers and a PACT contract.

“Things are looking better financially,” Godwin said. “but we still need to be mindful of our limited resources and prudent in the way we use our funds in 2013-2014.”