School system hit with 11% cut in funding; proration in effect

By By Clif Knight, Hartselle Enquirer
A worst-case scenario in state funding for school systems in 2008-09 was reached on Monday when Governor Bob Riley declared proration in the amount of 12.5 percent. At the same time, he approved a $218 million withdrawal from the state’s Rainy Day education fund, lowering the proration rate to about 9 percent.
The move resulted from a slowdown in the state’s economy and has been anticipated since the start of the current school term.
“Our school system will actually lose 11 percent instead of 9 percent if the current proration rate is in effect for the entire 10-month school year,” Superintendent Dr. Mike Reed said. “If the governor opts to withdraw all of the $437 million in the Rainy Day fund, the loss would be reduced to about 5.5 percent. As things now stand, we’ll be getting $156,729 per month less from the state than what we have budgeted, or a total of about $1.8 million.”
Proration occurs when anticipated tax revenues fall below the level needed to meet budgeted expenditures. State law prohibits deficit spending.
Reed said a conservative budget, with a built-in contingency of 5 percent, will soften the blow and a reserve fund of between $2.5 and $3 million will be used, when necessary, to offset the deficit.
He said all unnecessary travel will be eliminated; all hiring curtailed; substitutes for non-instructional personnel (except bus drivers) eliminated; and all purchases looked at individually.