Shortly after Rachel Olson and Shane Nordyke were sworn in to begin new terms on the 2021-22 Vermillion School Board, the body completed one of its most important actions of this year – it approved a resolution to adopt the school district’s annual budget for the next fiscal year that runs from July 1, 2021 through June 30, 2022.
“Probably one of the most important functions of the school board, besides policy creation, is the creation of a budget for the school district,” Superintendent Damon Alvey shortly after the “new” 2021-22 school board convened Monday night.
He noted that board member Carol Voss-Ward and outgoing member Tim Schwasinger served on the district’s Finance Committee and carried out a great deal of responsibility in crafting the new budget.
Alvey added that all of the board’s committees have an effect on the budget’s creation.
“Every committee … also touches that. The Building Committee has a large commitment of the facilities side of the budget. Of course, the negotiations and personnel committees have a large responsibility to our patrons by providing wages and increases to our staff and that directly impacts our budget,” he said.
The total proposed fiscal year budget, after adding the totals of the various funds used to finance the operation of the school district, totals slightly less than $14,496,000.
This budget has a general fund total of $9,307,917, a capital outlay budget fund of $2,307,500 and a special education fund of $2,004,935.
The budget’s food service program fund is $625,000 and its enterprise fund is $250,585.
“I served on the Finance Committee along with Tim and Mr. Alvey and Sheila (Beermann, former business manager) and we met many times,” Voss-Ward said. “We met a couple times in the fall and at least six times this spring as we generated this budget.
“It’s just under $14.5 million to serve our district,” she said, sharing some of the information compiled in a memo from Beermann that points out assumptions that were used. That memo states:
1. Opt Out amount remains at $880,000 and is effective until 12-31-25.
a. All returning teachers are currently budgeted at a 2.4% increase ($1,125), increase in masters plus any credit/degree changes as applicable. Total increase was 2.8% for certified staff. The hiring schedule base for FY22 will be $41,400.
Administrators are budgeted for a flat increase commensurate to the amount given to certified staff adjusted for difference in contract days. Classified staff are budgeted for a 2.8% increase with market value increases where needed. Speech and nursing areas were adjusted for market value. A 2.4% increase in the state aid formula has been approved.
b. Extra Duty pay is budgeted with increase as the current schedule indicates.
3. Insurance: The employee will pay $19.25 towards the $2,000 and the school board will contribute $1,000 each year towards the $4,000 high deductible HSA plan. The district will pay the entire cost of $38.52 towards a basic dental insurance plan.
4. State aid based on enrollment level of 1230 students.
5. The General Fund Balance is capped at 25% (This has been waived for FY21 and FY22).
6. Workers Compensation expense was decreased as MOD went from 2.08 to 1.51 preliminarily.
7. The transportation is budgeted in both General Fund and Capital Outlay Fund. Special Education Fund budget includes the applicable amount of transportation for that fund.
8. Grant Dollars have been removed until approval of grants in the fall.
1. Budget developed by Superintendent and Finance Committee Board Members.
2. As of Jan. 1, 2017 all requests to the county auditor must be made in dollars versus levy. My request is very high as not to lose any possible dollars.
3. Current taxes based on spreadsheet from Pierre.
1. Maximum levy went from 1.684 in 2021 to 1.67 in 2022. We reduced the levy by .20 to 1.484 for calendar year 2021. We took the risk and lowered the levy for 2021. With the potential for some substantial SPED out of district costs looming, we will adjust the levy back up to the maximum of 1.670 in calendar year 2022.
1. Pension fund was phased out and the dollars moved to General Fund prior to June 30, 2020.
“Sometimes folk wonder what’s the difference between some of the funding sources,” Alvey said. “For example, they will hear us talk about general fund. The general fund expenditures … are the bulk of our salaries, it pays the day-to-day bills of our district and it really keeps the district in its business position.
“When you hear us talk about general fund, the largest portion of our budget is in general fund expenditures,” the superintendent said. “The parts that you may hear us talk more about when we’re talking about facilities’ reviews or if we’re talking about a new elementary at the fall bond election – the elementary would be funded with a special bond voted on by the public, but most of our facilities’ upgrades, some our technology upgrades and even some of our transportation needs are acquired from the capital outlay fund and that’s another levy that we generate here in the district where we can create dollars for specific usages.”
Capital outlay funds which are intended for improving facilities, he noted, can’t be used, for example, to increase teacher or administrator salaries.
The district also has a special education fund which finances much of the special ed services for students who need them.
“That is an extremely healthy situation where those dollars continue to be used for the benefit of students who might need extra services, therapies, special education classrooms, things like that,” Alvey said.
The board’s finalizing and ratifying of the school budget in a motion Monday night allows the school district to move forward and county auditors will be able to levy appropriate taxation for all citizens in the school district. Most of the Vermillion School District is in Clay County, with a portion of it in Union County.
Business Manager Kevin Kocer read aloud a resolution for the budget for fiscal year 2021-22 that included not only the totals of each fund, but also the tax levies for those funds that will be certified to the county auditor.
Those levies are:
For general fund: agricultural property -- $1.409 levy; owner-occupied property -- $3.153 levy; non-agricultural -- $6.525 levy.
For the capital outlay fund -- $2,550,000.
For the special education fund -- $1.67 levy.
For the bond redemption fund -- $1.3 million.
For the opt out levy -- $880,000.
Kocer noted that the $1.3 million bond redemption fund is contingent on the school bond election that has been set for Oct. 5 to fund the construction a new elementary school in Vermillion.
“If that goes into place on that date, that levy would go into effect for the next year based on this resolution,” he said. “What would happen at that point is that we would have a supplement to our budget in that we would create to separate funds. One would be a debt service fund that any of those tax dollars from that levy would go into and then that would satisfy debt obligations.
“The other fund would be the capital projects fund and that is where the debt proceeds would go into,” Kocer said, “and that would be spent down as the project goes on. Those would be changes that take effect dependent on that Oct. 5 (election) result.”
The resolution received unanimous approval from board members.