BROOKSVILLE — Amid recent reports of a grim financial outlook, the Hernando County School Board on Tuesday will hold the first of two public hearings on the district's 2014-15 budget.
The Hernando County School District is projecting that it will end the year with about $6.8 million in unassigned reserves, representing 4.39 percent of estimated revenues. Although that is short of the district's policy of maintaining a 5 percent unassigned fund balance, it would be considerably better than what was forecast last month.
During a workshop in June, the district estimated it would end the 2014-15 year with about $3.5 million in unassigned reserves, equating to about 2.28 percent of estimated revenues.
CFO George Gall said the reason for the brighter picture is that estimates for both revenues and expenditures have improved.
The district is expected to take in $154 million in revenues, including $105 million from the state and $48.6 million from local sources. At this time last year, the district's total revenues from the state and local sources fell just below $151 million.
The district is also expecting to roll over $17.2 million from the previous year, a figure that is also higher than reported last month.
While the district has had some increases in revenues, including new funds allocated because of its relatively small size, it has not been enough to offset some other losses and new expenditures, Gall said.
The district will receive an additional $256 per student from the state this year, equating to about $5.5 million and nearly $2 million in sparsity funding.
The district is expecting to lose about 350 students for the 2014-15 year, bringing enrollment down to about 21,613. The projected loss in revenue is about $2.4 million. The district is also looking at other losses tied to implementation of the Affordable Care Act, an increase in enrollment at charter schools and higher costs for school resource officers.
A detailed comparison of all new expenditures and revenues was not available.
At Tuesday's hearing, the public will also get a look at the proposed property tax rate of 7.167 mills, which includes 4.919 mills for the required local effort, 0.748 mills for discretionary operating and 1.5 mills for capital outlay.
One mill is equivalent to $1 of tax for every $1,000 of assessed, nonexempt real property. That means someone with a home assessed at $125,000 and a $25,000 homestead exemption would pay about $717 in school tax, or about $11 less than last year, assuming that the value of the property remains the same. Last year's millage rate was 7.28 mills.
The budget hearing comes after the board was given a rather grim financial picture last month.
Over the past four years, the district's general fund spending has outpaced revenue by about $25 million. The trend is forecast to continue for the 2014-15 year.
It means the district must transfer money into the general fund to make up the difference, in turn making less money for capital projects.
The district has more than $200 million in capital projects, technology requirements and debt service to cover over the next four years, with only nominal dollars available, said Gall, the district's chief financial officer.
"The negative financial spiral will get worse if we do nothing," he wrote in a presentation to the board.
Before the district's budget discussion Tuesday, School Board members are expected to discuss possible solutions during a workshop.
The district has not yet made those options public. The agenda says the board will "review various options that may be taken to reduce core general fund expenditures."
Contact Danny Valentine at [email protected] or (352) 848-1432. Follow @HernandoTimes.