Cutbacks leave Wake schools with money in bank
Posted December 5, 2012
Cary, N.C. — Cost-cutting by the Wake County Board of Education and school district administrators has left the district with a $32 million balance that some say should be refunded to the county.
An independent firm recently completed its audit of the district's finances and determined that the school system is fiscally responsible across the board.
"As a collective, one area we've done really well is managing the finances," school board member John Tedesco said Wednesday.
Case in point, the deep cuts the district made last spring before adopting a $1.25 billion budget for 2012-13 left a $32 million balance for emergency expenses through next June.
School board policy states that the balance should no more than 6 percent of the amount the Wake County Board of Commissioners gives the district, and the current balance is over that amount by about $12 million.
"What offends me was, you don't go crying poor mouth to the commissioners, saying you need another $8 million more, which we did in the spring, when you're sitting on $32 million," Tedesco said.
School administrators asked the Board of Commissioners for an extra $8.8 million in funding to balance the annual budget, but the commissioners provided only $3.9 million.
School board policy calls for excess money above the 6 percent balance to be returned to the county, but new board Chairman Keith Sutton said the district continues to face tight financial times.
About $28 million in federal funding will disappear in 2013-14, so the district might need to tap into reserves to make up for that, Sutton said. Also, the district could put money back into building maintenance and pay for teaching assistants and bus drivers after recent cuts, he said.
"Just to sit on it because we want it to be bigger and bigger doesn't seem to be appropriate with public dollars," Tedesco said, adding that a $20 million balance provides enough of a financial cushion.
Joe Bryan, the new chairman of the Board of Commissioners, praised the school board for building a healthy reserve but said commissioners would have to consider the hefty balance when deciding on future funding requests.
"It certainly hurts their credibility of asking for more and more money," Bryan said. "The commissioners think it's reasonable to have this conversation about how much is that fund balance (and) should we have some say in it."
Sutton said he looks forward to having those budget discussions.