Schools told to return money

State plans for budget shortfall

By: By James Romoser and Lisa Boone-Wood | JOURNAL REPORTERS
Published: November 19, 2008

The state is ordering school districts throughout North Carolina to return a total of $58 million to help cover a projected budget shortfall.

The Winston-Salem/Forsyth County school system is required to return $2.03 million -- or about three-fourths of 1 percent of the total amount of state money it received this year.

The education cuts are part of a series of across-the-board cuts ordered by outgoing Gov. Mike Easley. Easley told all state agencies to trim their budgets in light of projections of a state budget shortfall that some state legislators believe could be as much as $2 billion.

The state is facing a shortfall because, in the bad economy, it is not collecting as much tax revenue as it expected. That means that, without budget cuts, the state would not have enough money to pay its bills by time the fiscal year ends next June.

As a result of Easley's order, the N.C. Department of Public Instruction was told to find $119 million worth of cuts. State officials found about half of that amount at the state level. The rest will have to come from local districts and charter schools.

The state is letting local school superintendents decide how to find the money, said Vanessa Jeter, a spokeswoman for the public-instruction department.

"The goal is always to minimize the impact at the student and teacher level," Jeter said.

Local superintendents learned of the cuts Monday in an e-mail from a state education official.

Forsyth County's superintendent, Don Martin, said today that the school system is compiling a list of items that can be cut to give its share to the state.

"It's going to have to be done," Martin said. "We've got sort of a laundry list of things that we can look at. We'll try to come up with probably several ways that we can get to this and each will have their pains associated with it.

"We don't have a fund balance," he said. "Some school districts will be able to go to their reserve -- their fund balance -- and absorb it. For us, we'll have to account for it.

"We're still going to have the basic supplies for students this year," he said. "It's not like it's the end of the world; it's just going to require some sacrifice to do it."

The system has about $200,000 set aside to replace some desktop computers that will likely be turned back over to the state, Martin said, along with salaries for some positions in the central offices and money saved if school officials decide on a moratorium on out-of state travel for school officials.

The school system's finance committee will meet Tuesday to discuss the issue, Martin said.

Each district's amount of repayment to the state was calculated based on its average enrollments. The repayments, known as "reversions," are highest in Wake County, which is required to pay back more than $5.4 million.

Fred Mock, the superintendent of Davidson County Schools, said he isn't worried much about the cuts that will have to be made now. He is more concerned about what happens in the 2009-10 school year, when the state's budget woes are expected to continue.

"People who have a job now won't have a job next year if they look at cuts that deep," he said.

Robert Landry, the superintendent of Davie County Schools, said he and other officials had anticipated that the state was going to require some cuts because of the economy. He met earlier this week with all school administrators about possible places to look for reductions before news of the reversion came down.

"They need to look at their travel," Landry said. "Anything they don't really value, we don't need to be doing."

In Wilkes County, the school system has been saving money on energy by lowering thermostats two degrees and making sure the system's 4,500 computers are turned off at the end of the day, Superintendent Steve Laws said.

It also tried to save on supplies, and expects that the year will follow the typical pattern where two or three positions become vacant at the holidays as people choose that time to move.

Laws will meet with principals soon to go through the budgets line by line to see exactly where to get the money.

He said that it could have been worse.

"If that's where it ends up this year, while it's painful, we can still be thankful… We feel very comfortable at this round nobody is going to lose a job."

Ashe County Schools stopped out-of-state travel in anticipation of the reversion, Superintendent Donnie Johnson said. He said that the system will probably delay ordering new math books for certain grades, something a lot of other systems will likely do.

■ James Romoser can be reached at 919-210-6794 or at jromoser@wsjournal.com.

■ Lisa Boone-Wood can be reached at 727-7232 or at lboone-wood@wsjournal.com.

Journal reporters Michael Hewlett and Monte Mitchell contributed to this article.

Sending money back

The N.C. Department of Public Instruction is ordering school systems across the state to return 0.75 percent of state allocations because of the economic downturn.