Schools' actual budget becomes clearer

A final accounting shows that cuts made in December were important.

For the past year, the most important question facing the Hernando County school system has been about the health of the district's budget.

It was a year during which the district had three budget directors: one who said the sky was falling, another who said there were no worries and a third who tried to sort out the truth.

It was a year in which then-superintendent John Sanders and the School Board at times didn't know whom to believe or where things stood. Eventually, they sought a middle road, agreeing in December to cut their budget back by $2.4-million.

Now, a final accounting of the books shows that the December cuts were much-needed but that a financial meltdown feared by some never materialized. In short:

The district spent $85.5-million last year on day-to-day expenses, about $100,000 less than the revenue it took in.

Before the cuts, the board was on pace to spend about $2-million more than it took in.

The cuts not only brought the budget in line but also added $143,000 to the district's slim rainy day reserve, which now stands at $1.3-million.

Medical costs in the school district's self-funded health insurance plan outstripped the money put into the plan by $2.9-million, creating an internal debt that must be repaid with cash that could otherwise be spent on the classroom.

The new numbers bring clarity to a budget that was anything but clear in the past year.

The fog developed when budget director Vince Benedict, who resigned last summer for health reasons, and Sara Perez, his successor, came to vastly different conclusions about the district's financial state.

Benedict, a veteran who relied on his experience and his insight as much as raw data, predicted that 2000-2001 would be a tight year. But, with some routine adjustments, he predicted that his final budget would prove accurate.

Perez, who put her faith in hard numbers instead of gut feelings, said Benedict's original budget was on pace to spend $5.9-million above its expected revenues.

Carol MacLeod, a former auditor who took over the budget office in December after Perez resigned for family reasons, was asked to sort out the truth.

By then, the board had cut its budget, enacted a hiring freeze and put strict limits on new spending. The cuts weren't devastating. But they were far more drastic than Benedict's past practice of covering shortfalls in one area of the budget with surpluses from other parts.

Jo Ann Hartge, who was president of the Hernando Classroom Teachers Association last year, said cuts meant the district wouldn't pay for substitute teacher's aides when regulars were out sick, leaving teachers to fly solo in crowded classrooms.

They meant that a handful of teachers working outside the classroom, including two that taught rookie teachers survival skills and helped struggling veterans improve, had to fill teaching vacancies. Their previous jobs were simply eliminated.

For a time, Hartge said, it also meant that supplies ranging from workbook materials to art supplies were hard to get and professional training was reduced. Toward the end of the year, things eased up some. But, Hartge said, "I don't want to repeat that again."

MacLeod has refused to declare a winner in the Perez-Benedict debate. But she has some thoughts on the problems in the budget.

Benedict, who was on chemotherapy for bladder and prostate cancer at the time, didn't leave any clear documentation of what early adjustments Perez needed to make to the budget.

At the same time, MacLeod said people overreacted to Perez's worst-case prediction that the budget was $5.9-million out of line. Even Perez knew that routine retirements and resignations would result in less-than-expected payroll spending, she said.

In the end, MacLeod said the school district was never in a budget "crisis." Budgets are spending plans, she said, and they are not etched in stone. By definition, they require constant tweaking. But she agrees that a $2.4-million cut is nothing to laugh at.

"I would have hoped we would have done our front-end work better so we wouldn't have needed to do that," MacLeod said. "But there is nothing wrong with that."

The school district faces two financial audits in the next few months that are mandated by the state. And MacLeod plans to give a clearer view of where the December cuts were made.

Both should shed further light on the budget.

For now, the district has an $86.8-million budget, slightly larger than last year's. But schools have been ordered to cut back on spending money they have discretion over -- one final safeguard to keep history from repeating itself.

- Times staff writer Robert King covers education in Hernando County and can be reached at 754-6127. Send e-mail to rking@sptimes.com.