Cuts worry APS official

$12.5 million cut may impact credit rating, reimbursements

Chief finance officer warns the board that a $12.5 million reduction in cash reserves will weaken district

Albuquerque Public Schools’ chief finance officer warned the board that a $12.5 million reduction in cash reserves approved by Gov. Susana Martinez may force the district to “pick and choose what checks we send out the door.”

On Wednesday, CFO Tami Coleman stressed that the cash reserves are not “free money” — APS uses the fund, which currently stands at $53 million, for a variety of critical areas, including summer payroll.

The balance also helps APS maintain a strong credit rating and covers state and federal programs until government reimbursements come through.

Coleman noted that those reimbursements add up to tens of millions of dollars.

“On June 30th of 2016, we were due reimbursements of $38 million,” Coleman told the APS board Wednesday evening. “If our cash balance drops below that $38 million and we are owed that again, we are going to have to pick and choose what checks we send out the door.”

APS will have about $40.5 million left in cash balances after the $12.5 million cut, which is outlined in a package of legislative solvency bills the governor approved Tuesday.

Under the plan, school districts across the state will lose money, adding up to $46 million — substantially less than the $120 million Martinez had hoped to pull from reserves.

Coleman said, while it may sound like APS will still have a substantial balance, it takes $51 million just to cover one month’s expenditures. APS, the 34th largest district in the nation, has a $1.3 billion budget, which includes $687.6 million in operating funds.

APS lost $12.5 million during a special legislative session held in October to address a massive budget deficit — $9.5 million from the district operational budget and $3 million from the “categorical” budget, which includes transportation and instructional materials.

More money woes are on the horizon. New Mexico could face a $300 million to $500 million

budget shortfall in the coming fiscal year, largely due to declining oil and gas revenues.

Last month, Coleman told a board committee that district administrators are considering every option to cover the reductions, including layoffs and district-wide furloughs.

On Tuesday, Superintendent Raquel Reedy said “no decisions have been made” on the budget, but she is working to reduce the impact on schools and staff.

In an email to all district employees, Reedy said “it pains me to have to ask more of you, yet that’s what I’m doing.”

“Despite the state’s — the district’s — budgetary woes, we still need to stay focused,” she said. “We’ll work to minimize the impact on your workplace as well as your pocketbook. Thank you more than ever for all you do.”