Lincoln Eyes Finances

DISTRICT WORKS TO RESOLVE PROBLEMS

Lincoln School District officials are walking a straight and narrow line to put money in the bank in the next two years.

An austere spending plan is in place after a state review of the district’s finances.

The review was triggered by a declining balance in a single fiscal year and the loss of about 50 students during the past three years, according to the Arkansas Department of Education finance officials.

Superintendent Clay Hendrix said the district needs to have a $2 million balance by the end of this fiscal year, which runs from July 1 to June 30.

“We need to put money in the bank,” Hendrix said, a message he has shared with teachers and staff.

Hazel Burnett, coordinator of fiscal distress services at the state Education Department, said the review indi- cated the district could be moving toward fiscal distress unless corrective actions were taken.

The Legislature three years ago adopted a law creating an early intervention program intended to stave off financial deficiencies that cause fiscal distress. The state maintains a watch list of school districts that need intervention in their fiscal practices to avoid distress.

Hendrix met with Burnett and other financial staff members in October.

The department determined Lincoln won’t be placed on the early intervention watch list, which was good news for Hendrix, he said.

Burnett said the state was particularly concerned Lincoln projected a balance of $1.8 million for fiscal 2011 but ended at nearly $ 1.4 million.

“That’s $400,000 in one year,” Burnett said. “That’s a pretty steep decline.”

The balance at the end of fiscal 2012 was $1.4 million, according to budget summaries on the Lincoln School District website.

The decline influenced the state department’s review of Lincoln’s finances under the early intervention law.

The district has a budget of about $11 million for the current fiscal year, Hendrix said.

The state and Hendrix agreed the financial concerns were because of the declining enrollment and the cost of three construction projects: roofing Lincoln Elementary School, $279,000; a new heating and air conditioning system for the elementary school, $ 1.2 million; and the new high school, $13.17 million. Athletic facilities are expected to cost just more than $1 million.

The projects have increased the district’s debt payments about $300,000 in the past three years, according to budget documents.

The district’s largest cost is personnel, which accounts for about 70 percent of the budget.

Five positions were eliminated through attrition, including the assistant superintendent, a counselor and an assistant principal at the elementary school. The savings was between $350,000 and $400,000.

“We will have to look at that next year, too,” Hendrix said. “The only way to keep expenditures in line is through a reduction in force. It will be through attrition to the degree possible.

“We’re not doing anything to affect instruction,” Hendrix said, noting teachers and staff members are being more conscientious about turning out lights and lowering the thermostat.

“We look at every district every year,” Burnett said. “We do a review to try to catch things before it gets too deep, to catch it before it becomes fiscal distress.”

The early intervention program allows districts to develop their own strategies for cutting expenses, Burnett said.

LYNN KUTTER ENTERPRISE-LEADER Farmington City Hall has a new, four-color electronic board. In addition to messages, the new board will be able to display graphics and photographs. Check out the board for the latest information from the city.