Schools hesitant to use savings to fill budget gaps
07:12 AM CDT on Monday, May 31, 2010
While area school districts fret about balancing their budgets, trimming here or tweaking there, few are in danger of not having enough money to pay the bills.
Many districts are sitting on healthy savings accounts, several holding more cash than the state recommends. Those that plan to use some of those savings in the 2010-11 school year are not happy about it.
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"When it's spent you are going to have a very, very difficult time recouping it," Garland Superintendent Curtis Culwell said.
The state recommends that districts have 16 to 21 percent of their operating budget in a fund balance, or savings account. The money is used to cover expenses in the first part of the school year before tax dollars and state aid payments roll in. It's also used for emergencies and helps districts get lower interest rates when they sell bonds.
Even in times of increased costs and flat funding, many area districts have the recommended amount or more.
Some of that money is being used to plug budget holes.
Garland, Mesquite, Richardson, Carrollton-Farmers Branch and McKinney, among other districts, believe they will not be able to balance their budgets for the next school year and will have to use money from savings.
Even though they have the money in reserve, the districts still look for cuts.
"Why are we cutting when we have a healthy fund balance? It is a prudent and conservative approach to the potential for hard times in the future," said McKinney district spokesman Cody Cunningham. "Wouldn't it be better to be conservative now and plan for the worst than to be like districts that have to lay off 100 or so teachers?"
Superintendents are afraid to spend the money because when it's gone they are not sure where more will come from, Culwell said.
The Dallas district has a dangerously low fund balance, just 3 percent,