LETTERS: BACKGROUND ON SCHOOL FINANCES

To the editor:

We are writing this letter to the people of Cape Girardeau in an effort to set the record straight and, as a result, shed some light on why the Cape Girardeau School District finds itself in the financial predicament that presently exists.

When Dr. Neyland Clark came to our school district, the Board of Education charged him with three primary tasks: 1. the necessity of building new schools. 2. The revision and compilation of the policy manual. 3. The discontinuance of deficit spending by drawing on existing surplus funds to balance the budget.

Through appreciable focus and concentration, all three priorities were addressed. Unfortunately, we were unable to accomplish the much-needed building projects but did succeed in laying the groundwork for a successful bond issue. With the assistance of the Missouri School Boards Association, a total revision of the policy manual was attained. In addition, we achieved a balanced budget with intact monetary reserves within a period of one year.

The budget was balanced by the administration under the careful eye of the school board's finance committee. In the early 1990s, Jim Hirsch, who served as chairman of the finance committee, predicted that the school district would exhaust its financial reserves by 1997-98. He indicated that if spending continued at the rate that was occurring at that time, the district would be illegally operating in the red.

The school board directed Dr. Clark to propose a list of program cuts in an effort to curtail the spending deficit. A list of $1.2 million of cuts was approved and implemented. The board was praised by the editorial staff of the Southeast Missourian with a recommendation that the federal government should learn a lesson from our actions and follow suit.

Balancing the budget was not easily accomplished and was not a popular move for the board. There were many disgruntled teachers, parents and patrons of the district would were less than satisfied with programs and positions that were cut. While we realized that our actions were very unpopular, we knew we were acting in a fiscally responsible manner.

Conflict of interest was an important issue to the board, as a few of our members had spouses who taught in the district. While one board member was very professional and refrained from all voting and discussion on teacher salaries and negotiations, such was not the case with another board member. He actively lobbied administrators and fellow board members for significantly larger teacher salary increases, which the rest of the board felt were unaffordable. The board limited increases to modest, affordable raises. Due to the nature of this conflict of interest and personal agendas that existed on the board, we anticipated an overwhelming potential for financial problems and improprieties within the district. This potential, coupled with the feeling that our voices would not be considered and the vicious turmoil that we had already experienced, led us to voluntarily leave the board rather than be a part of any financial carelessness.

It has recently been reported that Cape Girardeau School District finances are stressed. Dr. Dan Tallent has indicated that sizable teacher salary increases four years ago have contributed to the current financial situation. However, these increases did not occur at that time.

The district maintained a balanced budget after the cuts until the 1995-96 fiscal year, the year after we left the board. From 1992 until 1995, the cash reserve balances were growing and had reached a balance of $4 million. As a result of Senate Bill 380, enacted in 1993, our state funding had reached a plateau and would not vary significantly year to year. By that time, we were already designated as a hold-harmless school district. This meant that although we would probably receive no additional state money, we would not receive less per student that we had received prior to SB 380. In addition, any increases in local tax money could negatively impact the amount received from the state, creating a static financial situation.

All financial decisions were made responsibly regarding the impact on the future, particularly any recurring expenditures. Staff salary increases were modest, and the district was living within its means. From 1992 to 1995, teacher salary increases ranged from 1.46 percent to 4.16 percent. The 1.46 percent increase in the 1992-93 school year followed the budget reductions.

Under the leadership of veteran board members Bob Fox and Steve Wright, a 5.242-5.755 percent teacher salary increase was approved by the new board for the 1995-96 school year. In addition, the new board intentionally overbudgeted approximately $550,000 and was cautioned by the superintendent and business manager about adopting a budget that would result in deficit spending. Coincidentally,the price tax of that year's teacher salary increase was $481,457.

Dr. Tallent has been quoted as saying the voters "can't see us using money they approved for building projects to correct our financial problems, because that wouldn't be responsible." Indeed, it would not only be irresponsible to siphon building funds to pay operational expenses, it would be illegal.

Several months ago, the Board of Education's finance committee was dissolved. Perhaps it is time to re-establish that committee to keep watch on the district's finances. All school boards have the ultimate responsibility to base all financial decisions, including financial compensation plans, on projected revenue while preserving a balanced budget.

PATRICK RUOPP

KATHRYN J. SWAN

Cape Giardeau

EDITOR'S NOTE: Ruopp and Swan are both former members of the Cape Girardeau Board of Education.