DISTRICT NO LONGER 'FINANCIALLY STRESSED'

Cape Girardeau schools were teetering on the brink of a state takeover due to overspending in years past, but officials believe last-minute cost-cutting will stave it off.

Still, items omitted this year can't be put off forever, leaving them to comb through the budget for possible savings in the coming year.

District business manager Rob Huff said faculty, staff and administrators cut more than $1.1 million out of the district's budget for 2000-2001. It appeared the district ended its fiscal year Saturday with balances that were at least 3.3 percent of the annual budget, but an August audit will determine the exact number.

The cutoff is 3 percent.

"We're closer than I feel comfortable with," Huff said. "Some of those things we cut you can't do every year without starting to impact learning."

Huff said district expenses came in under budget and were less than last year, a seemingly impossible feat considering increases in fuel costs, utilities and a 20 percent increase to medical insurance payments.

"It was a pretty big reduction in operating funds. I don't know how anybody can look at that and say we're not cutting back," Huff said.

School committees and department staff members implemented cost-saving measures -- everything from turning off lights in unused rooms to delaying new textbook purchases -- last fall to help the district avoid a "financially stressed" designation from the state.

The designation would have been followed by state-mandated frozen salaries and budget cuts to get reserve balances back to acceptable levels. The state recommends that school districts maintain reserve balances equal to at least 10 percent of what it spent during a fiscal year. Cape Girardeau's balances haven't met that mark in at least seven years.

"We managed to meet the challenge, but the down side is we're starting the year with very little capital," Huff said.

Construction costs

Although proud of the district's cost-cutting measures this year, Huff said more than $4.3 million in reserve funding was paid out of the capital projects budget. The fund is not one that is monitored for deficit spending by the state.

Huff, in his first year as district business manager, said about $2.5 million of the spenddown of balances in that fund was planned prior to his arrival to cover cost overruns on several building renovation projects the district has completed in the past year.

Another $1.8 million was paid out after the state withheld an appropriation to help cover costs for construction of the district's new Career and Technology Center, which will open in August.

Huff said the massive deficit spending to cover construction costs meant the district had to forego some normal maintenance and repairs.

"We have a maintenance van that's almost duct-taped together now," he said. "We're not going to go into the red and we're going to pay our bills, but there are some things that need to be done that we didn't do, that we can't do."

For example, Huff said, major roof repairs are needed at Clippard Elementary School, and a new heating system is needed at Central High School.

Tax increase proposed

Voters will consider a 58-cent operating levy increase Aug. 7 that would provide an estimated $19 million over the next five years to cover increased operating costs, including regular repairs and maintenance and salary increases to compete with other schools in the region. A portion of the money also would be used to install an air-conditioning system at the high school.

A simple majority is needed for passage of the measure.

Schools superintendent Dan Steska said a low-key campaign has gained more than 2,500 pledges of support for the measure.

He anticipates about 3,700 voters will participate in the election, based on previous voter-turnout figures.

Huff said passage of the levy is essential to maintaining instruction and a balanced budget in the future.

"Without that levy it's going to be hard," he said. "Salaries will be impossible, and air-conditioning would be difficult. We'd have to do what we could."

SCHOOL BUDGET

Budget-cutting measures enabled the Cape Girardeau School District to end the fiscal year with balances at 3.3 percent of the annual budget.* The state may designate a school district financially stressed if ending balances fall below 3 percent of annual budget.

Following are the district's Fiscal Year 2001 results, as reported by business manager Rob Huff on Friday. The fiscal year for Cape Girardeau School District runs from July 1-June 30 each year.

FY 2001 results for combined general fund, including capital projects

Starting balances $ 1,836,581

Projected revenue $28,431,439

Actual revenue $28,375,356

Projected expenditures $28,510,801

Actual expenditures $27,320,943

Ending balances $ 909,897

Expenditure comparison

The district spent 2.25 percent less in FY 2001 on daily operating expenses, including staff salaries and normal maintenance and repairs, than was spent in the preceding year.

FY 2001 total expenses $27,320,943

FY 2000 total expenses $27,948,761

Total difference $ 627,818

* Numbers subject to change after final audit in August.