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Supervisors agree to $100k lump sum appropriation

The Westmoreland Supervisors met last Tuesday evening and agreed to comply with a portion of the county school division’s request for lump sum funding. Action was delayed on Feb. 8 because no one was present to represent the county’s schools when that matter was considered. A heavy snow event had made it impossible for some residents and school officials to travel to that nighttime Board of Supervisors meeting.
County School Superintendent Elaine Fogliani was present to defend the school’s position when the supervisors met in recessed session on Feb. 23. She explained that the division needs to be able to spend the money that is already in the contingency fund. If a broader lump sum funding accommodation cannot be granted, $100,000 to $150,000 of the sum already held in contingency must become available for expenditure or the revenue will have to be returned to the state when the current budget period ends on June 30, 2010.
Fogliani acknowledged the economic difficulties that are currently being experienced at every level of government. Economic conditions make it more important than ever to utilize the revenue that already is in hand.

“It has to be spent between now and the end of the [fiscal] year,” Fogliani said. “When we see we are not going to use it [in its designated line item category], we need to be able to move it somewhere else [where it can be spent], especially at a time when everyone is so tight for money.”
On Feb. 8 the county’s at large School Board member, Rosemary Mahan,  made it to the Board of Supervisors meeting, but arrived too late to represent the school division’s lump sum funding request. The matter had already been tabled when Mahan presented the case for lump sum funding during the meeting’s public comment segment.
According to Mahan, as a typical 12-month budget cycle approaches its final months, small amounts of money in line items that legally can be moved remain unexpended because the values are too small to support necessary purchases. Mahan delivered an example of a $20,000 sum in one category and a $10,000 sum in another category that a lump sum funding accommodation would allow school authorities to combine and use for some essential purpose. The absence of such an accommodation would result in loss of those unexpended revenues when the 12-month fiscal cycle ended.
On Feb. 8 District 5 Supervisor Larry Roberson expressed strong opposition to acting on the school division’s request for a lump sum funding accommodation. He cited a need to hear a designated school division authority defend the lump sum funding measure. When the discussion ended, the board voted to reject the lump sum funding accommodation.
Last Tuesday Fogliani explained that the School Board needs the Board of Supervisors to allow the schools to utilize $100,000 to $150,000 of the division money that is currently being held in a contingency account. The accommodation would allow the money to be spent before the current budget year ends on June 30, 2010.
“Money is tight,” Fogliani said. The action would allow the funds to be used where they are needed and failure to act would cause the state to take that money back.
Roberson, who was the most outspoken skeptic during previous discussions, addressed Fogliani.
“I really don’t have a problem with the school system doing this, but the trust factor doesn’t seem to be working correctly,” he said.
“Right now everybody is having a tight time with money. I recall that you wanted $85,000 for a concession stand. I remember all the time that was spent with the cafeteria stuff. We gave you the money, but it went elsewhere.”
“Not true,” Fogliani said.
“Three years ago we appropriated money for you to buy five buses. You bought three and the money went elsewhere,” Roberson continued.
“Not true,” Fogliani said again.
“There was money that went for concrete work and a planter, and we all have to be very careful with money,” Roberson said. “I am not raising people’s taxes. It was the state that cut your budget, and I feel there is a trust problem here.”
“You gave us the required local effort, which is separate from debt service and capital improvements,” Fogliani told the county supervisors.
“Without the contingency money we have this year, you can’t meet the required local effort. The stimulus money we received allowed us to save the paraprofessionals for one year.”
“I fight for the schools and for education more than anybody else,” Roberson responded. “I just can’t see how we can raise taxes with the economy in the condition that it is.”
“This coming year the required local effort will be less. Right now we’re third from the bottom of the state in terms of required local effort,” Fogliani stated.
“We spend just as much in this county as Spotsylvania spends per student,” Roberson commented.
“We’re a smaller division, with less economy of scale,” said Fogliani.
“The larger the division, the more efficient it will be. The smaller the school division is, the less cost effective it will be. We’re actually the largest school division on the Northern Neck.”
County Administrator Norm Risavi joined the discussion and attempted to explain the legislative change the Town of Colonial Beach and Westmoreland County caused the General Assembly to adopt 10 years ago in hopes of resolving longstanding budget difficulties associated with the funding a separate school division in the town.
According to Risavi’s explanation, no other Virginia jurisdiction encounters the budget difficulties associated with the separate Westmoreland County and Town of Colonial Beach school divisions. In other localities, unexpended revenues “revert back to the general fund when a school division did not spend all its funds.
“Here,” Risavi explained, “we transfer half the local share to [each of] the two school divisions because we have two school divisions [instead of one].
“Funds like the state sales tax are remitted on an accrual system. Grant funds aren’t received until they are spent. We have to spend the local funds and then we receive the grant funds. They often aren’t received until up to six months later.
“This is not new local revenue that the county is being asked to give to the school system. We used to run into a problem when the county school system didn’t spend 100 percent of its revenue. When our audit would come in we’d find that Colonial Beach owed the county a tremendous amount of money,” Risavi said of the difficulties that prompted the town and county to initiate the statutory change 10 years ago.
According to the procedures currently in place, the county “collects the money that has to go to the school. There is over $700,000 in the school system’s fund balance,” he continued. “State code allows them to use that contingency. It’s OK as long as the school notifies [the county government]. Then we are in a much better position to move forward.”
At that point in the Feb. 23 discussion, Board of Supervisors Chairman Woody Hynson asked for a motion to approve the school division’s lump sum funding request.
Fogliani returned to the discussion and explained that the school division “needs to have [the money from the contingency account] in place by April 1, so we can get a bus.
“Last year,” said Fogliani, “we had a problem spending the required local effort. We didn’t have enough money in transportation and we are behind on our bus replacement schedule. Buses are counted as local effort and a bus will cost about $75,000. We’ve been told there will be no money for buying buses in next year’s budget, and if we don’t move it [by April 1], it goes back in the fund balance.
“No,” Fogliani said to Roberson. “It will not be used to pave a parking lot. All you’re doing is moving it up and making [the process] more flexible. The auditor recommended this. If we don’t do it, we will have to send it back to the state.”
District 3 Supervisor Lynn Brownley weighed in.
“We created a special school district for Westmoreland County and the Town of Colonial Beach,” he told Board colleagues and the Feb. 23 audience.
“The real estate tax rate for the school in Colonial Beach is 26 cents and it  is 50 cents for the county. It is true that the school system is the county’s number one responsibility as defined by the Virginia Constitution.
“It’s also true this is an absolutely disastrous budget time that was made worse because we tied capital improvements to a developer and to new development. Now we find ourselves in a situation with the cat chasing its tail. We need to have the state assess this county’s land use values” when it computes its level of support to the Westmoreland County schools. That would at least account for the money our county is unable to collect.”
Others participating in the discussion understood Brownley’s comments as referencing the state’s composite index computations. Minimum necessary support of local support for town and county schools is derived from composite index values. The computation takes into account family income and the value of land. Assessed values are used, not the reduced land use values that cause properties in active forest and farm use to be discounted for local taxation purposes.
According to Risavi, land values and income levels in Westmoreland fell during the past 12 months. As a result, the minimum level of local support for county schools has dropped approximately $180,000. The state contribution will offset the reduction in local funding. Even so, the county school division has been told to expect a $1.7 million reduction in state and federal contributions during the 12-month budget cycle that begins on July 1, 2010.

 Betsy Ficklin
Staff reporter

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