Budget reflects economic reality

Published 12:00 am Thursday, February 28, 2002

By Christopher Lenois

RESERVE – The 2002 budget figures for St. John the Baptist Parish schools reflects the reality that most businesses have faced during the last two years – the boom is over. Unlike at many businesses, however, the school board members are not anxiously tugging at their collars over the bad news.

No one on the school board reacted with surprise when Executive Director of Business and Finance Felix Boughton stepped to the podium at Thursday’s board meeting and announced a $1.6 million drop in revenue from fiscal year 2001. Such a figure could be construed as more dramatic than Boughton’s understated, “It’s not as rosy a picture as we’ve had in the past,” comment if not for the fact that the board had been anticipating this for some time.

In fact, as Boughton pointed out, this is exactly why they’ve built a $6.7 million surplus during the past few years.

“I’m not upset at all,” said Russ Wise, the District 8 representative. Wise said construction projects over the past two years had bumped up sales tax figures more than normal, allowing the board to build the surplus. “We’ve planned for this. And there will be absolutely no reduction in the quality of education,” he said.

Boughton predicted the board could operate comfortably for three to four years on the surplus without budget cuts.

Not that the board intends to rest on its laurels. The questions are where to cut expenses and where can more revenue be found. Salaries are the largest expenditure by far, points out District 9 representative, Lowell Bacas. Recently the board approved a salary increase that made St. John Parish teacher’s salaries eighth highest in the state. Bacas, a former principal in the St. John school system, considers this critical.

“Qualified educators will look at all the parishes and see which ones pay the best, and go there first.” he said.

The major initiative for cost-cutting has been in energy use. St. John Parish is the first school system in Louisiana to use Qualified Zone Academy Bonds. The bonds allow it to borrow money at zero interest, with the annual payments going into an escrow account. When the debt is repaid within the 10-year period, the school system gets to keep the interest accrued in escrow.

St. John has used the bonds to make facility improvements that reduce energy costs. Boughton said it has already saved more than $100,000, and will eventually save more than a $1 million.

“Essentially the school system gets a free face lift,” said Boughton.

District 5 representative Dowie Gendron pointed to the overtime pay for the maintenance department as another area where costs can be reduced. Superintendent Michael Coburn explained that the higher than expected overtime costs were due to the excessive work required last July to get schools ready for the 2001-02 school year – efforts that will not need to be duplicated this coming summer, he said.

Boughton and the board members are quick to point out that the need to dip into the surplus is not a result of frivolous spending, and that finding new sources of revenue is difficult.

“We really only have one place to generate more revenue, and that’s auditing sales taxes,” said Clarence Triche, the District 7 representative and chairman of the finance committee. Triche said Boughton’s office publishes a monthly newsletter that tracks industrial productivity and retail sales, and both have been on the decline in recent months. Boughton said that sales tax revenue is expected to increase again when a new utility company begins operation. Also, increased production from one of the area businesses is anticipated by 2006, which would increase sales tax revenues as early as 2004.

Wise pointed out the surplus itself is also making money.

“We’ve put (the surplus) in the highest interest bearing methods allowed,” Wise said. “We don’t have a lot of places to raise money. So we have to take a ‘penny-wise, pound-foolish’ approach.”

Increased enrollment brings additional funding from the state government and 240 students dropped out of the St. John public school system last year, Coburn said, resulting in the loss of hundreds of thousands of dollars. But as Triche pointed out, additional students also bring additional costs.

Still, the school board for the first time has hired a public relations consultant, and are advertising and hosting open houses to compete with the private and parochial schools for students’ attention.

“We can go head-to-head with them in terms of test scores now,” Wise explained. “We don’t want to inflate our bubble necessarily, but just let people know the good stuff.”