School Board projects multi-million dollar deficit following revenue decreases
Published 12:00 am Wednesday, December 23, 2020
LAPLACE — The St. John the Baptist Parish School Board will need to implement cost-saving measures to recoup millions of dollars in revenue decreases for the 2020-2021 fiscal year.
The original 2020-2021 budget projected a $2,747,208 surplus for the fiscal year. However, a combined $9,750,927.11 in revenue decreases between ad valorem tax and MFP contributed to a projected deficit of $7,003,719.11 in the budget.
Additionally, finance committee member David Andras received a report Monday stating that, as of the month of November, sales tax revenues are down roughly $3 million compared to last year. That equates to about a $1.4 million deficit to what was projected in the 2020-2021 budget.
With the ongoing COVID-19 pandemic, it is predicted the sales tax deficit will become $2 million to $3 million by the end of the fiscal year, potentially leaving the St. John School Board with an overall $9 million to $10 million deficit.
During a finance committee meeting held via Zoom on Monday, Superintendent Dr. Lynett Hookfin shared that administration recently became aware of an issue regarding the tax millage, which contributed to the revenue decreases.
In September 2020, the School Board advertised a public hearing to be held on Oct. 15 in Reserve in which School Board members would “consider levying additional or increased millage rates without further voter approval or adopting the adjusted millage rates after reassessment and rolling forward to rates not to exceed the prior year’s maximum.”
However, the School Board cannot roll forward with the increased millage due to the way in which it was advertised.
“Last week, we received a message that we would not be able to roll forward from JoAnn Garrison, who reviewed our items at the state legislative office,” Hookfin said. “She said it was not placed in the correct section of the newspaper, although it was placed in the same section of the newspaper that it was last year (public notices).”
Another factor of revenue decreases for the fiscal year was a drop in enrollment during the COVID-19 pandemic.
Hookfin continued to explain the implications of the revenue decreases.
“What this means for our great district is that we really need to be strategic on how we can save,” she said, adding that administration has done a wonderful job of creating a lengthy list of cost-saving ideas.
Some of the ideas discussed at Monday’s finance committee meeting included closing Central Office positions that are not currently filled, cutting back on food and travel expenses and temporarily freezing purchase orders on items such as school lunch, fuel/buses, PPE/COVID supplies and emergency maintenance.
Administration is exploring options of operational loans that would need bond commission approval.
Other cost-saving ideas shown on a PowerPoint during Monday’s meeting included involuntary transfers in the district in order to fill current vacancies and furloughs, which would create a savings of approximately $300,000 to $400,000 per day.
Andras said furloughs are not advisable from a financial standpoint, stating, “If you look at your deficit, that would help some but not a lot.”
Finance Committee member Ali Burl III reminded those in attendance that furloughs cannot move forward without union approval.
It takes approximately $6 to $7 million to operate the School District each month, according to Hookfin. She said cutting vacant positions at Central Office would be the likely starting point to avoid making impacts at the campus level. Food and travel expenses could be another starting point for cost savings.
“These are not all of our ideas,” Hookfin said. “We have many on paper that we will forward to the Board. The charge will be for us to save and plan ahead for the next financial year.”
The St. John School District is currently operating without a Chief Financial Officer. Sara Loupe was hired as CFO earlier this year but has since left the position.
Hookfin reported that five applicants were interviewed for the position on Monday of this week.