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Funding for schools might be cut to fix error

March 24, 2009|By HEATHER KEELS

WASHINGTON COUNTY -- Washington County Public Schools could be getting about $1.7 million less in state funding than anticipated next fiscal year if state officials decide to recoup funds previously given to the county by mistake, school board officials said Tuesday.

Last year, an accounting error led the state to underpay Montgomery County, Md.'s school system by about $24 million, which was distributed among other school systems, including Washington County's, said Chris South, director of budget and finance for Washington County Public Schools.

Upon discovering the error, the state opted not to recollect the money immediately, but recently there has been talk about reducing the overpaid counties' funding for next fiscal year to compensate, South said.

The school system was counting on getting about $2.36 million in additional state funding over the previous year, South said. If the $1.7 million is cut, Washington County schools would get only about $660,000 more than the previous year, he said.

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School system officials are nervous about the possible cut, which they learned about Monday, said school system Superintendent Elizabeth Morgan. Officials are developing a plan for dealing with it, she said.

Commissioner James F. Kercheval recommended that if the state decides to cut the $1.7 million, the school system could make up for it with reserve funds.

The school system has about $7.2 million in reserves but is trying to keep them intact for even more brutal economic situations anticipated in the coming years, Morgan said.

The discussion came during the Washington County Board of Education's presentation to the Washington County Commissioners of its proposed budget for fiscal year 2010, which begins July 1.

The system is proposing a $232.7 million budget.

Of that total, the school system is requesting that the county pay $88.3 million, or about 38 percent. Another $141.6 million is expected from the state, school system officials said.

The proposed budget is about $7 million higher than the current fiscal year's budget of $225.6 million, an increase of about 3.1 percent.

The increase covers raises required under labor contracts, new teachers and staff for the Barbara Ingram School for the Arts, additional special-education staff and clinical social workers, new buses and other additions, South said.

School system officials were able to reduce the increase from about $12 million to $7 million through cost-cutting and redeployments, South said.

Of the $7 million increase, only about $3.7 million would need to come from the county, assuming the $2.4 million increase in state funds comes through, South said. Another $354,000 of the increase will come from revenue from prior years' surplus, he said.

The commissioners have not approved the budget. A vote to approve proposed budgets generally occurs in June.

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