Home News RICHLAND TWO SCHOOL BOARD APPROVES ALLOCATIONS OF BUDGET SURPLUS

RICHLAND TWO SCHOOL BOARD APPROVES ALLOCATIONS OF BUDGET SURPLUS

1/8/2020

COLUMBIA, S.C. — At the January 7, 2020 special called board meeting, the Richland School District Two Board of Trustees approved a proposal to allocate the $16.9 million surplus from the Fiscal Year 2018-19 General Fund Budget. The allocations include:
·         a one-time General Fund Budget allocation of $25 per student to supplement schools’ discretionary instructional allocations for classroom supplies and instructional initiatives. The estimated cost of this investment is $750,000.
·         a one-time General Fund Budget allocation of $25 per student to media centers for updating circulations and providing additional media supplies and resources. The estimated cost of this investment is $750,000.
·         a one-time bonus of $1,000 to all full-time permanent employees. The estimated cost of this investment is $4,100,000, which includes related fringe.
·         $3.5 million for the Building Fund to help lessen the impact on taxpayers for the funding of annual capital improvement expenditures.

At the December 10, 2019 board meeting, the district’s auditor presented the Comprehensive Annual Financial Report based on an audit of the Fiscal Year 2018-19 General Fund Budget. The auditor reported that the district ended the budget year with a $16.9 million surplus, which is about six percent of the 2018-2019 budget. The source of the surplus was a combination of $9.3 million in lower expenditures than budgeted (primarily in salaries and fringe benefits) and $7.6 million in higher than anticipated revenues ($3.6 million in local taxes and $4.1 million in state revenues).

At the January 7, 2020 board meeting, Dr. Baron R. Davis said, “In the past few years any budget surplus was rolled into the district’s Fund Balance. However this year, district administrators are proposing allocating the surplus to make investments in our students, employees, community and future. The proposal supports our district’s strategic plan, mission and vision.”

The remainder of the surplus will roll over to the district’s Fund Balance to ensure Richland Two maintains a fiscally responsible level of reserves (which is the equivalent of approximately 2.5 months average operating costs). An adequate Fund Balance is necessary to ensure financial security during the first six months of the school year, when state and federal revenues decline and local revenue is minimal. This would prevent the district from having to issue a Tax Anticipation Note, which ultimately costs the district money in the way of interest and issuance costs.