DALLAS -- The dreary financial outlook for Dallas schools is likely to continue into next year.
The Dallas School District is projecting it will have to cut more than $1.2 million from its general fund next year to balance its budget and maintain an adequate contingency fund.
District staff estimate the general fund expenditures at about $24.36 million for the 2012-13 school year. Projected resources for the school year total about $24.15 million. The district is hoping to hold $1 million in reserve for unforeseen expenses, leaving a sizable gap to fill.
Tami Montague, the district's business manager, said the funding shortage stems from spending the last of the federal stimulus money and that the state school fund is projected to drop slightly. The district's declining enrollment also continues to be a concern, as funding is tied to the number of students enrolled in the district.
"I wish I could say it was better news," Montague said at a recent Dallas School Board meeting. "I can't say it was unexpected because of losing stimulus funding and the state school fund is flat."
Superintendent Christy Perry said she hopes the $1.2 million figure is the district's worst-case scenario, barring any major changes in the state's economic outlook.
Last year, the district had to cut $2.5 million in programs, positions and school days.
The $1.2 million estimate accounts for no days being cut from the school year. Given the size of the budget deficit, though, Perry said it is likely some days will have to be cut from the 2012-13 schedule.
She said the district has implemented a spending freeze and is looking for areas of potential savings during the remainder of the current year to ease the pressure on 2012-13.
"We're really looking at our (student) transportation contract," Perry said. "We are seeing some savings there."
She said declining enrollment and inadequate state funding continue to be major concerns to the district's financial outlook.
Enrollment reports show the number of student in higher grades outnumber those in lower grades, meaning with each year, there are fewer students attending Dallas schools. In February of 2010-11, the district had 3,098 students attending. In just one year, the number has tumbled to 2,981
Perry said she believes the loss of major employers in the area in recent years is the reason for the decline and doesn't see the trend reversing until the local job market improves.
Dallas has taken an $80,000 hit this year, due to fewer students attending. Perry said the district may lose another $80,000 to $90,000 in 2012-13.
Montague said according to the latest state school fund estimates, the district will see about $234,000 less than this year.
Dallas receives a very small amount from federal timber payments, but the loss of the funding, if not renewed, would be yet another factor. A number of school districts in Oregon receive a considerable amount of their funding -- if not all -- from timber payments. Funding for those districts would have to be provided by the state if the payments end -- which would lower the per-student amount each district is paid. Montague isn't sure how much of a reduction that could entail yet.
"Depending on what the impact of this is, we are going to see a difference," Montague said.
Looking ahead, the district also has to keep in mind an expected $500,000 increase in personnel costs due to a PERS rate hike in the 2013-14 school year.
Perry said the district's employee unions have in the past agreed to salary reductions to help the district cover PERS costs and have been more than cooperative with budget reductions in the last three years.
Asking for more concessions may be difficult, as there is a possibility the district will have to cut days from the schedule again, which means staff pay cuts.
"I think our employee groups have been understanding of the situation we are in," Perry said. "There is an attitude of `We are all in this together.' They worked well with this."
Perry said beyond anticipating cutting school days, the district has not identified where reductions will be made. She said the district will work with its Finance Committee to craft a plan to deal with budget shortages.