001I call to order this meeting of the Kawita County Board of Education called agenda 860 6:30 p.m. May the 19th, 2026. Please rise for the pledge of allegiance and a moment of silence to the flag of the United States of America and to the for it stands one nation indivisible with liberty and justice for all. >> Thank you. May be seated. I have a motion to approve the agenda. >> Second. >> Any discussion? All those in favor? Motion passes seven to zero. Dr. Horton bud budget work session. >> Thank you, Mr. Chair. At this time, I'll call on assistant superintendent for finance, Mr. Keith Chapman to bring you your second budget workshop. Mr. Chapman, >> our second workshop. A couple of notes before I get started. Uh this is the general fund fund 100 only
002that we're discussing tonight which we have the control over. It's not federal funds, not school food, not special ed. Uh the main difference where we'll see tonight, we did receive our state numbers late Friday afternoon. The main difference was in our local fair share. We went from a slight decrease to a slight increase. Made about a $250,000 difference uh reduction in our revenue. But um as we've done before, we start with our current year FY26 revenue number 312.3 million. Take our 26 original allotment. We have a KB increase of 3.6 million. Like I said, small increase in our local fair share, which is a negative toward our revenues. Transportation, we saw a small increase. The literacy coaches is new. Small nursing decrease, looking at right at 149 million for state revenue, $4.5 million increase there.
003Uh since we had a slight decrease in enrollment, we reduced our uh projected midterm adjustment which is where the state makes us whole middle of the year. Federal indirect cost that varies from year to year based on the federal programs and the budgeted expenditures. We see a small increase there. The mental mental behavioral health services is a new program. If you'll notice there's a difference between the prior time prior sheet prior the mental behavioral health was where literacy is up above literacy was down here. They changed in the interim how those were being sent to us. Um same numbers just different locations in the sheet. U slight increase in our bus replacement slight increase in the school safety grant. Uh there was an additional safety grant, security grant last year. Uh that went away for
004this year. That's why you see a $600,000 decrease there. Custodial supplements change slightly. Other state grants uh down about 63,000. Projected interest is down about $400,000 due to lower reserve balance and slightly lower rates. Uh tidleum tax, we project a slight increase there. or other taxes such as intangible based on current year about a 1.6 million increase there. Miscellaneous receipts again based on current year about 250,000 increase there. Uh when we adopted the miller rate last year was adopted lower than what we had budgeted at. So there's a decrease related to that. Uh we've projected a 6% growth in the digest, a loss of revenue of $7 million related to the senior exemption, and a projected increase in utility taxes of 3 million based on information from the tax commissioner. Uh projected revenue increase is
0058.3 million. Projected revenue for FY27, 320, 527, 650. expenditures. Uh there have been no changes in expenditures since the prior meeting. Uh $321.8 million. We're budgeted in reserves now 1,ion254249. We had just been a few dollars under a million and again that's related to the change in the local fair share. Um salaries and benefits 291.6 million 90.62%. personnel changes, uh, state healthc increase yet again, TRS rate increased, ERS rate increase. We have one employee under the ERS plan. Uh, we had steps from for certified employees, steps for classified, steps for administration. We added the 19 lit literacy coach positions. And if you'll notice, there's about a million dollar difference between what it's projected to cost us and what the state's funding us. We have several vacancies budgeted for next year. Through a attrition, we're reducing
00647 teaching positions. No one is losing a job. Uh bumping up our additional pay for additional time on bus drivers and bumping up additional substitute costs. You'll notice there are four numbers highlighted. Those are numbers driven by the state's decisions, not local decisions. Other major change uh just due to the ongoing increases in cost, particularly benefits, increasing the amount we transfer to school food service by just under $2 million. >> I got I got a quick question. What is the bus driver additional pay? Is that for like >> when they run have to run a second route run? They're guaranteed five hours a day. If they have to run time past that, they're compensated. >> All right. Thank you, >> Mr. We do for the majority of it, but we it varies from year to
007year how much we receive from the state. Some years it's like this, it's a small number. other years it's more significant. Um but no, the majority of it is paid through East Boss. Look at our major operating items under the expenditures. Um very similar to prior year. The biggest change there would be transfers is moved up with the amount of money being added for school food service. Uh you'll notice there's really not anything there we can do without uh move down. Um major items we're looking at $29.5 million 9.18% all other operating expenses $645,000.2%. Uh percentage increase from FY26 is 2.87% in the expenditure side. projected reserves to start the year at July 1 as 42.9 million. It's 13.33% of our budgeted expenditures. And on the horizon, as always, we're looking at maintaining health through
008reserves. And since it's been signed, we have to look at the impact of Senate Bill 33. >> I have another quick question on UG Georgia best for our money that we get. How many do we put through there per year? >> Uh, right now we have a cohort of 150. It's a two-year program. 150. >> Thank you. >> Should turn my mic on. I'm sorry. This is our second cohort uh Georgia's Best. So, we will be um approximately 300 teachers at the end of next year who will have received advanced degrees as part of that program. >> Thank you. >> In exchange for five years with the district. Any other questions, board members? >> All right. I just want to make a make a couple of comments uh related to the budget. Uh even with
009the with the local fair share change uh and us being just over $1.2 million, it's still u the the lowest amount that I can remember uh us being budgeted into reserves going into a fiscal year. Just for context and comparison, I think this year we're right at 3.6 6 million into reserves. Uh want to want to stop for just a moment and talk through or talk about uh the reduction of 47 teaching positions. Uh this is largely for structural reasons. Um remember four years ago we redistricted students from East Kawita to Northgate approximately 500 students. There was an extended grandfathering process a part as part of that. We wanted East Kawita students that wish to remain at East Kawita to be able to do so and finish their high school career. We've just completed that
010grandfathering process. Uh the net result of that was uh that both East Kawita High School and Northgate High School were overstaffed to a degree for the last few years. So this is this is the year where that kind of comes home to roost. Also Nan High School, we had to run two campuses uh after Nan High was destroyed by the tornado. uh Cougar Village and Nonan High. So that required some additional staff made the choice as they assimilated back together and into the new building to leave the additional staff in place. So this is also the year where we're contracting some of that staff. I think it's important to mention um class size resolution that you approved last month. There are no increases in class size. Um, we I wouldn't bring a recommendation to you
011unless I absolutely had to of 47 reduction of teaching positions if we had to increase class size. Our class size ratio hasn't changed since I can remember. Uh, so I want to dispel that and also want to reiterate what Mr. Chapman mentioned earlier. All of this was done through natural attrition. We didn't go to anybody and say you're not going to be with us anymore. Um, so all of this was done through natural attrition. Mr. Chapman mentioned some of those state increases that were highlighted in yellow uh for benefits, TRS, literacy coaches, which were partially funded by the state. They funded about half of those. Um, we've got $5.8 million in this budget in increases that are due to state mandates. No control over $5.8 million. The only local choices that we have here in
012this budget are increases to transportation, which Mr. Chapman mentioned a few minutes ago, some additional substitute funding, and step raises for classified and administrative employees uh that are eligible for them. All that to say, it's a 2.78% uh increase in our expenditures from FY26 to FY27 is what we're budgeting. um that's lower than the rate of inflation. I think it's really reasonable for where we are in light of some of the partially funded and unfunded mandates that we see that are coming down to us. I also want to reiterate that this budget is based on maintaining the current millage rate at 15 mills. We we do a budget on a projection every year. So, we're we're budgeting based on maintaining that rate. I'll remind you once again, you probably get tired of hearing me saying
013it, it's one of the lowest millage rates you're going to find, probably the lowest in the metro area. Uh, so we're maximizing every every penny that we get. Mr. Chapman mentioned in his in his on the horizon portion there, um, Senate Bill 33, which the governor signed last Monday, and I promised you last Tuesday that we would talk more about it here in the coming months. And what Senate Bill 33 does is Senate Bill 33 caps taxable assessment value of homestead properties at 3% or the rate of inflation. Board members, one of the things that I did um along Mr. Chapman and Mr. Latimer was last fall we requested that Malden and Jenkins would do an independent audit for us of at that time House Bill 581. You may remember there was a there was
014another bill that came out of the house, House Bill 92. uh that would have required us to go through the House Bill 581 opt out process again that we went through last year. So I asked Maldin and Jenkins to to do an independent audit for us uh to to check our work uh and see how accurate we were in our projections about what we thought uh House Bill 581 would have meant for us over the last several years and moving forward. Um, I did that. Number one, we need to make sure that that everything we do and every recommendation I make to you and every decision you make is rooted in fact. So, I wanted us to have independent information that we knew that was factual. I also wanted to do that because the impact
015of 581 and the impact of Senate Bill 33, um, it has a strong residential impact. When you have a school system where 70% uh of our tax digest is concentrated in residential properties, homestead properties make up nearly half 48% of the total base of the tax digest. Um, that's important because it has it has a a more of an effect on you uh when you're looking at your revenue picture, especially when historically housing appreciates, residential housing appreciates faster than the rate of inflation. Uh, and then capping the taxable growth of that is going to create a compounding revenue deficit for us. Okay. So historically they look back from 2019 to 24 uh and they use a conservative 5% cap number in their study. If a 5% cap had been in place from 19 to 24
016we would have lost 49.3 million in cumulative M property tax revenue. That's at 5%. I say that to you because SB33 has a 3%. Means even less revenue. Okay. If you look at the projected deficit of this independent analysis looking forward from 2026 to 2020 2030, excuse me. And this was based on 581. opting into the cap uh is projected to create a cumulative maintenance and operation revenue shortfall ranging from $68.9 million. That's a conservative 8% growth scenario. So 8% digest growth. I remind you we just did our budget a few minutes ago based on six. So we're a little bit more conservative on the revenue side. to $134.5 million cumulative loss which is in a 15% digest growth scenario over the next five years. I say all that to you. It's important that we
017consider uh the impacts of the potential impacts of Senate Bill 33 as we look to budget in the future especially in the context of expenditures that are increasing every year. Just mentioned to you 5.8 8 million of increases came to us without any local decisionmaking whatsoever. So it's important to to consider that expenditures are going to continue to increase. We also have to considered in the context of a lesser percentage of our funding coming from the state each year and more funding pressure being placed on us here locally. It's also important in this discussion as we move forward are the current exemptions that we already have in place and the impact that they have from a revenue and a budgeting experience including the increased senior exemptions which Mr. Chapman um mentioned are going into into
018place July 1. Uh that we're anticipating or estimating will have uh a $7 million net negative effect to the budget. going to have to carefully consider and manage all of this in the coming years. Um there will be um there will be hurdles that we have to overcome uh from a from a revenue standpoint especially to maintain our current educational service level. Um you have a compressed homestead digest. Uh we're going to have to take a hard look as we move forward about about what it looks like for us. Good news is this budget has been prepared on a 15 mil millage rate for the coming year. Um SP33 was just signed last week. We're going to learn a lot more as we go. I'm going to bring you more information, of course, as we
019move into millage rate season about what it means, but I wanted to make sure I got everybody's wheels turning on it because it is going to it's going to have implications for us uh as we as we seek to do our job, which is to educate our students here in Kawi County. um and provide the service that our community expects and demands of us. Uh so unless anyone has any questions, >> I got a question in in Senate. Oh, sorry, Rob. >> Oh, go ahead. Go ahead. >> In Senate Bill 33, W wasn't there some specific guidelines about millage rate. Do we know if we're going to be allowed to set them because there was some control over in Senate Bill 30 the language? >> My understanding is we will still be allowed to set
020our rate. Yes. Remember though, you got a 20 mil cap and we're we're very fortunate because we have more wiggle room than some others may have with higher rates. >> But if I understand it, Senate Bill 33, it basically replaces 581 and kind of puts everybody in that they had opted into 581. I mean, it's it's it took away that option that the voters gave us. The um the one thing 581 provided to local boards of education was the local autonomy and control to make the financial decisions for its school district that it felt best to make. Senate Bill 33 removed that local control. >> Mr. Dubos, I'm sorry. So, I I was going to say I've seen some ads for the governor's race here, lieutenant governor, claiming that we're going to do away with
021property taxes. We'll cut property taxes in half. Have you heard anything about how they're going to make that up for education funding? >> I have not. So, >> no, sir. I haven't heard any specifics. Um and and best way I can put this, no one's asked my opinion on Senate Bill 33. Um and about what the potential impact of it would be. Um no one no one locally and no one at the state level asked me what I thought. >> I would agree with that. Um, Senate Bill 33 also with our local fair share because I know you have it that we it was an increase for us that also comes from Senate Bill 33, correct? Because they're going to limit what we can share in >> the the difference in between 581 and 33.
022Currently, our local fair share comes off of the gross digest number. >> Yeah. Uh in 33, one of the provisions that was written in was now is now that the local fair share will come off the net digest. Um another another piece of that or similar piece of that in 33. Currently, we're limited by state law to only be allowed to maintain 15% of our general fund um budget in reserves. We're currently at 13.33 in this budget. One thing that Senate Bill 33 does, Senate Bill 33 does allow us to take our reserve amount from 15% to 25%. I will say though, board members, >> you don't have any money. >> I I that is going to be a very challenging thing to do with revenues that are constrained. Um so, um >> let you
023increase it with >> Again, there are a lot of things that we're going to have to consider moving forward. I wanted to get you wheels turning on it because um it it takes effect in July and uh we're going to have a going to have a lot of conversation we need to have over the course of the next year about what it looks like from a from a I don't want to be gloom and doom um but I do want to make sure that that I'm doing everything and that we're doing everything that we can to prepare this district to move for the next five years to a decade. So >> Mr. Debos, on your question, I did hear from a couple legislators. I know there was some talk of increasing sales taxes. Now, whether
024that has any legs, if you know, obviously nothing is concrete if that goes anywhere. >> There were >> absolutely no idea. >> There were some some elost and other things that were in Senate Bill 33. Those are not available to school systems, though. >> They're only available to cities and counties, to municipalities. Any additional discussions, further questions?