The Freeport Area School Board has passed a preliminary budget that has a $1.5 million deficit.
Ultimately, the board will either have to come up with budget cuts or come up with money to close the gap, perhaps though a tax hike or using reserve funds, before passing a final budget by June 30. The state requires school districts to pass a balanced budget each school year.
Two school directors voted against the preliminary budget Wednesday, which passed 6-2. Board members John Haven and Rich Hill objected.
The state says the school district could raise taxes up to 3.1 percent without seeking voters’ approval in a May referendum. But the board reserved the option to raise taxes higher should it need to, without a referendum, by seeking an exception from the state Education Department. Referendum exceptions can be requested for paying retirement, construction or special education costs.
Hill said, “I would like to live within our means, and we already get a 3.1 percent (possible) increase.”
Business Manager Ryan Manzer said approving the referendum exception for the preliminary budget doesn’t necessarily mean the district will use it. He said it simply provides the district with an additional option if the financial picture looks bleak.
“When we get to the end of the (school) year, it allows us to go to the budget exception if we need to,” Manzer said. “Special education and retirement are the two that we talk about.”
He said the exceptions have specific threshold limits.
“It’s definitely not a blank check,” Manzer said.
“I don’t remember, since I’ve been on the board, ever using the exception,” Board President Dan Lucovich said. “We don’t always use all of the index limit.”
As for the preliminary budget, Manzer said it lists $33.9 million in expenditures and $32.4 million in expected revenues for a projected deficit of $1.5 million.
Lucovich said including the exception with the preliminary budget approval simply provides the school board with another budgeting tool.
“Always go for the exception,” Lucovich said. “There’s no reason not to.”