FSCC budget includes improvements money

Friday, August 2, 2013

The Fort Scott Board of Trustees, after their first in-depth look at the proposed budget for 2013-2014, approved a published budget number of $2.962 million in local source funding for that period.

As FSCC President Dr. Clayton Tatro explained at Monday night's meeting, the published number is the highest number the budget can go. But the final budget number for local funding can be lower.

Having the higher figure, "gives us some room for healthy discussion," he said, and an opportunity to consider various options, including several capital items that include relocating the School of Cosmetology to campus at a new facility, and improvements to the parking lot and the Round Room.

The board was also working on a mandatory Aug. 1 deadline for publication.

"I'm looking for some consensus on the maximum dollars we could tap for the budget," Tatro said. "We can go lower but we can't go above. We need to publish a number high enough to have a discussion going into our budget hearings" and to expand programs if the revenue opportunity is there, he noted.

"If we don't have the additional revenue, we're not going to spend the additional money."

Tatro told board members he believed "we have been efficient in our budgeting.

"Prior to the 2007-08 school year, we spent beyond our revenues. But the last six years, we haven't done that."

With three new board members in attendance for their first meeting, Tatro noted that, "Last year, the board approved a budget based on flat enrollment."

But that didn't come about.

"We've been seeing smaller high school class sizes," Tatro said. "We have competing institutions, and there are more online offerings," resulting in more competition for fewer students.

"By the October certification date (last year), our enrollment was down seven and a half percent."

The school had already increased tuition and fees, Tatro said.

"So at that point with enrollment down, we had a conversation with our administrative team," Tatro said. "One of the things we did was look at everyone who was not under faculty contract. So we made a mid-year 5 percent reduction on our staffing, taking people to a 38-hour work week for January through June."

"We also restructured a department," Karla Armstrong, board clerk and information officer, said.

"This year, we felt comfortable enough to restore that," Tatro said. "And we did that with the July paychecks."

Looking to this budget cycle, he said, "This year, we're expecting flat enrollment, based on where we were last year. Our summer numbers were good, although our early fall projections are shaky."

Tatro told trustees that this "working budget" restored these earlier staff funding cuts and also included a cost of living adjustment.

Summarizing various budget items, he said, the plan is to include a faculty and staff cost of living adjustment that would total $104,980, as well as restoring not just the $60,000 in salary cuts but also the $200,000 in operational items from a year ago.

During the discussion, board members Mark McCoy and Dick Hedges said the full amount of the $200,000 for the operational items might not be needed, citing this as an area for more study during the continuing budget process.

As the board reviewed the budget, Tatro reminded members that, "we don't set the mill levy. It is calculated from that total dollar amount."

In reviewing the funding sources, and prompted by a question from the board, Armstrong and Tatro explained their understanding of the process on the county end, in terms of receiving the various tax funds in revenue.

"The county will give us their best estimation of where things will end up," Armstrong said. "It may be that these funds will come in higher than they estimated."

Trustee John Kerr asked how consistent the motor vehicle revenue was, noting that there had some sizeable swings, most notably the 2012-2013 year's unaudited numbers appearing to come in considerably higher than last year. The 2011-2012 number was lower than any year in the past six, prior to the apparent jump this year, according to figures presented to the board.

In preparing the budget, state and local revenue numbers were expected to be flat, Tatro said.

"Property valuations are expected to be down but motor vehicle taxes may be up slightly," he said.

Last year's budget number for local funding, based on flat enrollment, and that was published in the hearing notice for the 2012-2013 year, was $2.419 million.

The board packet included a graph depicting the local source percentage of revenues without auxiliary funds and comparing other Kansas community colleges, compiled by the Kansas Association of Community College Business Officers.

That chart showed FSCC at 22.9 percent for the 2011-2012 year, lower than all but Allen County, and compared to a state average of 38.1.

A companion chart of student source percentage of revenue without auxiliary funds showed FSCC at 41 percent for that same time period, compared to a state average of 26.2.

"We're more dependent on students as a source for revenue," Tatro said.

The board packet showed a mill levy comparison, with Fort Scott coming in at 25.362 for 2013, lower than all but eight other schools of the 19.

"We know we have a lower mill levy compared to other community colleges in Kansas and the second lowest cost per full time equivalent in Kansas," Tatro said.

The cost per student FTE showed 6,628, compared to an average of $10,861, with only Allen County lower.

Fort Scott could go lower if it were to concentrate on general education classes, Tatro said.

"It costs us more to offer the work type hours (with vocational and work emphasis programs) versus general education hours," Tatro said. "But we're OK with that. There's not the same return."

In looking at this year's budget, Tatro said, "We've got to look to the future. We've put money back in," for the maintenance items that had been taken out of the budget over the last six years "when we didn't have the dollars."

A budget summary showed $18,000 slotted for a welding position, although most of the money to pay for the instructor would come from various grants, Tatro said.

It showed $75,000 for truck driving equipment.

"That's for transmissions and tires primarily, things that we've deferred for so long that now, it's a safety issue," he said.

Under identified campus projects, the budget summary projected $400,000 for the Cosmetology build out, and $200,00 for Cosmo equipment leases.

Parking lot repairs were estimated at $530,000 and repairs and improvements to the Round Room at $150,000.

"We have so many needs," Trustee Jim Sather said. "We've got insurance costs increasing, we've let our trucks go, and we've let our parking lots go.

"We have to be competitive with other schools or we lose students and that costs us."

"To have the occupational programs that we have, we've got to have equipment and we've got keep that equipment current," trustee board chairman Robert Nelson added. "And we can't keep putting funding pressure on the students. If we drop programs, that affects enrollment as well."

Trustee John Bartelsmeyer pointed out that if the facility is going downhill, then graduating students would tell others that the education was great but the facility wasn't.

"It's time to do something," he said.

"We're funding the city and the county, why not the college?" Tatro asked.

"The board has prided itself on keeping our mill levy low when maybe we should have been raising it incrementally along the way," Nelson said.

Kerr said he believed it was "important to look at what the community can afford. We have to be mindful of that economic health."

Trustee Mark McCoy offered a $2.962 million figure for local funding, taking last year's $2.419 million and adding in the budget document's expected expanded local funding of $543,000, "as a maximum funding request" for publication.

After additional discussion, the motion passed, with Kerr voting against it.