Analyzing LISD Maintenance & Operations Funds

Maintenance and Operations Funds are generated to fulfill the operations and maintenance of the local school district. The Superintendent had given me the opportunity to participate in a web conference with him, and the business manager to learn about projected funding, and the revenue the school district had received from the state. Since we have a new Superintendent as well as a new and inexperienced Business Manager, the district has contracted with an outside professional to assist in projecting revenue and understanding the Summary of Finance. In the discussion, it was learned that our school district has been overpaid through the Foundation School Fund, and the district will have to “pay back” funds to the state. I examined the information that was provided by our budgeting expert and compared the information to the Near Final (NF) information from the 2010-11 Summary of Finance and the Comptroller of Public Accounts information from the Property Tax Division.             The main source of revenue for the district is through Foundations School Program (FSP). Last school year, we were paid $ 16,220,516 with the FSP, however, through projections; we will have only earned $ 15,268,821. This reflects a revenue shortfall of $ 951,695 that will be returned to the state. However, in the discussion we determined that the new I&S tax rate was not included in the figures, so we are expecting a smaller return to the state. It was further explained, even though the I&S tax rate has changed, the M&O tax will receive a fractional part of the funding. Additionally our local M&O tax rate of 1.04 generates approximately $ 8,936,439.             The total M & O revenue for our district is approximately, 25.1 million dollars. The main areas of revenue generated come from the regular program allotment of approximately 17 million dollars, the special education adjusted allotment of approximately 2 million dollars, the career and technology allotment of approximately 1.6 million dollars, and the compensatory education allotment of approximately 1.3 million dollars.             Overall, the district is not a wealthy school district from the standpoint of tax collections from business and industry. The district is considered one of the smaller geographical districts within the state, and the sole source of tax income originates from homeowner property taxes. The values of homes in our school district are slightly higher than average, which does assist the school district with tax funds. The school district has to work hard in managing and ensuring funds are budgeted in a manner that reflects responsible spending. After speaking with our hired expert, we have learned to budget what we expect to earn, not what is paid by the state.