District targets reductions of $1.8 million from 2009-10 budget
Officials prepare for more cuts with no new state funding

May 22, 2009

Bloomington Public Schools will reduce its 2009-10 operating budget by $1.8 million, and can expect additional cuts the following year as a result of state school funding being frozen over the next two years. The District is preparing for budget shortfalls and staff layoffs for the foreseeable future.

The budget recommendations include over $687,000 in staffing and program reductions next year, including the loss of 12 full time equivalent positions. Those cuts, coupled with $853,000 in revenue enhancements and $230,000 in budget shifts account for the $1.8 million savings in the 2009-10 budget.

District officials are finalizing the 2009-10 budget, but may have to make last minute changes before the school board approves it later this month. Gov. Tim Pawlenty is using special gubernatorial power – called unallotment – to reduce spending and balance the state’s upcoming budget. The governor has said he planned to avoid making school budget cuts in his efforts to balance the state’s budget. He is likely to use funding “shifts,” which delay some state payments to schools by a year.

The governor’s actions, however, could mean a loss to the District, said Rod Zivkovich, executive director of finance and support services. He added that when state funding doesn’t come on time, many districts borrow money to meet day-to-day cash flow needs and pay interest on that borrowed money. Schools also lose the investment earning on the state funding as a result of the payment delay.

“It may cause cash flow problems for us. The reality is it may result in additional cuts. How much, we just don’t know right now,” said Zivkovich. As a result, Zivkovich’s office will develop the 2009-10 budget based on a two percent decrease in state funding.

The complete list of budget recommendations can be found on the Budgeting for Success web site at www.bloomingtonschools.info/BudgetingForSuccess.