The Little Rock School Board on Thursday heard the the district's total local tax revenue collections are down in some categories and overall $6,433,763 less than projected.
Little Rock School District Chief Financial Officer Kelsey Bailey led a presentation during the board's monthly business meeting, which covered revenue, expenditure and fund balance updates as of May. Bailey said he believes the anticipated teacher raises are still possible for the district.
Bailey said the district's local revenue came in $4,308,706 less than the projected amount for July to December 2021, and 2022 revenue is down by $1,942,149 compared with May 2021. The excess treasurer commission and interest collections also came in less than projections by $602,503, Bailey said, and the revenue in lieu of taxes came in $252,766 less than projections.
However, Bailey said the delinquent property taxes and land redemption collections are up by $253,786 compared to May 2021. Also, the 98% Uniform Rate of Tax has increased by $418,575, he said.
Bailey said he expects the district to receive additional tax revenue, but he is waiting to see when the tax collection is going to fall for the upcoming year. The pandemic has shifted usual timelines, he said.
"Last year, we had one fall at the end of the fiscal year and got in 9 million dollars that wasn't projected," Bailey said. "The projections are conservative."
During the expenditure update, Bailey said employee salaries and benefits are still slightly over budget, but most of the district's general operating budget accounts still appear to be on track to finish on or under budget. He said the district is finalizing payroll now, and he will provide another update during the next board meeting.
Bailey said the district's fund balance has slightly reduced in this reporting period. The current balance is about $48.3 million as of the end of May and will go down based on payroll. However, Bailey said the capital improvements, federal and child nutrition fund balances are very healthy, and the district can focus on its goal of salary raises for teachers.
Michael Mason asked Bailey whether he knew the amount needed to hire EAST Initiative facilitators to come from the operating budget. Bailey responded that these are likely the only teacher positions being added, and the district is currently reducing its number of teachers.
"We have to get to a point where the district is the right size for the number of students we have," Bailey said. "That includes facilities and staff."
Superintendent Mike Poore said the board should consider not only this year, but also the years following. The percent increase for teachers is the "gift that keeps on giving," he said, and while teachers did not get the large pay increase the district is working toward this year, they did receive a step increase.
Bailey agreed and said it was a historic decision for the district to increase the teacher base pay by $7,000 and adjust the pay scale accordingly. In October, the district approved the first part of a three-year pay raise plan for teachers which would ultimately increase the starting salary to $48,000 by 2023. Bailey told the board on Thursday that the raises look promising, but "it's going to be real tight." He said he doesn't want to get to the point where the district is outspending its fund balance.
Bailey said the district's current priorities are completing the staff reductions and making data-driven decisions. He said the district has enough time to see what enrollment is each year and then make adjustments.
"Closing schools is never going to be easy, but we have to come to the realization that we've lost students," Bailey said. "We were once a district of 26,000 at one time, we're 22,000 right now. That's 4,000 students. We have a lot of buildings."