Local revenues for the Baldwin County school system came in slightly higher than the previous year, and the district was on track to finish fiscal 2014 in solid financial shape, its chief financial officer told the school board.
John Wilson, the system’s chief financial officer, presented a financial update at the board’s July 22 work session. He said the district expected to close the fiscal year with an operating reserve balance of between $33 million and $36 million.
Comfortably above the required reserve
The State Department of Education requires every district to set aside enough money to cover one month of operating expenses. In Baldwin County, that threshold works out to roughly $20 million, meaning the projected reserve stood well above the state minimum.
Meeting that requirement is not automatic for every district. Wilson noted that the Mobile County system, the largest in the state, had finished fiscal 2013 about $7.6 million short of the mark, a contrast that underscored the relative stability of Baldwin County’s finances.
Penny tax outpacing projections
The county’s one-cent sales tax for education had brought $21.4 million into the school system by the end of June, an increase of $198,000 over the same point in 2013. Wilson said his 2014 budget had planned for about $28 million from the penny tax, but that the total would likely come in closer to $31 million.
That figure would put the tax at roughly the same level it produced in fiscal 2013, suggesting the revenue source had stabilized after earlier fluctuations. The tax has been a central piece of the district’s funding, supporting day-to-day operations across a fast-growing county.
Property tax collections were also tracking close to expectations. The system had collected $41.3 million in property tax revenue, about 98 percent of the budgeted $42.2 million.
“This means we’re on track to finish basically where we’ve expected,” Wilson said.
A $305 million spending plan
The district’s overall spending plan for 2014 totaled $305 million, reflecting the scale of a system that serves one of Alabama’s most rapidly expanding counties. Keeping revenues aligned with that plan has been a recurring theme for Baldwin County officials, who have watched enrollment climb along with the county’s population.
The reserve balance carries particular weight for a growing district. A strong cushion gives the system flexibility to absorb unexpected costs, respond to enrollment surges and weather swings in sales tax collections, which can rise and fall with the local economy and the seasonal tourism that shapes much of the county’s commerce.
Wilson’s report offered the board a snapshot of a system operating within its means as the fiscal year neared its close, with both of its major local revenue streams performing at or above what officials had budgeted. The update set the stage for the district’s planning heading into the following year, when Baldwin County’s continued growth would again test the balance between rising demand and available dollars.