Board of Education passes fiscal 2023 budget

The fiscal 2023 budget will bring some raises for Vestavia Hills City Schools teachers and increases in both revenues and expenditures.

Courtney Brown, the chief school finance officer for the district, said expenditures are up about $5 million from fiscal 2022’s budget and revenues are up about $4.2 million. This year’s budget, approved Sept. 12 by the Board of Education, is a “tight” one, she said.

The budget includes a 4% mandated state raise for teachers.

The school system receives local, state and federal funds, in addition to a few other revenue sources, according to Brown’s presentation to the board. Those local funds pay for 110 teachers, eight counselors and eight nurses, Brown said. The rest are state-funded. Local revenues, gathered mostly from ad valorem tax and some sales tax, make up 53% of the district’s revenues.

The top three areas in budgeted expenditures are: instructional services, 56%; instructional support, 19%; and operation and maintenance at 10%.

The state increased their funding for nurses by about $85,000, and their funding for transportation operations by about $38,000.

Here’s a breakdown of the increases in expenditures compared to fiscal 2022:

► Instructional services increased about $2.4 million to $55.1 million to fund the salary increase and benefits, along with step increases.

► Instructional support increased about $1.3 million to $15.2 million, due to teacher raises and benefits.

► Operations and maintenance increased about $400,000 to $10.3 million, due to the increase in utilities, security services and janitorial supplies.

► General administrative services increased about $250,000 due to the increase in insurance and professional fees.

Inflation has impacted the district, as it has everyone else. Brown said there are increases in janitorial expenses, fuel, food and utilities. The school district’s liability insurance has also increased by 28% due to the economic impact on insurance carriers.

The impact of inflation has also been felt at the end of fiscal 2022.

“It definitely resulted in a lower budget surplus,” Brown said.

While the district budgeted $1.5 million in a surplus, the projected surplus is about $844,000, Brown said. There are some concerns that if the state passes another teacher pay raise, which Brown said is unlikely, it could impact how much the district has in reserves.

In order to ensure the district has enough funds, the ad valorem revenue projections are “conservative,” Brown said, and while the district may not have two months of reserves as they would like, they should end fiscal 2023 with 1.2 months of reserves, a little more than the one-month requirement by the state.

Following years of capital projects, there are no major capital projects for the fiscal 2023 budget, Brown said. The newest projects are listed as part of the 1Rebel 1Future proposal put forth by Superintendent Todd Freeman, but before those projects start, residents will have to vote on and approve a tax increase. The amount the school system will ask for is not yet known. For more information on that proposal, read this month’s cover story.

Brown said even with inflation, the school system remains in good shape.

“We have a very strong property tax base,” Brown said. “We’ll manage with the funds we receive.”