Despite ‘unknowns’ of pandemic, new VHCS budget ‘encouraging,’ CFO says

The budget for the 2020-21 school year for Vestavia Hills City Schools looks similar to previous years when it comes to expected revenues and expenditures, but the COVID-19 pandemic has created some questions.

“We have so many unknown costs due to COVID-19,” said Courtney Brown, the school’s chief financial officer.

Those unknown costs include personal protective equipment, cleaning supplies and the hiring of extra nurses. One extra nurse has already been hired, Brown said.

To deal with those unexpected costs, the system budgeted for a roughly $1 million increase in instructional support expenses.

Brown said additional expenses were built in, and there will likely be an increase in costs related to the pandemic as the school year goes on.

“I feel like this whole year has been full of uncertainties,” she said.

Despite all of the unknowns associated with the pandemic, Brown said this year’s budget is encouraging. An $8.3 million surplus gives the system plenty of room to be flexible, and there is help available from the state to deal with COVID-19 related expenses.

One of this year’s new expenses is paid for by state funds. The school chose to move to a one-to-one system with Google Chromebooks, ensuring each child in the system will receive one. That cost will come out of the Education Trust Fund’s Advancement in Technology Fund provided by the state. The fund for Vestavia is about $1.7 million, and in addition to paying for Chromebooks, it will help fund school resource officers and help supply the school’s general fund budget, Brown said. Last fiscal year, the school used those funds to offset maintenance costs and facility upgrades, Brown said.

The school won’t be paying for major capital projects this year, a shift from previous years, after projects at Vestavia Hills Elementary Dolly Ridge and Pizitz Middle School. Brown said the school anticipates $8 million in bond funds from the state this year, which will be used for various facility upgrades.

One of this year’s focal points will be trying to get closer to $13 million in the general fund balance, which is two months’ worth of reserves, Brown said. The new budget anticipates the fund balance at the end of the 2020-21 school year to be about $11.5 million, she said.

Total revenues from this year’s budget come in at $81.9 million, with $80.7 million in expenditures, Brown said. Personnel makes up the largest percentage of the budget, as it always does, with 81% of the budget set aside for personnel costs, equaling about $64.8 million. The next highest expenditures are utility costs, debt services and safety and security costs, Brown said.

Fifty-four percent of budget revenues come from local ad valorem taxes, Brown said, and with a slight increase in assessed property values this year, the system budgeted for a 2% increase in those revenues.

The system also lost seven teacher units due to the reconfiguration of the system’s elementary schools, which all became K-5 schools, with Vestavia Hills Elementary Central going offline following the 2018-19 school year. Other than that, Brown said there was no major change in personnel.