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By Bryan Marshall

Officials at Grant and Williamstown Independent Schools will be facing mid-year budget cuts because of a more than $49 million state revenue shortfall.

The Support Education Excellence in Kentucky (SEEK) fund, which is the primary source of monies provided to the state’s 174 public school districts, has less money than needed for the per-pupil funding authorized in the enacted budget for the current fiscal year.

The shortfall will require reductions in funding allocations for all school districts.

Total SEEK funding for Fiscal Year 2011 is about $2.5 billion, which is approximately $49.3 million or 2 percent less than what is actually needed.

Matt Morgan, assistant superintendent for finance and personnel, said Grant County Schools will be cut about $398,000.

“We made some conservative revenue estimates for this year that will help absorb part of the cut,” he said. “But, we’re going to take a look at taking some out of contingency, I’m afraid. It’s just not a good thing to look at.”

Grant County Schools has about $2.3 million in its contingency fund.
Williamstown Independent Schools is facing a decrease of $88,000 in SEEK funds.

“It looks like $75,000 will be out of the general fund,” Superintendent Sally Skinner said during the Jan. 10 school board meeting. “The other is out of building fund money.”

According to the Kentucky Department of Education, a major reason for the shortfall is that many school districts have shown unanticipated student growth over the past fiscal year.

Grant County Schools’ attendance has only decreased by one student from last school year while Williamstown Independent has the same number of students currently, 902, as they did at the end of last school year.

Average daily attendance figures for the end of FY 10 showed about 10,000 students more than anticipated. This is due to the enrollment of approximately 3,000 new students statewide, improved student attendance and a change in the way attendance is calculated.

The (SEEK) funding formula was implemented in 1990, in response to the mandates of the Kentucky Education Reform Act (KERA). The Kentucky legislature allocates funding for the formula, and school districts receive funding based on their average daily attendance figures. The formula also takes into account a number of variables, such as local financial support, transportation costs and more.

Prior-year ADA figures are used to determine each school district’s per-pupil funding amount through the SEEK formula.

“This is not unusual and has happened twice before, with the last time in FY 2006,” said Kentucky Education Commissioner Terry Holliday, in a press release. “The good news is that Kentucky received $134.9 million in federal EduJobs dollars to cover shortfalls such as these, and this funding has already been distributed to the school districts. With these additional funds, the per-pupil funding amounts for each district will be met.”

Reductions to districts’ SEEK allocations will occur beginning in April.

With mid-year cuts, local officials aren’t optimistic about the financial forecast for next year.

“It doesn’t look good for next year, depending on what happens,” Skinner said. “But, we’re good and sound financially. We have been planning for rainy days, and now I think they’re coming. We’re very fortunate than some of the other districts.”

If revenues could not be made this year, Morgan said he does not see it being met next year either.

“It’s very frustrating,” he said. “We made plans on having our finances in order and our plans laid out, and then they tell us this at the worst possible time. Right now, we’re dealing with our draft budget for next year. The cut not only affects this year’s budget, but also next year’s budget because we have to go back and plan for what we’re going to get hit with in 2012.”