Q: How much of the school systemís budget is from the state and how much is from the county?
A: Understanding how schools are funded can be very complicated. Every school system in North Carolina receives funding from three major sources: federal funds, state funds, and local funds. In the Rowan-Salisbury School System:
20 percent of our total budget comes from federal sources
59 percent comes from state funds
19 percent comes from local county funds
2 percent percent comes from other sources
Other sources would be such items as interest, fines and forfeitures, donations and grants from local foundations and businesses, rental of school property, etc. State and federal funds are received based on formulas, mainly based on average daily student membership (ADM), and are allotted in specific categories such as teachers, teacher assistants, central office, textbooks, instructional supplies, etc. There is minimal flexibility in moving funds from one category to another.
Our local Board of County Commissioners is the only funding source that allows us to submit a request based on system needs.
The Rowan-Salisbury School System must submit a budget request to the Board of County Commissioners each year by April 1. The budget discussion begins much earlier than April. Work on developing the local request begins in February and early March. Information about the budget and the system needs is shared with staff, the school boardís Finance Committee, as well as the entire school board. Each year the School Board approves a final local budget request at their March school board meeting. The request to the county is dependent on the state and federal budget predictions. In years such as this, when there is little knowledge as to what the state budget cuts will be to school systems, it makes it even more difficult to prepare an appropriate budget request.
School systems encounter certain mandatory increases. This year the state department has indicated an increase in retirement and insurance costs for all employees. Since many of our employees are paid from local funds, the increase for these locally paid employees will need to be covered by local funds. For 2011-2012, our local costs will be an additional $181,000 for retirement and $106,000 for insurance. If our school system receives the same amount of local funding as last year, $287,000 will have to come from the fund balance or additional cuts will need to be made to cover the extra mandatory costs.
For the third year in a row, state revenues to fund education are expected to decline. State funding has been cut by $12 million over the past two years for K-12 education in our school system. Current discussion among legislators indicates additional reductions for K-12 education of 10 percent to 15 percent in order to balance the 2011-2012 budget. This re$10 million to $15 million reduction for our school system.
School system staff has worked diligently over the last few years trying to save as much as possible knowing that the 2011-2012 and the 2012-2013 school years would be the most difficult budget years in the history of public schools. Instead of criticizing the school system for trying to save funds for these anticipated deficits, the county should be applauding the school system for trying to save peopleís jobs and keep the unemployment rate from increasing and affecting the county economically. If the county cuts the school systemís budget and/or uses the school systemís fund balance, the school system will be left with few funds to offset the state budget cuts.
The current best-case scenario is that the school system will have to use a combination of fund balance, federal jobs funding and cuts to survive the 2011-2012 budgets. The 2012-2013 budget year will be even more devastating with the expiration of the federal jobs funds.
The county commissioners are faced with many needs and many requests in a slow economy. We also know that the children in Rowan County deserve the best education possible and that they are our future taxpayers and the future of our economy. We need to all work together to find the best possible solutions to our economic difficult in ties.
For more information about the Rowan-Salisbury School Systemís budget and forecast, please visit our website at http://www.rss.k12.nc.us/ — Just click the icon, ě2011-2012 Budget Outlookî and this will take you to the budget webpage.

Dr. Judy Grissom is superintendent of the Rowan-Salisbury School System.