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School district's wallet about empty High transfer rate contributes to the problem By Damian Mann With cash reserves almost tapped, the Phoenix-Talent School District forecasts a budget shortfall next year unless it gets more money from the state and an increase in enrollment. Cash reserves were $1.1 million this fiscal year but are expected to dwindle to $300,000 next year, said business manager Doug Spani. Spani said most of the $1.1 million was used in the $18.46 million budget for 2000-2001, creating a potential shortfall for 2001-2002 even if expenses remain flat. District auditors recommend cash reserves of 5 to 10 percent, or about $900,000 to $1.8 million. "You can only bleed the bank account so far," said Superintendent Dave Willard. "We knew this day was coming." The razor-thin carryover fund is forcing the district to make plans for possible cutbacks in light of increased costs, flat enrollment projections and a high student transfer rate. District officials also await the state�s decision on its budget, which provides about 70 percent of local school revenues. "Things are looking tough," Spani said. But he added that historically, things often turn around, particularly if enrollment increases or the state Legislature improves education funding. Spani said that not enough details have been revealed so far in Gov. John Kitzhaber�s proposed $5.2 billion education package to make accurate predictions on a potential shortfall in the district. The state budget likely won�t be approved by the Legislature until this summer. In the next few months, the district will look at ways to cut expenses in hopes it can carry over more money to augment next year�s budget, school officials said. Spani believes it is too early to predict the severity of the problem. "I have five to 10 scenarios with all sorts of ranges. It is just too early to tell," he said. One scenario, though, is the possibility of staff or supply reductions. "Obviously, salaries make up the biggest part of the budget," he said. The district faces a relatively flat enrollment that hovers around 2,700 students, with each student bringing the district almost $5,000 in income. Exacerbating enrollment problems is a high student transfer rate to other districts. A majority of these 234 transfers are to Ashland and Medford. The district receives about 117 students who transfer in, leaving a net loss of 117 students, or about a $500,000 loss. School officials had suggested banning student transfers to help improve revenues, but at a recent public hearing, most of the 100 residents who attended said they should be allowed to send their children outside the district. The school board, which meets Thursday, plans to receive more public comments on this subject. Willard concedes it would be difficult to force these parents to leave their students in Phoenix-Talent schools. "My agenda is that I want them to be here," said Willard. But he said the district may have to begin offering other programs to entice them back, including more specialists in certain subjects, more electives at the high school, more after-school programs and more remedial help for students. "A lot of this will be dictated by the budget," he said. Although an ultimate decision would have to be made by the board, Willard said he is leaning toward allowing students who have transferred out to remain out, unless he can persuade them back in. "If we change things, they will be in the future," he said. "We don�t want to change the rules (for parents) in the middle of the game." Reach reporter Damian Mann at 776-4476, or e-mail [email protected] Mail Tribune Home | Ottaway Newspapers, Inc. | Dow Jones & Co., Inc. | Privacy | Contact Us Copyright � 2001 Mail Tribune, Inc.