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Jackson County schools brace for budget cuts By DAMIAN MANN Still reeling from recent staff reductions and budget cutbacks, Jackson County schools could lose an additional $4 million in revenues because of a worsening Oregon economy. With combined budgets of about $220 million, Jackson County education systems have been given notice that they should expect a 2 percent reduction in already budgeted revenues. Nancy Heiligman, director of school finance for the Oregon Department of Education, said Gov. John Kitzhaber told all state agencies to prepare for cuts amounting to some $240 million statewide because of a downturn in the economy. In a worst-case scenario, government analysts are also warning that the cuts could go as deep as $600 million, said Heiligman. For kindergarten through 12th-grade education, which was expecting $5 billion in the recently approved biennial budget, this would mean about $100 million less in revenues. In an economic downturn, Heiligman said, homeowners are often slower to pay their property tax bills - a major component of education revenues - creating a potential cash flow problem for schools. Heiligman advises schools preparing for the financial crunch: "Don't panic, be prudent and be conservative where you can." Some districts are worried that they might have to make mid-year budget corrections, which would be particularly disruptive. But Heiligman doubts that the state would impose such a harsh measure, instead deferring the cuts to the following year. So far, the governor is hoping to keep the brunt of the cuts away from primary and secondary education, Heiligman said. The governor and Legislature plan to tackle the predicted budget losses during a special session that likely will be held in January. The Ashland School District, which suffered an $840,000 shortfall and the loss of 14 positions this year, is bracing for another $400,000 in cuts if the state's revenue projections hold true. Superintendent Juli Di Chiro said the district will be preparing contingency plans that could involve further reductions in staff. She is hoping the state doesn't force schools to accept the reductions during the middle of the school year, creating a logistics nightmare as schedules and classrooms would have to be changed. If the state decides the cuts must be made in the middle of the year, Di Chiro said it might be possible to dip into a special $900,000 contingency fund that is normally used as a self-insurance plan against catastrophic claims filed against the district. But this would be a risky move, said Di Chiro, potentially exposing Ashland schools to large claims such as workmen's compensation. "We would be taking a chance," she said. The district already has embarked on a fact-finding mission to find ways to reduce expenses in order to resolve long-term budget problems. Many educators are worried about the future of Oregon's budget and the long-term impact on education funding. "It is hard to predict what the whole terrorist situation will have on the economy," she said. Galen Anderson, business director for the Medford School District, said that even a 2 percent reduction in revenues would have a severe financial impact. With most of the district's $80 million budget composed of state money, Anderson estimated a 2 percent cut of about $1.5 million. Medford schools recently cut more than 30 positions because of a $1.8 million shortfall. "We have already gone through a lot of reductions to balance the budget," said Anderson. If more cuts are needed, the district, which spends more than 80 percent of its budget on salaries, would have to reduce staff, he said. The Eagle Point School District suffered the most from this year's cutbacks, losing 71 positions to make up a $1 million shortfall. Finance director Greg Lecuyer said his budget of $26 million could be cut by another $480,000. "It's low enough already," he said. "But we'll deal with it." 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.