Walter H. Warfield is scholar-in-residence at the University of Illinois at Springfield after serving as a school superintendent and executive director of the Illinois Association of School Administrators.
Sir Claus Moser once said: "Education costs money, but then so does ignorance."
Placed firmly at the top of the annual rites of summer school board duties is the development of the school district's coming year budget. This task may not be on a school board's Top Ten List, but as a duty, it falls on its most important list.
Important because, when executed properly, the process of budget development becomes a powerful tool for sound fiscal management and transparent integration of school district needs and resources. It's also important because the more people understand about the complex and clearly confusing world of public school district finances, the greater the potential for general support for the school board's difficult and important financial decisions.
In a typical community, only 25 percent of the households have children attending public schools. Yet all households pay varying amounts of local, state and federal taxes to support schools. That sets up conflicting interests in the quality of local public school district programs and the efficiency in managing those funds.
The degree to which citizens desire and are able to understand information about school finances varies widely. Thus the challenge to the board is to use a process that provides the information where, when and how citizens can best obtain it, in a format that can be understood, and all within what is required by law.
In the current economic crisis, it is even more important than ever for school board members to show they have a plan for the expeditious use of school funds to the maximum benefit of the educational programs and services delivered to the students. This starts with a financial plan.
Forming a plan
A district financial plan typically extends out three to five years. Consider the plan as a compass for maintaining the true north of sound fiscal management. Clearly, the further out the plan goes, the hazier the picture it paints. But just as an ocean liner maintains its course relying on true north and adjusting its immediate path to avoid nearing obstacles, a district financial plan relies on the true north of balancing income to expenditures and adjusts the annual budget to compensate for the obstacles of the coming year.
The plan's accuracy is enhanced when expenses are forecasted from other planning documents: student enrollment projections, faculty and staff demographic charts, facility maintenance and replacement plans, transportation fleet reports, employee union contracts, and community plans and projections.
Revenue forecasts, while seemingly unpredictable and even mysterious, can be made from an analysis of past revenues tailored by actual data and projections received from the appropriate local, state and federal agencies.
Within the context of the school district multiple-year financial plan, the annual budget then becomes the vehicle whereby the year at hand is executed in a clear, logical and precise manner. Logic prevails and surprises are minimized.
In this way, citizens and employees alike will be less concerned with their understanding of the myriad of federal, state and local funding sources because the message has been sent that the school board members and the administrators they employ are on top of the financial situation of the schools.
How school board members handle the budget process is clearly as important as the budget itself. Through this process a school board can demonstrate to the public the degree to which they are on top of the multi-million dollar operation that they were elected to oversee. The message of maximum educational benefit to the students coupled with financial efficiency is a powerful message to send.
It is what it is
Recognize the budget for what it is: a short-range, one-year plan, consisting of expected revenues against expected expenditures. Standing alone, the budget is no more than a snapshot of how the school district's revenues and expenditures for the year will be handled. Yet when placed in the context of the multiple-year financial plan, it becomes the vehicle whereby the finances of the school district are managed with a clear specificity of scope and direction.
These tasks are best completed when the school board works in concert with the superintendent. As decision makers and policy setters, board members should not need to gather fiscal and program details. That responsibility falls to the superintendent, who is equipped with the time and expertise to gather all of the information mentioned, as well as the skills to work with the board to interpret it. Within the process, data is gathered and analyzed. Questions are asked and answered. As priorities are shared and requirements identified, understandings are achieved.
From this team effort, the board will be in the best position to make the necessary policy and financial decisions on how to use the district's financial, human and program resources to the maximum educational benefit of the students, coupled with maximum efficiency, accountability and transparency to the citizenry.
Lastly, working on the budget will be easier if you keep these points in mind: