Grapevine-Colleyville trustees mull gloomy financial forecast

GRAPEVINE -- The Grapevine-Colleyville school district's financial situation is gloomy, according to administrators, and the timing of a possible tax ratification election could be crucial to postponing disaster.

Even if voters give the district permission to raise the property tax rate, the long-term budget projections presented during a workshop before the Monday school board meeting show that staff and program cuts are possible in the coming years.

During the open meeting, the board voted to change its policies involving termination of employees and layoffs, which could set the scene for staff reductions.

"With the dire financial news from Austin, we should be planning for financial shortfalls in the future," Superintendent Robin Ryan said before the vote.

In the workshop, administrators provided budget numbers for the 2010-11 school year and outlined possible situations, such as if voters reject or approve a tax increase.

If a tax increase is passed during the 2011-12 school year, a $2 million cut in staff could still happen in the 2012-13 school year, administrators said. Some $1 million in staff cuts could happen in 2013-14.

If the district does hold a tax election in 2012, combined with the reductions in staff and other expenditures, the district will be able to manage its financial situation until the 2014-15 school year, according to Elaine Cogburn, chief financial officer.

There are two state legislative sessions between now and then that could potentially provide some relief, and the district will have made significant budget reductions and used up more of its reserve fund during that period, solidifying its case for a tax increase, according to administrators.

The 2010-11 budget is $143.8 million with a budget deficit of more than $3.3 million.

"The good news is, we have a very healthy fund balance, without having to cut programs immediately," Ryan said.

An audit of the district's 2009-10 budget actually added $2 million to the reserve fund, which stands at $32.6 million, or more than $11 million above the recommended 20 percent level.

Trustees debated when a tax election would do the most good, and when one would be most likely to pass.

Some trustees said they thought a 2012 election would be more successful and give the district time to make substantial budget cuts and use up some of the fund balance.

"When you're asking taxpayers to vote for a $35 tax increase on themselves, without making cuts or using the fund balance, it's a stretch," Ryan said.

Others said they thought that waiting just puts the district in a more precarious position financially.

"I think it's going to be much harder to pass in 2012 than in 2011," said board President Charlie Warner.

The district's 80-member Stakeholders' Economic Action Team is scheduled to make recommendations to the board in late January or early February.

Among the committee's stated major initiatives are seeking new sources of revenue and reducing central office positions.

Board members also heard updated plans for a potential $124.5 million bond election for May 2011. The money would be used for maintenance and