Week 4 Assignment, Part 4

The total budget for this school year in my district is $77,623,281. This amount is about six percent less than it was last year, a result of the state reducing our funding. Our budget is like all other school districts, the greater majority of the budgeted funds are spent on personnel salaries. This year 74%, $57,441,228, of budgeted funds are spent on personnel salaries. As far as my insight on the percentage of the district budget spent on personnel salaries, we budget less for personnel salaries than most districts. This is a decision made to provide and enhance our educational services throughout the district. I do not know what the impact would be if we spent at least 80% of budgeted funds on personnel salaries. I would imagine that the number of personnel could increase and that the pay scale would be adjusted with a bump up in salary for each position.

A five percent increase in personnel salaries would have both positive and negative impacts. The only real positive impact that I can imagine would be in personnel morale. A five percent increase would more than likely cover medical premiums and still leave them with more money in each paycheck. The negative impacts would be that the money would have to come from somewhere. Would the additional $2,872,062 come from additional taxes, the fund balance, or from cutting all other expenditures? I do not think that it would be wise to apply the adjustment to only one of the above listed fund sources. It would be better to generate the $2,872,062 from multiple sources so to alleviate the impact felt in these other areas. There are only two ways to make the suggested pay raise happen, bring in more money or spend less in areas other than personnel.

A five percent is a significant increase for personnel. Pay raises that I have heard of are much less, 1%-2%. These smaller increases are practical for school districts and easier to fund. From the employee’s perspective the 1%-2% increase barely covers the increase in insurance premiums. A five percent increase in personnel salary would be welcomed by personnel but would definitely place stress on the school district. Depending on the need of the district, the budgeted increase in personnel could be spent on additional personnel rather than increasing current staff salaries. Just a thought.