CUMMING, Ga. — A silver lining in the COVID-19 disruption is an increase in local tax revenues flowing into the Forsyth County School System as it deals with an increasing number of students and an ambitious construction program.
“We're going to end up this current year better off than we thought,” said Larry Hammel, chief financial officer for the district. “And we're planning for even a bigger increase in local revenue come next year.”
The fiscal year 2022 budget which began July 1 is right at $520.1 million, up 5 percent from last year. Revenues are also up nearly 8 percent from FY21.
Local tax revenue makes up about 52 percent of the budget. For FY22 local revenues rose more than $20 million from last year.
During a budget presentation to the Forsyth County School Board in June, Hammel said the pandemic may have helped boost the budget.
“People stayed at home most of the year, buying stuff within their zip code,” he said. “They weren't going to stores outside of Forsyth so that helped us a lot.”
Hammel said the rounds of stimulus checks also helped increase local spending, with part of the taxes paid going directly to the school systems.
For FY22, Hammel sees continued growth this fiscal year as the economy begins to fully re-open.
State revenue provides the remainder of the Forsyth County Schools’ budget. This year the district expects to receive nearly $244 million in state funding, a $17 million increase from the previous year.
State funding is based on enrollment, and Forsyth County is one of only a handful of school systems across the state — and the only Metro Atlanta district — to see enrollment increases.
Hammel said Forsyth County Schools will surpass Atlanta City Schools, and possibly Clayton County this year, to be the state’s fifth largest system. Next month, approximately 51,500 students are expected to enroll when the school year opens.
Despite the revenue increases, district expenditures also increased with four new schools opening in August. Aside from construction costs, operating the buildings is a significant part of the budget.
The budget for maintenance and operations increased by nearly 14 percent for FY22.
But the main driver of the budget is tied to people, noted Hammel. Currently 90 percent of the district’s budget is tied to salaries and benefits.
For that reason, salary increases for FY22 will include only a 1 percent cost of living increase, and a “step” increase for eligible employees tied to the number of years worked.
Hammel said teachers and staff also received a $2,000 bonus in May from federal stimulus funds tied to COVID relief. The state provided a $1,000 bonus, with Forsyth County Schools matching it.
The district is also projected to end the fiscal year in June with a reserve fund at its target of 15 percent of expenditures. Maintaining that number is key to keeping the district’s high financial rating.
Last year the school system pulled money from its reserves to balance the budget. The FY22 budget is also balanced with an $11.3 million drawdown of the reserve funds.
However, the planned infusions into the fund over the next 12 months will rebuild the reserves to 14.99 percent, noted Hammel, just under the goal of 15 percent.
The millage rate of 19.718, which covers maintenance, operations and bond payments, will remain the same in FY22.