Is the Wake County school board taking a budget gamble by hopefully only temporarily using up the fund balance to keep a pay raise for teachers?
David Neter, Wake's chief business officer, said that they're expecting to receive enough additional state money to offset getting $4.9 million less than requested from county commissioners. For fiscal purposes, Neter recommended today temporarily pulling a proposed $5.2 million pay raise for teachers and then retroactively restoring it once the state budget with the additional dollars is adopted.
But during the work session, the staff recommendation was rejected 5-4. Board members said it would send the wrong message, even temporarily, to drop the pay raise.
The four Republican board members and Democrat Jim Martin voted no to the recommendation. The other four Democrats voted yes.
Since Wake needs to balance the budget today to make up for the missing $4.9 million from the county, the board voted 5-4 to direct staff to use up all of the remaining rainy-day fund. if the state numbers are as good as expected when the budget is adopted, they'd replenish the fund balance then.
Wake is already using up most of the fund balance, around $29 million, to balance the budget. The rainy day fund is so short that staff said they'd have to juggle the books to come up with the $5 million to offset keeping the teacher raises in for now.
The work session vote saw Debra Goldman, Kevin Hill, Chris Malone, Keith Sutton and John Tedesco voting yes. Martin and Deborah Prickett were maybes.
Even though Hill voted yes, he said they were "playing texas poker" with the state budget.
Board member Christine Kushner said it would be "fiscally irresponsible" to use up the fund balance.
Neter said they're running a risk to the fund balance should they not get as much as they're hoping from the state.
The official vote will come during tonight's regular meeting.
It's all going to come down to the state budget.
At issue is Wake's share of a statewide discretionary cut that would cost the district $8.4 million. Wake built the cut into the budget but both the state House and Senate budgets call for that cut to be eliminated.
Neter said it's likely but not official yet that the discretionary cut will be gone when the state budget is finalized. Superintendent Tony Tata said it also looks likely.
After the motion to use up the fund balance failed at the regular board meeting, the board went back and approved the staff recommendation to temporarily remove the teacher pay raise. Board members reiterated they plan to restore the raise if, as it appears, they get more state funding than expected.