In an April 20 presentation to the board of trustees, Chief Financial Officer David Pate said the district expects to have $373.7 million of revenue in school year 2021-21, which is down 1.5% year over year.
The board of trustees heard several presentations throughout the past few months on topics ranging from pre-K expansion to literacy needs. Recommendations that came out of those discussions require the district to spend an additional $16.6 million, an amount that surpasses the $11.2 million it will have left over once it pays staff and covers all other recurring expenditures.
“What you need to know here is there is still work to do,” Superintendent Jeannie Stone said.
The dip in revenue does not come as a total surprise to the district, Pate said. A compressed property tax rate brought on by House Bill 3 compounded by a slowdown in the estimated growth rate in taxable property value has hamstrung revenue at school districts statewide. RISD also predicts minimal enrollment growth headed into next year, which would drive down the amount of per-pupil funding it gets from the state.
The coronavirus may also impact the district’s bottom line, Pate said. Rising rates of unemployment could cause a delay in property tax collection, Pate said.
Also, RISD may not receive updated values of properties until later this year, which would hamper its ability to set its tax rate. About 95% of property value is usually determined by July; however, due to a delay in protest hearings, that number will likely be closer to 90%, Pate said.
“That just adds an additional layer of variability to the revenue picture,” Pate said.
The district is expected to have $2 million in fund balance that can be used for specific projects, such as construction and bond planning, Pate said. Additionally, the district expects to have $111.6 million in unassigned fund balance, which can be used to cover cash flow inconsistencies, Pate said.
The board will hear initial budget proposals at its May 4 and May 18 meetings. A public hearing and possible adoption are scheduled for June 8. However, if the budget is not ready to be adopted on that date, the board can postpone the vote until June 15, Stone said.
The tax rate will be voted on at the board’s Sept. 14 meeting. Tax bills are scheduled to be mailed to residents Oct. 1.
