Sullivan County school budget woes: What you need to know

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SULLIVAN COUNTY, Tenn. (WJHL) – Will Sullivan County Schools remain open for the rest of the month?

That question could be answered tonight at the Sullivan County Commission’s called meeting following news that county schools could cease operations this month.

It’s been almost a week since Director of Schools Richard Cox notified employees that the department’s $36 million budget failed the state’s maintenance of effort test, which prohibits local governments from submitting a budget that reduces local educational funds.

RELATED: Director: Sullivan Co. schools may have to suspend operations, cancel school over budget issue

According to the University of Tennessee, the test is also used to ensure “local governments do not use state dollars in place of local dollars.”

What the Board of Education says

A fact sheet posted on the Sullivan County Schools’ website says that the board has historically allocated a 2% loss in the city/county split of local revenues when preparing the annual budget.

The fact sheet states that city/county split means that local revenue between all school systems within Sullivan County (Kingsport City Schools, Bristol City Schools, Johnson City Schools and Sullivan County Schools) must be shared proportionately based on a combination of each system’s weighted average daily attendance.

According to the fact sheet, the school system has “historically” projected a 2% loss in the city/county split. The reason, according to the fact sheet, is that the county’s share of the split will decrease if its attendance rates decrease while other systems in the split increase or remain the same.

The school system said in its fact sheet that the commission reduced the operating budget by $800,000 before submitting it to the state, which was enough to make it fail the state’s maintenance of effort test.

What the commission says

A letter dated Sept. 27 from Mayor Richard Venable to commissioners says that the Sullivan County Board of Education based their estimated funding on the anticipation of a 2% decrease in average daily attendance.

In his letter, Venable writes that Chairman Michael Hughes said the ADA has historically dropped between 0.5% and 2.9%.

READ MORE: Sullivan County mayor accuses BOE of ‘playing political games’ over school funding

He says in the letter that the last year the ADA dropped by 2.9% was in 1991, and that the largest drop in the past 10 years was by 1.35% in 2012.

News Channel requested ADA reports from the Tennessee Department of Education Wednesday afternoon.

Venable also writes “the General Purpose School Fund has a $17,431,099 unreserved cahse balance as of the end of June 2019.”

He continues, “The School Board is required to keep 3% of their annual operating budget in an unreserved fund balance which would be an approximate of $2.5 million based on the (fiscal year) 2020 budget.”

In its fact sheet, the Sullivan County Department of Education says that the current available fund balance is approximately $10 million.

When asked for a copy of the budget, a representative of the department said, “We do not have officially audited financial statements to release as the June 30, 2019 audit has not been completed.”

The commission will meet at 6 p.m. to discuss the issue.

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