By Brian R. Hook
January 21, 2010

(KansasReporter) TOPEKA, Kan. – In the fight over school funding, both sides agree that school districts in Kansas are sitting on at least $1.4 billion in cash reserves.

The battle over whether that money is available to spend played out during two competing presentations Thursday morning in front of the House Appropriations Committee.

Dave Trabert, president of the Kansas Policy Institute, the parent organization of KansasReporter, first told lawmakers that school districts had $1.498 billion in unencumbered cash balances, as of July 1, citing the Kansas Department of Education.

Mark Tallman, assistant executive director of the Kansas Association of School Boards, reported that his association’s members had total cash reserves of $1.458 billion, as of July 1. But the $40 million difference between the two totals was not the main contention.

Tallman said $998.8 million of his total was in restricted funds, leaving only $459.2 million available, which equals 8.2 percent of budgeted expenditures. He said that it is good fiscal management for school districts to keep reserves for unexpected expenses.

Those unexpected expenses include providing cash for expenditures that occur before state aid kicks in, allowing a cushion if state aid or other income is delayed or reduced, and providing needed funds for unexpected things like roof repairs and bus replacements.

Trabert pointed out that the unencumbered cash balances grew 40 percent from $1.068 billion in 2005 to $1.498 billion in 2009. “This only happens when revenues exceed expenses,” he said, adding that schools may not need all of the money. Plus, there has never been an independent audit to determine the necessary ending balance in each fund, he said.

The schools could work on becoming more efficient, Trabert said, therefore avoiding the need to raise taxes. He cited an audit of the Derby school district that found $1 million in savings.

Trabert said there is a tendency to compare a budget to last year’s budget. Instead, lawmakers should look at what is spent and he advocated for looking at expenditures monthly.

In response,Tallman reminded lawmakers they set the spending amounts. How the money is spent may vary. “Districts make choices of where to put resources,” Tallman said. “Under our system, we encourage districts to have different priorities for their different communities.”