Duneland School officials say the financial situation facing the school
system is dire – and they are turning to the public for input.
Duneland Superintendent Dirk Baer received support from the Duneland School
Board Monday to set two special public meetings, on Jan. 11 and Jan. 16,
both to explain to local residents why school finances have taken a nose
dive and to get input on whether the public wants to see program cuts or new
The upcoming meetings were announced after school administrators gave an
end-of-the-year financial report showing quickly disappearing cash reserves,
with officials placing the blame squarely on the state.
The state took over funding for school general funds in 2008 by raising the
state’s sales tax from 6 to 7 percent. But this was in the midst of a
recession, and when state revenues soured, the state cut tuition support to
many schools, including Duneland.
The state also gives local schools the ability to seek voter approval to
raise additional revenue through property taxes, with the increased funding
immune from cuts from the state’s tax caps. When asked after the school
board meeting if the upcoming public sessions might lead to a referendum
proposal, Baer did not rule out that possibility but noted that the purpose
is to seek public input on what direction to take.
Detailing the year-end cash flows, Duneland Assistant Superintendent Dave
Pruis said state-funded tuition support has dropped in each of the past two
years – a decrease of $150 per student in 2009-10 and a drop of nearly $108
per student in 2010-11. Though the 2011-12 numbers aren’t yet known, Pruis
is projecting another decrease of $31.50 per student. With a student
enrollment of about 5,700, the loss for just next year is projected at
In addition to the state funding cuts, Duneland has lost students, with a
decline of 126 students last school year and a drop of 42.5 students this
The cash balance now on hand totals about $5 million, which includes the
December state support payment. But with payroll and other required
expenses, the cash balance actually stands at about $1.5 million.
But Pruis said even that $1.5 million is a bit misleading, since it reflects
one-time federal stimulus dollars that helped retain staff in the midst of
funding cuts. Pruis said while those federal dollars helped keep Duneland
out of the hole financially, the federal funds have now run out.
Even with other year-end encumbrances scaled back, Duneland is now facing
the possibility of a cash balance of about $227,150 at year’s end. That’s a
far cry from the ideal situation: Pruis said when school finances were
stable, the target was to have 5 percent of the school general fund, or
about $1.8 million, in reserves, with an 8 percent reserve ideal.
When the school board adopted the 2012 budgets earlier this fall, it was
known that the budget was $1.7 million short. Pruis said the cash reserves
that Duneland once enjoyed, for all practical purposes “will, before this
year’s over, be gone.”
Baer noted that Duneland has made significant cuts without major sacrifices
to school programming. Compared to just a few years ago, Duneland now has 21
fewer teachers and administrators and a general fund budget of about $4
million less. The only options left for Duneland, he said, are to further
decrease expenditures, which could involve program cuts, or to increase
School board member Ralph Ayres, the board’s legislative liaison, said that
Indiana lawmakers will be back in session by the January meetings. All
indications are that lawmakers will not reopen the state budget, he said. He
characterized state finances as solvent, but without any excesses that could
lead to increased school support.
Baer said the
public input meetings will be held at Chesterton High School Auditorium on
Jan. 11 and 16.
Prior to those
public sessions, Duneland will host a meeting on Dec. 20 just for staff
members to explain the school financial situation.
members endorsed the public meetings. Board member Mike Trout said the
meetings will help inform the public on the state of school finances in the
past three or four years in Indiana. School Board President Janice Custer
noted that schools are highly dependent on state funding support. “They’re
the ones that give us the money, and they’re giving us less and less,” she