• About
    • About Us
    • What We Cover
  • Advertise
    • Advertise
    • Our Advertisers
  • Contact
  • Donate
  • Send News
  • Subscribe

Oak Ridge Today

  • Home
  • Sign in
  • News
    • Business
    • Community
    • Education
    • Government
    • Health
    • Police and Fire
    • U.S. Department of Energy
    • Weather
  • Sports
    • High School
    • Middle School
    • Recreation
    • Rowing
    • Youth
  • Entertainment
    • Arts
    • Dancing
    • Movies
    • Music
    • Television
    • Theater
  • Premium Content
  • Obituaries
  • Classifieds




School officials say millions in state funding at risk, could close schools Oct. 1

Posted at 8:04 am September 11, 2013
By John Huotari 4 Comments

Bruce Borchers and Mark Watson

Oak Ridge Schools Superintendent Bruce Borchers, left, and City Manager Mark Watson have had a series of meetings concerning the school system’s failure to pass a state maintenance of effort test, and a possible resolution of a $250,000 shortfall to avoid a potential loss in state funding of up to $1.87 million per month.

Schools want city to cover $250,000 shortfall, could require 2.5-cent tax increase

It’s a high-stakes battle between the city and the schools, with a potential loss of up to $1.87 million per month in state funding—and a possible shutdown of the school system on Oct. 1.

School officials said the Oak Ridge system has failed a state maintenance of effort test that requires local funding to remain at least the same from year to year. After some budget adjustments, there is a $250,000 shortfall, school officials said, and they want the city to cover it. It’s the equivalent of a 2.5-cent property tax rate increase.

“Unfortunately, we’re just in the position to ask the city to help us,” Oak Ridge Superintendent Bruce Borchers said Thursday. “They’re going to have to find that $250,000.”

But city officials suggest education officials are overreacting. The municipal staff said it’s not realistic to expect the state to withhold $1.87 million per month in Basic Education Program funding starting Oct. 1 simply because of a possible $250,000 shortfall—equal to roughly about $25,000 per month during a 10-month school year. They said the Tennessee education commissioner has the discretion to withhold all or part of the BEP funding, if, in fact, a shortfall exists.

“Everyone’s jumped out on the ‘sky is falling,’” Oak Ridge City Manager Mark Watson said. A “knee-jerk reaction” to increase school funding would be permanent, he said.

School officials have pressed to have two special meetings of the Oak Ridge City Council and Oak Ridge Board of Education to amend budgets and cover the shortfall, all before Oct. 1. But so far, it’s not clear that the city will agree to that schedule.

“We’ve got to get some questions answered, but it’s not going to move fast,” Watson said. “They don’t have the money. We don’t have the money. So, we have to figure out what’s happening.”

The BEP is about one-third of the school system’s funding, said Karen Gagliano, director of business and support services for Oak Ridge Schools. To put the $1.87 million per month in context, she pointed out that the school system’s payroll is $3 million per month.

“It’s catastrophic if you lose it,” Borchers said of the BEP funding. “We can’t change the revenue, but we bear the consequences.”

Watson said the reaction so far is based on an administrative e-mail from the Tennessee Department of Education. Having Oak Ridge school officials announce that the state will withhold all the BEP funding starting Oct. 1 unless the city comes up with $250,000 is “really unfair and puts us in a hold,” the city manager said.

Maryanne Durski, chief financial officer for the Tennessee Department of Education, was not available for comment Tuesday, and a spokeswoman has not returned a phone call seeking comment.

Oak Ridge education officials have said the schools could temporarily close on Oct. 1 unless the funding issue is resolved this month.

“Should the maintenance of effort situation not be resolved by Sept. 30, Oak Ridge Schools has been advised by legal counsel to not use fund balance to continue operations, and therefore, the only option would be to temporarily close school on Oct. 1 until a resolution is reached,” school officials said.

This particular dispute between the city and schools has its roots in the debate over debt repayments for the $66 million renovation of Oak Ridge High School. That debate centers on whether new revenues generated in Anderson County outside of the city limits under a 2006 sales tax referendum should continue to flow through the schools to the city and be used for ORHS debt repayments—or stay in the school system to be used for operational expenses.

A budget approved by the City Council in May 2012 withheld about $766,000 from the school system, keeping it in reserve until school officials transferred the new revenues raised under the Anderson County sales tax increase.

“They basically just moved away from the referendum, and took that allocation,” Gagliano said of City Council members Thursday.

School officials had argued they can keep that portion of the new sales tax revenues that are collected outside the city of Oak Ridge. Previously, all of that money, as well as the revenues collected inside the city, were used for high school debt payments.

School officials warned the city last year that the move to keep the $766,000 in reserve would put the school system’s budget out of balance, and they suggested it could violate maintenance-of-effort requirements. Municipal officials disagreed.

The $250,000 shortfall now reported by the schools is about equal to the new sales tax revenues said to be collected in Anderson County outside of Oak Ridge.

On Thursday, Watson said the $766,000 was not necessarily withheld since it was used for educational purposes.

“We’re paying the debt for the high school buildings, which we’ll pay until 2041,” he said.

City and school officials have had a series of meetings to try to resolve the funding issue. The meetings have included Watson, Borchers, Gagliano, and Oak Ridge Finance Director Janice McGinnis, but so far no resolution has been announced.

“We want to fix this,” Watson said. “I want to fix this. But I want to do it right.”

Borchers said the Oak Ridge Board of Education made difficult budget decisions earlier this year, and now the city might have to make some tough calls of its own. He said school officials want to get past the immediate problem of resolving the maintenance of effort issues and move on to debt issues.

“We want to fix all of this,” Borchers said.

Read an editorial Watson wrote here.

Read the school system’s explanation here.

Note: This story was updated at 1 p.m.

Filed Under: Education, Government, K-12, Oak Ridge, Top Stories Tagged With: Anderson County, Basic Education Program, BEP, Bruce Borchers, funding, Janice McGinnis, Karen Gagliano, maintenance of effort, Mark Watson, Maryanne Durski, Oak Ridge Board of Education, Oak Ridge City Council, Oak Ridge High School, Oak Ridge Schools, property tax rate, revenues, sales tax referendum, school closure, Tennessee Department of Education

Advertisements

Join the club!

If you appreciate our work, please consider subscribing. Besides helping us, your subscription will give you access to our premium content.

Most of our stories are free, brought to you by Oak Ridge Today with help from our members—advertisers, subscribers, and sponsors.

But some are premium content, available only to members. Those are in-depth, investigative, or exclusive stories that are available only on Oak Ridge Today. They generally require at least four hours to report, write, and publish.

You can subscribe for as little as $5 per month.

You can read more about your options here.

We currently offer five primary subscription options to readers, and they include benefits.

Basic

  • Basic monthly subscription ($5 per month)—access premium content
  • Basic annual subscription ($60 per year)—access premium content

Pro

  • Pro monthly subscription ($10 per month)—access premium content, get breaking news emails first, and submit one press release or public service announcement per month
  • Pro annual subscription ($100 per year)—save $20 per year, access premium content, get breaking news emails first, and submit one press release or public service announcement per month

Temporary

  • Temporary access ($3 per week for two weeks)

We also have advanced subscription options. You can see them here.

We also accept donations. You can donate here.

If you prefer to send a check for a subscription or donation, you may do so by mailing one to:

Oak Ridge Today
P.O. Box 6064
Oak Ridge, TN 37831

Thank you for your consideration and for reading Oak Ridge Today. We appreciate your support.

Commenting Guidelines

We welcome comments, but we ask you to follow a few guidelines:

1) Please use your real name, including last name. Please also use a valid e-mail address.
2) Be civil. Don't insult others, attack their character, or get personal.
3) Stick to the issues.
4) No profanity.
5) Keep your comments to a reasonable length and to a reasonable number per article.

We reserve the right to remove any comments that violate these guidelines. Comments held for review, usually from those posting for the first time, may not post if they violate these guidelines. Thank you for your patience and understanding. Thank you also for reading Oak Ridge Today and for participating in the discussion.

More information is available here.

More Education News

Oak Ridge Police Department Badge

Boy hit by vehicle near JMS

A 10-year-old boy was hit by a vehicle near Jefferson Middle School on Thursday, the Oak Ridge Police Department said. The collision was reported at about 2:48 p.m. Thursday, April 1, on Fairbanks Road north of Dayton … [Read More...]

Oak Ridge Schools Logo

ORHS educator named Claes Nobel Educator of Distinction

Heidi Foster, an educator at Oak Ridge High School, was recently selected as a Claes Nobel Educator of Distinction by The National Society of High School Scholars (NSHSS). "A role model to pupils, Heidi was nominated … [Read More...]

Oak Ridge High School Main Entrance

ORHS student wins first place at Tennessee Junior Science & Humanities Symposium

Oak Ridge High School student Daniel Joy won first place at the Tennessee Junior Science and Humanities Symposium Poster Presentation Competition held virtually in March, the school system said in a press release. The … [Read More...]

Dr. Michelle Cash is Roane State Outstanding Alumni

Michelle Cash By Bob Fowler Roane State staff writer “I always knew I wanted to teach,” says Dr. Michelle Cash, the winner of Roane State’s prestigious Outstanding Alumni Award for 2019. She was to be recognized on … [Read More...]

Roane State student chronicles harrowing escape from captivity in new book

Shown is the cover of the self-published book available on Amazon and written by Bella Hope Shiloh, the alias adopted by a Roane State Community College student. (Photo submitted by Roane State) By Bob Fowler, Roane … [Read More...]

More Education

More Government News

Horizon-Center-Motorsports-Track-6-Feb-11-2020

Motorsports park will not be built in Oak Ridge

Part of the site where a test track and research facility or motorsports park was proposed on the back side of Horizon Center in west Oak Ridge is pictured above on Tuesday, Feb. 11, 2020. (Photo by John Huotari/Oak … [Read More...]

Political redistricting to be discussed at Lunch with League

Debby Gould Political redistricting will be discussed at Lunch with the League in Oak Ridge on Tuesday, April 20. The virtual meeting is scheduled to start at noon April 20. It is hosted by the League of Women … [Read More...]

Death penalty to be discussed at Lunch with League

Marshall Jensen The death penalty in America will be discussed during a Lunch with the League meeting at noon today (Tuesday, April 6). The virtual meeting is hosted by the League of Women Voters of Oak Ridge. It … [Read More...]

City of Oak Ridge Seal

Planning Commission to discuss site plans for storage facility, apartments

The Oak Ridge Municipal Planning Commission will discuss a site plan for the planned storage facility at Main Street Oak Ridge and apartments on Emory Valley Road on Thursday. The storage facility would be built along … [Read More...]

Secret City Festival scheduled for September

A previous Secret City Festival is pictured above. (Photo courtesy City of Oak Ridge) Canceled last year, the postponed Secret City Festival is scheduled for September this year. Normally held in June, the Secret … [Read More...]

More Government

Recent Posts

  • Man pursued by police runs into church, taken into custody
  • Public notice: Draft environmental assessment for Y-12 Development Organization at Horizon Center
  • Public Notice: Final environmental assessment available for Lithium Processing Facility at Y-12
  • THP report: Child hit by pickup walked into travel lane
  • First Presbyterian offers free meals, groceries Thursday
  • Girl hit by vehicle on Edgemoor Road
  • Motorsports park will not be built in Oak Ridge
  • Boy hit by vehicle near JMS
  • Political redistricting to be discussed at Lunch with League
  • The Other One Diner moving to Turnpike

Search Oak Ridge Today

About Us

About Oak Ridge Today
What We Cover

How To

Advertise
Subscribe

Contact Us

Contact Oak Ridge Today

Copyright © 2021 Oak Ridge Today