The Oak Ridge City Council will meet in a special session Tuesday evening to consider a one-time $250,000 transfer to the city schools, which could avert a potential loss of millions of dollars in state funding and avoid an Oct. 1 school shutdown.
The special meeting starts at 5 p.m. Tuesday in the Oak Ridge Municipal Building Courtroom.
Oak Ridge City Manager Mark Watson told Superintendent Bruce Borchers last week that Council had agreed to the special session to resolve the $250,000 shortfall but wanted documentation. Watson asked Borchers to respond by noon Monday.
The superintendent did so.
“We were notified by Commissioner (Kevin) Huffman’s office on July 30, 2013, that our budget will be nullified if not corrected by Sept. 30, 2013, along with the state withholding $1.8 million/month in state funding to the Oak Ridge Schools,” Borchers said in a Monday letter to Watson.
In order to avoid the withholding of the state money, the city’s intent to increase the school system’s funding by $250,000 must be verified in writing by Sept. 20, Borchers said. The school’s budget would then have to be amended in two school board meetings, and the amended budget sent to the state by Sept. 30.
The Oak Ridge Board of Education has already scheduled a special meeting at 5:30 p.m. Sept. 23, presumably to consider the amended budget.
Oak Ridge Schools have failed what is known as a maintenance of effort test. It ensures that local revenues remain at least the same from year to year. The original shortfall for Oak Ridge was $393,918, but school officials were able to reduce it to $250,000 through budget changes.
School officials said the shortfall originated in City Council’s decision in May 2012 to reduce school funding by $766,470.
“While other local tax receipts have closed much of that gap, we respectfully ask that the city honor the requirements of state law and increase Fiscal Year 2014 funding to the schools by $250,000,” Borchers said.
That decision was part of a dispute between city and school officials over how to spend new revenues collected in Anderson County, but outside Oak Ridge, under a 2006 sales tax referendum. The money had been used to help pay down the debt on the $66 million renovation of the Oak Ridge High School, but school officials said a five-year “gentleman’s agreement” had expired and the money should be used for school operations.
More information will be added as it becomes available.
See the special City Council meeting agenda here.
Note: This story was last updated at 6:05 p.m.