Budget Department

From 2007-08 through 2011-12, the St. Johns County School District saw its amount of funds per student decreased by the Legislature. When funding reductions occur, the District still remains responsible for managing student growth, maintaining constitutional class-size requirements, opening new schools and most recently implementing a new teacher evaluation system.

Although the 2018 Legislature increased funding for St. Johns County schools by approximately $17.7 million, the financial and economic pressures still facing the District are tremendous. As an example, despite the increase of 8.7 percent in property value this year, the capital outlay millage remains at 1.5 mills rather than the previous levy allowed by law of 2.0 mills. Thus, the ability to raise revenue commensurate with the District’s capital needs is severely restricted. Revenues for the Local Capital Improvement Fund are projected to be $40.5 million, or approximately $3.3 million more than the prior year; yet the 2007-08 Local Capital Improvement Funds generated approximately $46.8 million. This equates to an approximate 13 percent decrease in revenue for capital projects, while at the same time the number of students being served increased by 46 percent from 27,737 students in 2007-08 to 40,654 students in 2018-19. Since 2007-08, the capital outlay budget has lost access to more than $251 million. This revenue loss will continue to jeopardize our ability to maintain existing schools or build new ones as needed. In addition, the ongoing lack of both operating and capital funding could negatively impact the District’s credit rating and its ability to efficiently manage its debt.

On November 3, 2015, in an effort to help alleviate the capital funding problem brought on by the aforementioned decreases, the School Board asked the general electorate of St. Johns County to approve a half-penny sales surtax initiative solely for the purpose of funding new construction, renovation/remodeling projects, technology and safety and security measures. The sales tax referendum was passed with more than 60 percent support. This new revenue stream will add approximately $19 million per year, or about $204 million during the 10-year period for necessary capital projects. The District built one elementary school and one K-8 school with proceeds from sales tax revenue bonds that carry an average annual debt service of approximately $6 million, leaving roughly $13 million for “pay as you go” capital projects.

The District’s revenue and expenditure budgets have changed significantly since July 2017. Highlights of the 2018-19 budget process are as follows:

    • State & local funding has increased by approximately $17,683,069.
    • Per-student funding for 2018-19 is $7,331, approximately 2.4 percent over the prior year; also the Base Student Allocation increased only 47 cents per student.
    • Student population for 2018-19 is projected to grow by 3.8 percent, or 1,493 students.
    • As a result of the lack of state funding, loss of the stimulus funding, continued student growth and other downward pressures on the budget, the District is forced to use approximately $12.3 million from its fund balance to sustain school operations during 2018-19.
    • The 2018-19 budget will provide 90 additional instructional staff units.
    • The Florida Legislature increased the Safe Schools allocation by $1.4 million with the mandate that the funds be used to secure a School Resource Officer in every school and another approximately $1 million for a new Mental Health Allocation mandate for certain mental health services to be offered to our students.
    • Other pressures on the District’s operating budget include the proper funding mechanisms and related plan designs for its self-insured medical plan, mandated increases in the Florida Retirement System contributions, the funding of the teacher performance pay system and the continued funding of the digital learning initiative, as well as the continued staffing changes necessary to maintain support of teaching and learning in our schools.
    • In addition, as a result of the 2018 legislative session, the Florida Legislature approved SB 7026 and SB 7055 which are far-reaching bills that impact several different areas of the public K-12 education environment. The full financial impact of these bills has yet to be completely identified in all relevant categories for the upcoming fiscal year.
    • Finally, as a result of receiving only a 47 cent increase in the per-student base funding for 2018-19, the District will have to begin to look at operations differently on a going-forward basis. This will be the third year in a row the Legislature has “rolled back” the Required Local Effort in order to not raise local property taxes. This trend is not sustainable and needs to be addressed before its impact becomes distressing to school districts around the state.

Florida continues to be in the lowest tier in the nation in terms of per student funding for operational needs when compared to other states. As previously mentioned, the funding did increase for 2018-19; however, the state has a long way to go to restore Florida K-12 funding to the 2007-08 level.

It cannot be overstated that the District’s capital and maintenance expense budgets continue to be restricted. This is due mainly to the fact that the District student population is growing by 3.8 percent this year and, as stated earlier, has endured several years of declining capital revenue. In fact, the 2007-08 capital fund generated approximately $46.8 million. The same capital fund will generate only $40.5 million in 2018-19. As a reminder, the Florida Legislature reduced the allowable millage levy from 2.0 mills to 1.75 mills in 2008-09 and then again to 1.5 mills in 2009-10. It currently remains at 1.5 mills for 2018-19. For the foreseeable future, capital and maintenance projects must be prioritized with a focus on critical needs only. The District continues to be forced to move from being prepared for growth and using preventive maintenance (in order to minimize costs) to only meeting critical needs.

Although the aforementioned new sales tax revenue adds approximately $13 million to the capital budget, it is only a fraction of what is truly needed to address the backlog of new construction, technology, safety and maintenance demands. This need will only continue to mount over the life of the sales tax revenue stream, which runs through December 2025.

Finally, if the District does not see an improvement in per-student base funding in the near future, it will be necessary to once again reduce operating and capital expenditure costs so there is not an emergency when our fund balance has been exhausted.

In closing, past performance is a good predictor of future performance. To review our past financial performance, please visit our web page at www.stjohns.k12.fl.us, and click on Financial Transparency. There you will find detailed information about your school district’s financial activity.