Superintendent Recommends $50.8 Million Gross Budget

This budget season will be a transition year – a new superintendent and interim finance director, new financial software, an earlier budget schedule and the superintendent's recent recommendation of a $50,861,847 gross budget to the Board of Education.

“I believe the budget reflects comprehensive review of all our past expenditures," Mala said at the school board special meeting Tuesday night.

On first glance, Superintendent Gary Mala's presentation could look like a $3.7 million increase over last year's $47,098,247.

Not so.

The town and the school board are budgeting in a gross format instead of net this year.

"The gross number is the actual cost of every line item that we anticipate. A budget is an estimate.... That is what we estimate as being the cost," Mala said. "Then, the revenues that we receive are attached, aligned with gross expenditures, thus reducing those numbers. Then what ends up resulting is a net budget."

In other words, the primary difference lies in how the anticipated revenue is being accounted for and whether it is included in the budget total. Gross tracks revenue yet excludes it in the budget figure, whereas net budgets reflect the product after revenues have been applied, and therefore subtracted from the estimated gross expenditures. So, at face value, the gross seems larger.

Mala's staff manually went line by line through the current fiscal year school operating budget and calculated that it was the rough equivalent of a $49,420,920 gross budget. That technically makes his proposed budget figure a $1,440,927 gross increase over the 2011-12 adopted budget, a 2.92 percent increase, if you subtract it from the $50.8 million. His proposed gross budget incorporates an anticipated $4,019,039 in revenue. School district financial staff calculated $2,322,673 in estimated revenues for 2011-12.

"We would concentrate on the gross budget this year to next year. That's the focus," Gina Casper, Avon Public Schools accountant, said. "We looked at our adopted budget and we went through every line to determine which lines are net and which lines are gross. If it was a net number, we grossed it up to give something for the people to compare it to."

It gets more complicated when Mala's recommended $50.8 million gross budget is converted to a net amount, $46,842,808. Net is what ultimately affects the tax rate. The adopted $47 million 2011-12 budget is not exactly net, Casper said, so while it may look like the estimated net request for 2012-13 is a decrease, that is not necessarily the case.

"The thing is to look at the two gross numbers," Mala said.

Comparing the 2012-13 recommended budget to the 2011-12 adopted budget may be fruitless, no matter how many apples to oranges analogies you throw at it, because gross is different than budgeting net. The more accurate comparison will be evident next year because by then the 2013-14 proposed gross budget will be marked against the town's first gross budget.

It has not been determined whether voters will see a proposed gross budget or net budget on the ballot.

The school board invites the community to the Avon High School Community Dec. 1 at 6:30 p.m. to give input about Mala's recommended $50.8 million gross budget. Board of Education budget workshops are scheduled for Dec. 5 and 8 at 6:30 p.m. in the same location.

By its Dec. 20 meeting, the board plans to vote on a proposed budget. The board's request will then be submitted to Town Manager Brandon Robertson for review as he finalizes his recommended 2012-13 town, debt services and capital projects budgets. Robertson is scheduled to present all proposed components of the budget, including the school operating budget, to the Town Council on Jan. 20, according to the school board's budget calendar.

Editor's Note: Check back for an update on the breakdown of Mala's recommended 2012-13 gross budget.

*Affects the tax rate