On the FY22 quarterly transfers

 You didn't think I'd forgotten, did you?

At the last meeting of the Worcester School Committee, I gave the report from the Finance and Operations subcommittee meeting of February 9, which included the second quarter report, included $7.1M in transfers and an update on about $4M in ESSER funding for the current (FY22) budget year.

What does that mean? 

About every three months, administration gives an update to the F&O subcommittee on where the district is with the budget that was passed in June. That's not only how much has been spent from which account and how much then is left of what was budgeted; it's also a calculation done by the budget office of how much the district is projected to spend. In other words, given what we know--how many positions aren't filled, what services are running ahead or behind what was thought, and so forth--how much is the district probably going to actually spend in each account by the end of the fiscal year in June? 

This time--this was the second quarter report--there were some big shifts. More than anything else, that's due to two things, both of which we'd rather weren't true:

• We have--or had at the time of the report--263 positions that are open. Those are positions for which we budgeted, that we have the salary and health insurance funding for, that haven't been filled this year.
• Durham isn't running 27 of the routes that the district contractually requires of them. Routes that aren't run aren't paid for. 
  

All of us would rather have the staff positions filled and the school bus routes running. We don't, though, and so the transfers:

• took all of the funding so far for the positions--salary and health insurance--and moved them elsewhere. Thus (and Member Kamara asked this question at the meeting) no positions are cut through these transfers. 
• took all the funding through the end of the year for the bus routes and moved them elsewhere, as the expectation is that those routes will not be done this year by Durham.

That not only means that the district had the $7.1M to move (and you can see more on where and why in the quarterly report linked above), but it also means that the district has enough funding in the operational budget to cover just over $4M of what was supposed to be funded through ESSER funding as hold harmless this year.

What does that mean? Here's an analogy I used earlier this week; see if it helps.
Say you're running a regular household budget--salary coming in, expenses on things like rent and electricity going out--and something happens with your job. You expect that you aren't going to be earning as much for a time; maybe your hours get cut, but only for a few months. You have reason to expect that the money coming in will go back up.
At the same time, you have a tax refund come in, or someone sends you a gift of money; it's a set amount of one time funding. You decide that you can use this one time money to fill the hole of that expected loss of income.
After you make this plan, something happens that cuts your expenses through loss of service. Say you can't get cable any more. That also means, though, that you don't have to pay for that service anymore, and as a result, you use that savings to cover the loss of your income.
What that means is now you have that extra money still around. 
That's what has happened here: the district has lost service (positions that are unfilled and bus routes that aren't run); we're using that savings to cover expenses that we were going to use ESSER for. Now that ESSER goes back to the unused and to-be-committed category. 

And that is where we are on the budget in the third quarter.