J. H. Osborne • Aug 14, 2008 at 12:00 AM

BLOUNTVILLE — The Sullivan County Board of Education (BOE) took no action Thursday on a proposed $91.4 million budget for the school system for the fiscal year that began more than six weeks ago.

It was the BOE’s first look at the revised budget proposal, presented by Director of Schools Jack Barnes.

The board voted to meet in called session, again, next week to consider the budget.

As presented Thursday, the proposal suggests using more than $2.6 million of the school system’s estimated $6 million fund balance to offset a gap between projected revenues and projected spending.

The school system’s estimated revenues for the fiscal year are about $88.8 million, according to a “budget synopsis” distributed by Barnes.

The system’s budget for the fiscal year that ended June 30 was about $90.33 million, according to that synopsis. But the system’s actual expenditures for the year that ended June 30 totaled about $88.3 million, according to earlier budget materials given to the BOE.

Barnes has urged caution regarding use of fund balance. The system needs the fund balance to provide cash flow, to use in emergencies that occur throughout the year, and it’s hard to predict whether you’ll need the fund balance again, or how much you’ll have, a year from now, Barnes said last week.

At a called meeting Thursday, BOE Chairman Jack Bales said the $2.6 million would be the most fund balance ever used in a single year to balance the system’s budget.

“Sooner of later, it’s going to catch up with us,” Bales said, adding that economic conditions can have a significant impact on the system’s fund balance from one year to the next.

With no budget in place for the fiscal year that began July 1, county government is operating on a “continuing” budget — meaning departments and organizations can spend at the same level as during the 12-month period that ended June 30.

If the county commission fails to submit an approved fiscal year 2009 budget to the state by Oct. 1, the state will withhold state funds.

State law requires publication of the budget in the newspaper at least 10 days prior to a vote. A public hearing is also required.

In a called meeting earlier this month, the budget committee voted to recommend keeping the county’s property tax rate at $2.53 (per $100 of assessed value) for the budget year that began July 1.

Development of an actual budget, however, is yet to come.

The BOE agreed Thursday to meet again at 4 p.m. on Aug. 19.

The budget committee is next scheduled to meet in called session Aug. 20 at 6 p.m. on the second floor of the historic Sullivan County Courthouse.

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