WINSTON COUNTY - A loss of $800,000 in federal funding from previous years, as well as a decrease in average daily membership tied to loss of teacher units and other factors are giving officials with Winston County Schools some good reasons to carefully watch their budget and spending in the next few years.
During the school system’s recent annual budget hearing, Chief Schools Financial Officer Morgan Blankenship explained the financial picture for the school system, reflected by decreases in funding and increases in costs, to Superintendent Jeff Scott and members of the Winston County Board of Education.
“We have developed a very conservative budget because of information we are receiving about the financial outlook over the next two years,” Scott emphasized.
“We are being told there will not be much growth in revenue, so we are doing our best to plan ahead and prepare for those challenges,” Scott added.
“Our goal is to be very frugal with our funds and focus our resources on the things we need, rather than the things we want, while continuing to provide the best educational opportunities possible for our students,” Scott continued.
Several notable changes in the budget compared to previous years included federal allocations, which have dropped from $7,086,886 for fiscal year 2025, to $6,304,593 for FY 2027, Blankenship showed.
“Fiscal year 2025 was the final year of COVID money, so that would explain the decline from 2025 to 2026,” Blankenship noted.
Concerning federal allocations, the system received $6,304,593 for FY 2027, compared to $7,082,906 for FY 2026 - amounting to a loss of nearly $800,000, Blankenship emphasized.
This was in part due to the loss of the school’s Stronger Connections grant of $178,391.16, according to Blankenship.
“We received this grant in (fiscal year) 2024 and its expiration is 2026,” she pointed out.
Another grant the system is losing is Vocational Rehabilitation Services at $33,627, which employed a pre-appointment job specialist, Blankenship explained.
“Then, Title funds decreased by $37,243,” she added.
Increases, as well as decreases in a budget can be tell-tale numbers, such as increases in costs for employee insurance from $9,600 per full-time employee for FY 2025, to $12,576 per full-time employee for FY 2027, according to Blankenship.
“The employee insurance match increase for fiscal year 2026, was the first increase since 2017,” Blankenship stated. The increase per employee for FY 2026 was $10,848, she noted.
“This is a 31 percent increase over two years,” Blankenship stated. “And it is projected that they will increase it again for fiscal year 2028.”
“How much is that for us?” board member Greg Densmore asked.
The amount for the system as a whole would be around $300,000, Scott responded.
Blankenship continued by explaining the Alabama legislature approved a two percent pay raise for all education employees for FY 2027, which includes not just locally funded, but state and federal funded employees.
The state funding allocation for transportation issued to Winston County Schools also increased--from $2,781,049, for FY 2025, to $3,049,796 for FY 2026, to $3,780,769 for FY 2027, Blankenship further explained.
“Our transportation allocation increased by over $700,000 this year,” Blankenship stated. “This is a 36 percent increase from the fiscal year 2025 allocation.”
“Is that a one-time increase or will it stay about at that level?” board member Dr. Kristen McCay asked.
“Every year it is budgeted, but hopefully they will leave it,” Scott then responded. “That is the one thing they tend to go after is transportation before anything else.”
A decline was reported in the average daily membership, which is the average number of students enrolled in the schools during the state’s designated reported period, Blankenship stated.
The ADM for Winston County Schools declined by almost 30 students from fiscal years 2026 to 2027, she said.
This decline was shown in the budget hearing from 2,194.85 students systemwide in FY 2025, to 2,164.10 students systemwide for FY 2027, the presentation showed.
“This is important because ADM is a major determining factor in our funding from the state, so declining enrollment can directly reduce the funding our school system receives,” Blankenship pointed out.
Although some schools in the county system, such as Double Springs Middle School gained 12 students and Addison Elementary gained 18 students from fiscal years 2026 to 2027, Lynn High School lost 19 students and Meek High School lost 14 students during that same fiscal year period, according to a chart. These differences offset each other, Blankenship said.
The three main revenue sources for the school system is the state, which funds over half the revenue at 56.9 percent, compared to federal funding at 12.8 percent and local funding at 28.2 percent with other funding sources at 2.2 percent, Blankenship explained.
For FY 2027, the school system experienced a $1,078,142 increase in state funding from fiscal year 2026, Blankenship added.
Total state funding includes the system’s Education Trust Fund allocation, as well as other state funded grants, she explained.
Several changes Blankenship had marked as critical for state revenue was a majority of the state funding increase being a $730,973 transportation allocation, and another major change in the special education high needs grants at $327,549, Blankenship said.
“All other state allocations have a net increase of $470,247,” she said. “When I say that state revenue is $23.4 million, $4.48 million of that is from our local tax revenue. That is an increase of almost $300,000 from fiscal year 2026.”
Raise Act funding increased by almost $90,000, with the special education category increasing by $41,837 and funding for students in poverty increasing by $46,585, Blankenship explained.
“We use most of these funds for personnel,” she further noted.
The Foundation Program, Blankenship continued, is directly impacted by ADM. “You can see that even though the two percent raise was passed, insurance and retirement amounts increased substantially,” Blankenship pointed out.
Salaries increased from $18,016,815 for fiscal year 2026, to $20,887,679 for fiscal year 2027 - amounting to an increase of $2,870,864, with benefits increasing from $7,006,381 in FY 2026, to $8,870,538 - a difference of $1,864,157.
“This is a direct result of the decrease in ADM,” Blankenship explained. In fact, the decrease in ADM affected certified units, with a loss of 3.38 state funded units from FY 2026 to FY 2027, she said.
“This includes 1.88 teachers, half an assistant principal, half a counselor and half a librarian,” explained Blankenship.
The Child Nutrition Program is a federal allocation, but is based on reimbursement rates and local pass-through revenue, the amount of local funding budgeted to cover CNP shortfalls or deficits for FY 2027.
“When a lunchroom is operating at a deficit fund balance, meaning below zero at the end of the fiscal year, our general fund has to transfer funds to that lunchroom to give them a zero fund balance,” Blankenship explained.
“This is another reason lunch participation is so important. It takes a burden off the general fund,” she added.
The pass-through amount for the CNP is projected at $840,045, but Blankenship stated she did not anticipate using that this fiscal year.
“Last year, I would say we passed through less than $100,000,” Blankenship said. “I just budget that for worse-case scenario.”
All of the students in the county school system continue to receive free breakfasts and free lunches, but fiscal year 2027 marks the last year of this cycle, Blankenship stressed.
“The more meals that are served, the higher our reimbursement,” she explained.
Local revenue had a slight increase from $8.41 million for FY 2026, to $8.89 million for FY 2027, meaning an increase of 5.6 percent, Blankenship stated. Ad valorem taxes account for 57 percent of that local tax revenue, with county sales tax accounting for 35 percent, she added.
“You can see, simplified sellers use tax, I increased that budget by $30,000 based on prior years,” Blankenship stated.
SSUT is the online sales tax, of which Winston County
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