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After leaving staff raises out of its draft budget, the Hardin County Schools board discussed the possibility of giving a 1 percent cost-of-living raise to employees at a special meeting Thursday.
Despite the discussion, nothing was decided. Board members said they needed more information on the district’s financial outlook before voting.
Superintendent Nannette Johnston brought the proposal before the board because she and district officials felt this might be the only opportunity to provide a cost-of-living raise in the near future. While staff members have received raises based on experience in the past, they have not received cost-of-living raises since 2008.
Johnston said the outlook for the 2014-15 fiscal year is worse than this year. She does not expect to provide this kind of raise at that time. Johnston said she feels the 2013-14 fiscal year is the time to add in a wage increase.
“My concern is it’s been four years, and it looks bleak next year,” she said.
A 1 percent salary increase would cost the district about $750,000, Finance Director Jessica Annis said.
Board members, however, were hesitant to make decisions without knowing how much tax revenue they could expect — information the district won’t receive until July.
Tax revenue is based on property value assessments. Annis told the board the PVA office predicts little growth in assessments this year.
The board has an opportunity to set tax rates in August. It then sets a rate that will bring in the same amount of revenue as the previous year, known as a compensating rate, one that would increase revenue by 4 percent or falls between those two options. But assessments must be determined before the board can calculate how much revenue each option creates.
If assessments are high, a rate that would increase revenue by 4 percent could be lower than the previous year’s rate. If assessments are low, it could raise the rate.
Last year, HCS set a compensating rate of 58.7 cents per $100 on assessed real and personal property.
Annis said the 2013 budget could sustain a cost-of-living raise no matter what tax rate is set, but that in upcoming years, compensating tax rates wouldn’t be enough to support the salary increase.
Johnston said setting compensating rates would not just mean losing out on a staff raise. It wouldn’t be enough to support the district and its increased operating costs, nor could the district afford goals such as a new college and career center.
Salary increases can be added after August when the board sets a tax rate, but it makes payroll more difficult because of the need to pay staff retroactively, Annis said.
Kelly Cantrall can be reached at (270) 505-1747 or email@example.com.