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Board re-hires SES for fiscal update to municipal schools feasibility study

By Bill ShortFlag City Logo

The Millington Board of Mayor and Aldermen has re-hired Southern Educational Strategies to update its 2012 study on the feasibility of creating a municipal school district.
Board members took the action during an Aug. 12 special called meeting on a motion offered by Alderman Hank Hawkins and seconded by Alderman Thomas McGhee. The motion was passed by six affirmative votes, with Alderman Mike Caruthers absent.
Dr. Jim Mitchell, a founding partner of SES, said the legal and operational information provided in the 2012 study remains accurate. But the proposed revenues and expenditures in the fiscal data section should be updated for the 2014 fiscal year.
Mitchell said the purpose is to reflect changes made in the Tennessee Basic Education Program funding formula and in revenues from local and Shelby County property and sales taxes. He also said the projected student enrollment for the 2014 fiscal year should be updated for the schools in Millington.
Acknowledging that the fiscal data represented the “most complex” section of the original feasibility study, Mitchell said it required more than 50 percent of the preparation time.
He noted that an updated fiscal data section will include revised projections for student enrollment, revenues from county property and sales taxes, the BEP, municipal taxes and operating expenditures.
“As you know, we’ve had a major property reappraisal,” he said. “That affects any values of property here in your city and other cities in Shelby County.”
Mitchell also noted that the county commission recently approved an increased amount of funding for schools. So, if Millington creates a municipal school district, it will be entitled to its share of those county property tax revenues.
He recalled that, when SES gave the previous board a report on its original feasibility study in March 2012, Millington residents had not yet voted on whether they wanted to increase the Local Option Sales Tax by half a cent. Now, SES has “actual data” about the amount of revenue that the approved tax increase is producing.
Mitchell said the original feasibility study was based on the board’s desire to know what it would cost to operate a school system with a staff comparable to what Millington had in the 2011-2012 academic year. But he noted that, under the new unified school district, the staff has been cut “fairly substantially” at some of the Millington schools.
He said the revised expenditure projections can be calculated with either one of two school personnel staffing models: (1) the 2012 fiscal year model used in the original study, or (2) the proposed 2014 fiscal year unified school district staffing formula.
The SES fee to provide an updated fiscal section is $31,500 with the first model or $37,800 with the second one.
“Actually, it’s more time-consuming and more costly to try to use the staffing formula that is being used now,” Mitchell acknowledged, “because we’re really not quite sure exactly what that formula is. We know what it was, and that’s what we would propose.”
The board chose to use the first model, with the fee to be paid from revenue generated by the half-cent local sales tax increase.
When McGhee asked whether the original formula will work after the municipal school district lines are drawn, Mitchell said student enrollment will determine “almost everything.”
“We could go back and use those formulas that were in place, based on class-size requirements set by the state of Tennessee,” he noted. “And once we know how many children we’re dealing with, we can apply that.”
In response to a question by Alderman Bethany Huffman, Mitchell said SES expects to present the updated study to the Millington School Board members by Nov. 15. Then, they can decide whether the chosen staffing model still works, or what they would need to do at that point.
“Your elected school board will ultimately make all those decisions,” Mitchell said. “What we would hope to have in its hands at that time would be an accurate projection of what your revenues and expenditures will likely be.”
During a presentation by SES at the board’s Aug. 5 regular monthly meeting, Caruthers recalled that Millington was establishing a “transition team” last year before U.S. District Judge Samuel “Hardy” Mays issued his ruling in late November. Caruthers wondered whether the city should do that this time, or wait until the school board is sworn in and then seek assistance from the Tennessee School Boards Association. Mitchell said it would be difficult for him to answer that question until he has reviewed all the things that the transition team produced.
Although the school board will be elected on Nov. 7 and can be sworn in after the results are certified, Mitchell noted that it cannot take any action until Dec. 1.
“However, some things can be done ahead of time,” he acknowledged. “It’s usually helpful if you have a group of experienced citizens who can start some preliminary work before the school board is elected. You would gain some time and, perhaps, some ability to have some decisions ready for the board to consider in December.”
Caruthers said he knows that the TSBA will help write the school board policies and provide training for its members. He also believes it will help with the superintendent search after the board becomes a member of the association.
While agreeing that the TSBA can help, Mitchell noted that it does not write board policies or conduct superintendent searches at no cost. It charges a fee for those services.
In its work with the other suburban municipalities, Mitchell said, SES has identified “40 major tasks” that must be completed before a school district can be opened. And most of those have to be done by April or May 2014. In response to another question by Caruthers, Mitchell said those tasks will not be a part of the updated study, because they are included in the “second part” of the contract.
“If you want us to assist in other areas, which we certainly are capable of doing,” he said, “then we would propose that you consider an hourly services agreement, so that you only pay for what you use.”
When McGhee asked what the student population will be, Mitchell said SES has the “most accurate” information that can be obtained.
“In March 2013, the entire Shelby County Schools student enrollment was geocoded,” he said, “so that we would know students exactly by residence, grade level, school and zone. We obtained that data, because we thought probably every town would need to have it.”
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