DENMARK - After experiencing a fund balance deficit of $162,000 more than two years ago, Bamberg School District 2 officials announced the figure is now in the black in excess of $1.1 million.

Superintendent Dr. Secaida Howell says the positive fund balance is the result of a number of cost-saving initiatives.

"We never want to operate at a deficit again, and we don't want to tap into the fund balance if it's not necessary," Howell said. "Even so, we might have to consider using some of this new fund balance to shore up areas of instruction in the not-too-distant future. While we are not yet at the point of having to furlough administrators, class sizes may need to be larger. But nothing except more state cuts is certain yet."

Howell said the turnaround is remarkable for a small, rural school district, especially in tough economic times. He noted the Denmark-Olar district's progress during the last two years was recognized as a Bright Star in the "Hallway of Hope" by the S.C. Council on Economic Education in its Winter 2008 publication, "For What It's Worth."

Rodney Anderson, district director of business operations, said, "We have never had a fund balance this high. The highest it has ever gotten is around a little over one half million dollars." Anderson also noted that in past years with a low and negative fund balance, the district administration would be on pins and needles when it came time to process payroll and accounts payable.

A school district's fund balance represents the budget's total assets minus its liabilities, according to a release issued by Bamberg School District 2. The board itself determines the fund balance amounts to be retained for contingency or "rainy day" needs or used to fund expenditures of the next fiscal year.

The release noted that an appropriate fund balance can help the district avoid excessive short-term borrowing, thereby avoiding associated interest costs; accumulate sufficient assets to make designated purchases or cover unforeseen expenditure needs and, by demonstrating financial stability, preserve or enhance the bond rating, which lowers debt issuance costs.

Bamberg 2 board Chairman Alvin Maynor said, "We are steadily making progress in the district. However, the fund balance is for emergencies. While I cannot speak for the board, we will listen to the superintendent and the finance director and make a priority list of items that still need to be addressed. I imagine this will come up, not as an agenda item, but possibly sometime after we hear our official audit report scheduled for Jan. 12."

Upon taking over as district superintendent in March 2006, Howell said a number of actions were instigated to address the fund balance deficit.

"One in particular involved looking at the class sizes at (Denmark-Olar) high school," Howell said. "When I arrived, we had small classes with about 10-12 students. The problem was we weren't seeing any academic gains at year's end. What was wrong is we had too many teachers in particular areas, but we weren't getting enough bang for the buck. So we downsized through attrition and worked with the master schedule that resulted in larger class sizes. But there is nothing wrong with 18-20 kids in a high school class.

"District-level administrative positions that we didn't need were also cut," he said. "Through that, we were later able to replace a position at the school level. Another significant action was holding off spending money on cosmetic work for our buildings. We just cleaned, polished and took care of what we have, but that also made a sizable difference."

Howell said the school district has already lost several hundred thousand dollars through state budget cuts since the beginning of the school year in August. A proposal to freeze teacher salaries across the state will go before the Legislature in January.

Howell also talked about the need for what he termed "real strong financial planning" that will need to be done in order to keep the district fund balance in the black and not adversely affect instruction.

"We've got to do a better job in food services," Howell said. "We have to do better in the supplies we purchase and look at our programs - anything tied to the general fund. We are aggressively pursuing grants even though those grant programs are holding back right now."

T&D Staff Writer Phil Sarata can be reached by e-mail at psarata@timesanddemocrat.com or by phone at 803-533-5540. Discuss this and other stories online at TheTandD.com.

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