Due to a continued decline in enrollment and the rising cost of medical insurance and retirement, the School District is facing an estimated budget loss of $427,000 for 2013-14.

Executive Director of Business and Support Services Lisa Martinez told the School Board April 24 that a loss of about 61 students in average daily membership this current school year will take a big bite out of the operating budget.

The loss of 61.338 students from ADM means a loss of $307,000 to next year’s budget.

“But declining enrollment isn’t the only factor affecting our budget loss,” Martinez told the board.

“We’ll also see an increase in medical insurance next year, as well as an increase in ASRS (Arizona State Retirement System).”

The expected increased cost to provide insurance adds another $90,000 to the deficit with ASRA accounting for another $30,000, making the total expected loss at $427,000.

Martinez said that the drop in student count will call for a reduction in force, which should make up about $265,000 of that figure.

A medical plan design change could save another $43,488, and Martinez said that a conservative transfer of $50,000 from capital could help take a chunk out of the expected losses.

That leaves the district with about $68,512 to make up for, something that Martinez said could be found in a voluntary dental plan.

Rather than including dental in district medical insurance, making the feature optional could save the district around $60,000. That, coupled with an extra $8,512 from capital, could cover the full cost of the expected loss.

“With an optional dental plan, employees may choose whether or not they want to have it included in their plans and then their paychecks would reflect that difference,” Martinez added.

As a side note, it was mentioned that, whether or not the board decides to make dental optional, a new optional discounted dental plan will also be available to employees starting in 2013-14.

“If the board does not choose to go that route, then we’d need to put together a budget advisory team and consider other ways to make up that $68,512,” Martinez added.

“But I’ve looked at all of the items we’ve considered in the past and we’re basically talking about programs at this point. Co-curricular stipends, athletic travel, things like that.”

The board will vote on whether or not to make dental an optional part of the health insurance package at a future meeting.

In the meantime, FHUSD is still waiting to hear official numbers from the legislature to nail down hard figures and begin planning for next school year.

“We have no idea what the legislature will do,” Martinez said.

“We don’t expect any further cuts and we’re even hearing that they may be able to get us some additional funding this year, but there’s no way to plan for that until we know for sure.”