By EMILY BEHLMANN

ebehlmann@gctelegram.com

Garden City Community College trustees are proposing to use leftover and reserve funds to keep the college's tax rate increase at about 1 mill for the 2008-09 fiscal year, instead of the 2-mill increase President Carol Ballantyne had proposed Wednesday.

The board voted 5-0 at a retreat Saturday, with trustee Steve Sterling absent, to publish a budget that would set the mill levy at 20.20 mills, up from last year's 19.201. The proposed budget must be published before a hearing set for 6:30 p.m. Aug. 13, where the board can hear public comment before making a final decision.

A 20.20-mill rate means taxpayers would pay $20.20 for each $1,000 in assessed valuation of their home. The owner of a $100,000 home has an assessed valuation of $11,500, and would pay $232.30 toward the college for the year -- up from last year's $220.81.

Ballantyne said the mill levy was set on the assumption that the assessed valuation for Finney County, GCCC's tax base, would be $471,591,128, even though a preliminary report from the Finney County Clerk's Office set the valuation $17 million higher. That's because the preliminary report included Conestoga's Bonanza BioEnergy plant, which could be granted an exemption and abatement from the state Board of Tax Appeals.

If the valuation changes from the $471,591,128 projected, the mill levy will be adjusted accordingly, Ballantyne said. Regardless, under the proposal, GCCC would take in $9,037,952 in local tax dollars for the general fund, plus $487,711 for its capital outlay budget, which goes toward buildings and equipment.

To make up the rest of the proposed $16,304,344 operating budget, other major revenue sources would include a state operating grant of $2,831,491 (or possibly up to $56,630 less as a result of state revenue shortfalls) and student tuition, projected to be up from previous years at $1,445,168.

Salaries and benefits

The proposed budget includes a 3.5-percent raise for staff -- up from the 2.5 percent recommended Wednesday -- and funds to cover a full, single health insurance policy for each staff member.

Ballantyne made the recommendations for the higher staff raise and the lower mill levy after she and other administrators heard trustees' feedback Wednesday, then reworked the budget.

She said that after looking at other local public entities' pay and benefits, she thought the 3.5-percent increase and the insurance coverage were necessary.

"It's very important to us we maintain the staff we have," she said.

Trustee Terri Worf expressed agreement, saying the cost of replacing and training new employees makes it monetarily worthwhile to keep current ones by providing good benefits.

Currently, GCCC pays $367.88 per month for the insurance policies, leaving staff with $61.21 to $81.51 to pay monthly, according to Human Resources Director Cathy McKinley. However, it could cost a lot more soon, as Blue Cross Blue Shield said GCCC's rates would be increasing by 28 percent in October, according to Ballantyne. She said she hopes to find a lower cost by bidding the insurance out to other companies.

Still, the "worst case scenario" of sticking with Blue Cross Blue Shield and covering full staff policies would cost an additional $263,525. The staff salary raises would cost an additional $215,340, and faculty raises, negotiated as part of a three-year agreement, would cost $157,244 on top of the current budget. Other "uncontrollable cost increases," like gasoline, utilities and postage, would add $328,700.

Faculty are the college employees who teach, while the others, from deans to maintenance workers, are considered staff.

The 2008-09 fiscal year is the last of the three-year faculty agreement, and Ballantyne said she expects faculty will ask for the same level of insurance coverage as staff when they start a new negotiating process in the coming year. Currently, GCCC pays $301 per month toward each faculty member's health insurance, according to McKinley.

Most faculty will receive a 5- to 6-percent salary raise for 2008-09 under terms laid out in the agreement, McKinley said.

For Ballantyne, the board approved a two-year contract on Saturday that gives her a 4-percent raise, bringing her 2008-09 salary to $123,675.22. She also receives benefits including health insurance coverage, $2,400 for automobile expenses, a physical exam, $15,000 of life insurance, three weeks paid vacation, Rotary Club dues and cell phone or Blackberry fees, according to the contract.

Carryover and reserves

Ballantyne's proposal for the 1-mill increase and a 3.5-percent staff raise was a change from her Wednesday proposal that would have brought in about $471,500 more in taxes while costing about $36,000 less in salaries.

She said that after Wednesday's discussion, she gave more consideration to the other taxes residents would be paying, such as the proposed 3-mill increase by the city of Garden City. Governing bodies for Finney County and the Garden City and Holcomb school districts were to consider budget proposals today.

Ballantyne also mentioned the bond issue USD 457 Garden City is placing on the ballot in November for a new high school and renovations at other buildings.

"When looking at 2 mills, I thought it would build up cash reserves ... but we need to be good partners and look at what others are doing," she said.

She said the changes in her proposal were possible partly because the funds GCCC will carry over from 2007-08 were higher than projected -- a result of an insurance payment for hail damage, a few cancelled purchase orders and more interest and out-of-state tuition than expected -- and partly because of a planned use of some reserve funds.

GCCC also will forego purchase of two of the four minivans Ballantyne initially had asked the board to approve on Wednesday, which saves about $50,000.

The college will carry over $1,033,890 from 2007-08, and that would take care of most of the planned expenses not covered by expected new revenues, said Dee Wigner, dean of administrative services. In addition, the college plans to use about $17,000 from its reserve fund, which would leave it at $3,744,444, she said.

A board policy states that the reserve fund should be maintained at no less than 20 percent of GCCC's general fund, but in recent years, college officials have tried to keep it closer to 25 percent. However, in last year's budgeting process, the board approved using some reserves, and to do so again would leave the reserves at about 22 percent of the general fund.

Trustee Merilyn Douglass questioned whether keeping more in the fund would be a good idea, in anticipation of future expenses such as an expected increase in faculty insurance for 2009-2010 and later. Worf also indicated that it wouldn't be wise to continue depleting the reserve fund.

"We can do that this year, but it needs to stop," she said. "At 22 or 23 percent, we're barely over the 20 percent we set."

However, trustee Bill Clifford said that as the economy is uncertain for the college, it's also uncertain for the citizens, and everyone is "dipping into their cash reserves" to get through.