It’s going to be a tough year, but it could be worse.

That was the message delivered by Cullman County Board of Education CFO Randy Dunlap Thursday night at the second public budget hearing for the 2010-2011 fiscal year.

The financial outlook has improved since a budget hearing in early August, when Dunlap presented a bleak picture that saw the system possibly ending 2011 in the red.

Since that time, some extra funding has been announced via the federal jobs bill, which should bring an additional $2 million to the county system. This will likely be the last influx of funds, as assistance from the federal stimulus program is expected to run out at the end of 2011.

“They pulled another rabbit out of the hat, but I believe that hat can’t have too many rabbits left in it,” Dunlap said. “For us, this means $2 million to retain jobs with and pay salaries.”

Dunlap said some changes have been made to the budget, which now divides the $2 million among numerous different departments.

“Because of the jobs bill, we shifted several things and re-thought a lot of what we were doing,” he said.

One major change in the latest budget draft is the fact that no money is being “flexed,” or moved from one account to another to fund more immediate needs.

“We were using our [school bus] fleet renewal money for transportation, but not anymore,” Dunlap said. “The maintenance budget has also been cut back over the years, and over time our facilities have suffered because of that, so we put $900,000 back into systemwide maintenance.”

The brunt of the jobs bill funding — more than $1 million — will pay the salaries of 46 bus drivers. Dunlap said that was a critical need due to the fact that the transportation budget has faced numerous cuts over the last two years.

“The transportation fund is almost $1 million under-funded, and we would of had to pay that out of the general fund,” he said.

The rest of the jobs bill will be divided into teacher salaries, an instructional aide, preschool funding, a copier budget and contingency funds.

Though the extra money has been budgeted, Dunlap said there is a very good chance most of it could be used to absorb a third year or proration, if it is announced by the state in the coming months.

“If there is proration, we can pull that money back out,” he said.

The overall projected general fund revenues total $63.8 million, and expenditures top $61.1 million. If the budget stays that way, the system could end the year $1.7 million in the black.

It will depend on how much potential proration is declared to determine if the system will end the year in the positive, or in the negative, Dunlap said.

“If proration is at 4 percent or less, we should end it in the black,” he said. “If it’s more than that, we could have to borrow money to pay the bills.”

Borrowing money has become a fairly common occurrence this year, as more school systems struggle under budget cuts. Twenty-five school systems in Alabama anticipate having to borrow money within the next few months to remain in operation, according to the state department of education. Two school systems, Coosa County and Sumter County, have already been taken over by the state because they’ve essentially reached their lending limit.

But, Dunlap hopes that won’t be a problem Cullman County has to face this year.

“Hopefully, proration won’t be declared, and we can provide better services for our students and things will look a little brighter,” Dunlap said.

‰ Trent Moore can be reached by e-mail at trentm@cullmantimes.com, or by telephone at 734-2131, ext. 220.