Northport Public School students could have a new part-time music teacher in
place by the time school starts this fall.

The possible addition of a music teacher is one component of the proposed
2007-08 budget that will be the subject of a public hearing that the
Northport Board of Education will hold at its June 14 regular meeting. Board
members received copies of the proposed budget at its rescheduled regular
meeting on Wednesday, May 9.

The proposed three-fund budget forecasts total revenues and expenditures of
$3,457,107, up 2.8 percent from $3,363,068 for 2006-07. The proposal also
calls for $3,272,432 in general fund revenues and expenditures, up 2.8
percent from $3,181,968 for the current school year.

Hammersley said the general fund balance is expected to be $881,811 as of
June 30, 2007. However, she said the board may still need to dip into the
fund balance for the 2006-07 school year. "I won't know for sure until
sometime in mid June. We have built the 2007-08 budget so we don't need to
dip into the fund balance for next year," she said.

The athletic fund increases 10.7 percent for 2007-08 in both spending and
funds received, from $71,100 to $78,725. Business manager Karen Hammersley
said most of the increase in revenue and expenditures comes from moving the
athletic fund¹s transportation costs out of the general fund and into the
athletic fund. The school lunch fund revenues and expenditures decrease 3.7
percent from $110,000 to $105,950. Hammersley said the district has reduced
the school's cafeteria staff from three full-time positions to one full-time
and two part-time positions.

When the Northport board had to reduce the teaching and professional staff
by one-third in 2002 and 2003, cuts included a full-time music teaching
position. Since then, there have been repeated requests from the public and
board members to reinstate the music teaching position.

The board¹s finance and negotiation subcommittee has included funding for
two part-time positions for 2007-08: a music teacher, and a technology
position. Hammersley said Northport officials are talking with their
counterparts at Leland and Suttons Bay schools to gauge their potential
interest in the plan. "We're looking at sharing a teacher for music," she
said.

For the technology position, Hammersley said Northport is working with other
county schools to see if the Traverse Bay Area Intermediate School District
could provide a full-time person to be shared among the county schools.
Other noted increases in the general fund are health insurance and
retirement costs. Hammersley said the district¹s insurance provider, the
Michigan Education Special Services Association, told school officials that
health insurance costs will increase 4 percent overall for the district in
2007-08. Retirement costs will increase 17.7 percent for 2007-08, the second
year in a row the district has faced a double-digit hike.

The district's main source of revenue, the non-homestead property tax, will
generate $2,853,463, up 10 percent from $2,595,478. The five-year levy of
13.39 mills is set to expire this December, and the board is looking at
setting an election to renew the non-homestead property tax measure.
Hammersley said the finance and negotiation committee is also looking at
whether the renewal request should be for the full amount, or a lesser
millage amount. With property values continuing to increase each year,
questions have been raised whether the district needs to levy the full 13.39
mills every year.

Under expenditures, the district expects to spend more next school year for
staff salaries. The overall teacher salary at the elementary school level
will increase 1.7 percent, from $305,943 to $311,265, for 2007-08. Overall
elementary spending jumps 5 percent, from $521,391 to $547,030.

Some of the biggest percentage increases are found in the secondary school
portion of the general fund. The teacher salary line leaps 25 percent, from
$367,996 to $460,088. Hammersley said most of the increase is for the new
part-time music teacher and technology positions. Overall secondary school
spending increases 21.5 percent, from $644,952 to $783,362.

Special education spending is set to increase 15.7 percent overall, from
$215,402 to $249,102. Teacher salaries are set to increase 13.5 percent,
from $96,420 to $109,455, with corresponding jumps in health insurance, from
$26,667 to $35,885, and retirement, from $25,429 to $29,443.
Superintendent Tyrus Wessell's salary would increase 1.5 percent to
$103,023, while Hammersley's salary would jump 2.5 percent, from $53,216 to
$54,547.

The operations and maintenance portion of the general fund budget drops 12
percent overall, from $527,165 to $462,734. Most of the decrease comes in
the new equipment/furniture line that falls 66 percent, from $138,400 to
$47,500.

Copies of the proposed 2007-08 budget are available at the school office and
may be viewed during office hours from 8 a.m. to 4 p.m. Monday through
Friday.

In a related matter, the board reviewed proposed amendments to the 2006-07
budget increasing revenues and expenditures.

Following is a breakdown of the proposed expenditure amendments:

- Under local funds, the earnings on investments line increases by $30,000
to $75,000. Hammersley said the district earned more on interest then
expected due to higher interest rates;

- Under state funds, the special education line jumps $48,289 to $186,789
since the state reimbursed the district for higher then anticipated costs
for the 2005-06 school year;

- Under federal funds, the Indian Education line increases to $6,989 as the
district received funds it had not applied for over the last three years.
The district also applied for and received a $30,000 "two percent" gaming
fund grant from the Grand Traverse Band for a tutoring program for tribal
students.

Corresponding increases were made in the general fund expenditures were made to offset the revenue increase.