Majority says to stay the course despite last year’s growth spurt
by Jim Boyle
The Elk River Area School Board decided to stay the course with its plans to cut $2.75 million in expenses from its 2014-15 school budget.
Current projections show a $775,335 surplus in revenue over expenditures and its fund balance growing from $8.6 million to $9.3 million.
That’s above the 5 percent of the budget threshold in fund balance per board policy but below the 8-12 percent fund balance financial advisers ask the district to pursue to command the best possible interest rates when the school district sells bonds.
Several things give School Board members pause, starting with unfinished contract talks with all of the bargaining groups and modest enrollment projections that not all board members are ready to buy.
The Elk River Area School District projects it will bring in $109.6 million dollars for the coming school year, and it has $108.8 million on the books so far. That includes roll-up costs from steps and lane changes for longevity, but no money for increases to salaries or benefits. The district cut $2.8 million in expenses from the 2013-14 school budget, and the projection is to have to cut another $1.8 million next year.
A surprise growth spurt this past year has helped improve the district’s budget outlook for the 2014-15 school year. There has even been growth in enrollment during the first month of 2014, a month that usually brings about a slight decrease in the number of students.
“Twenty-five to 45 students probably left, and we still grew by 80-plus students,” said Greg Hein, the school district’s director of business services. “Something’s going on.”
District 728 grew by about 350 students from last school year to the start of this year, and district officials are projecting to grow by 135 students next year and two years following that.
“We’re projecting growth now, but we weren’t able to project it last year,” a puzzled School Board Director Dan Hunt noted.
School Board Director Shane Steinbrecher asked that the district survey the new people coming into the district to see what circumstances brought them here. “Are we giving this task to Joe (Stangler) to survey and find out what’s going on?” Steinbrecher asked.
Hein said he loves that idea.
“I’d like to have more answers before we have these as our assumptions,” Steinbrecher said. “I’m not one to jump on the bandwagon that we’re going to grow this fast. It’s hard for me to bite. I might as well throw a dart at a board right now.”
Hein reiterated he is comfortable with a modest assumption of growth for this coming year based on what’s happening currently.
“We’re going to start building the 2014-15 budget, and we’re going to start staffing,” he said. “We need to have the board weigh in on whether they’re comfortable with this set of assumptions and what the cut level should be.”
The majority said to stay the course with plans to cut $2.75 million. School Board Director Jolene Jorgensen noted the district has a fund balance of greater than 5 percent of the entire budget, which is what board policy requires. She was willing to look at scaling back the volume of cuts.
Steinbrecher, Hunt and Tony Wallter were not. School Board Chairwoman Jane Bunting and School Board Director Sue Farber were not in attendance. Vice-chairwoman Holly Thompson, serving as the chairwoman for the meeting, said she would like to stay the course, knowing the board can always scale back at the last hour as more information comes in.
“It would be really difficult to say go back and cut more,” she said. “We can always pull back.”
Superintendent Mark Bezek also recommended sticking to the game plan and taking a conservative approach. District 728 administrators began sharing the school district’s budget picture at a series of public meetings this week. One was held in Rogers and a second was held in Elk River. A third is planned for 7 p.m. Feb. 19 at the Zimmerman Elementary cafeteria.
One of the things Hein said he is trying to impress upon staff and community members is the school district only has control over certain aspects of the budget. There are often strings attached to parts of the budget. For instance, someone might suggest cutting an integration teacher, but that part of the budget is restricted. To cut this particular position would only throw money away. It wouldn’t add funds to the general fund.
“It wouldn’t do anything to help the discretionary budget,” Hein said.
Restricted revenues include ones for staff development, health and safety, gifted and talented, operating capital, integration, basic skills, safe schools and federal grants as well as food service, community education and debt service.
Unreserved, undesignated expenditures that could be altered include salaries for teachers, principals and administrators as well as salaries for custodians, clerks, substitute teachers and assorted benefits. The district also has discretion over transportation, professional services, operations and maintenance, repairs and maintenance, electricity and fuel, textbooks, supplies, equipment, dues, licenses and memberships.
Tentative budget timeline
• Gather staff and community input through Feb. 19.
(Three public meetings were set to discuss the budget. Two were Feb. 5 and 6 at Rogers Middle School and Twin Lakes Elementary, respectively. The third and final meeting will be at 7 p.m. Feb. 19 in the Zimmerman Elementary cafeteria.)
• Survey – open through Feb. 14.
• Proposed budget reductions – late February or early March.
• Board approval of budget reductions – end of March.
• Update detail budgets – April and May.
• Final board approval of ‘14-’15 budget – June