Based on current state funding and budget projections, the school district will need to cut $10 million from its operating budget and draw $5.6 million from its fund balance over the next four years to develop a balanced budget. This is on top of nearly $10 million in cuts during the past decade.
“State funding has not kept pace with inflation or increasing costs for more than 15 years, and we have never been fully reimbursed for our required special education services,” said DeeDee Kahring, Director of Finance and Operations. “We have done our best to keep cuts away from the classroom, but that has become increasingly difficult. Even though we are a growing district, expenses continue to outpace revenue and strain our operating budget.”
Anticipated cuts that would be required without additional revenue include items such as class size increases and moving from a seven-period day to a six-period day at the middle and high schools. The proposals include bringing the district fund balance down to 5.5%, which is at the low end of the district’s policy and prudent financial practice. Fund balances are an important cash flow tool, providing a cushion against unexpected expenses and inadequate revenue. To put that in context, a 5% fund balance would cover district expenses for less than a month.
The School Board previewed the cut proposals at its April 22 meeting. The legislature is scheduled to adjourn May 20, providing the district with answers to what state funding it can expect for 2019-20 and 2020-21.
The administration and School Board will continue to review various financial scenarios to make final budget cut decisions and determine what additional funding is needed from residents in order to present a longer-term balanced budget.
Even if the district receives additional funding from the state and the community approves an operating levy increase in November, it will help – but it is not likely to solve all the financial challenges.
Learn more about the district’s budget pressures at http://www.district112.org/needs/.