Brainerd School Board: A better look at the budget
The Brainerd School Board Tuesday afternoon approved the first revision to the fiscal year 2017 district budget.
In an hour-long presentation to the board, Steve Lund, director of business services, outlined the changes included in the first budget revision. He also gave a brief look at the fiscal year 2018 budget, which covers the 2017-18 school year.
Highlights of the first revision include:
• An overall increase in revenues of 2.7 percent, versus the preliminary budget increase of 2.8 percent,
• An overall increase in expenses of 3.5 percent, versus the preliminary budget increase of 3.7 percent,
• An overall deficit spending level of $676,968, versus the preliminary budget deficit spending level of $1.4 million.
The first budget revision serves to clear up things which the preliminary budget assumes, Lund said. The two largest variables in the district budget, students and staff, represent the focus of the first revision of the budget. The revisions are to the general fund and community education areas of the overall budget.
The preliminary fiscal year 2017 budget included an increase in enrollment of approximately 82 more students than 2015-16. The first budget revision includes an increase of 65 students, for a projected enrollment of 6,511 students.
The district estimated ending the 2015-16 school year with 6,482 students and anticipated 6,564 students for the 2016-17 school year. The district actually ended the 2015-16 school year with 6,446 students, which is why the revised projected enrollment is 6,511 students.
Using this updated enrollment data, Lund revised the district's projected enrollment growth for the coming years. From 2015-2020, the district's enrollment is projected to grow an average of 0.54 percent per year.
"This is the future that's been rewritten based on our most recent history," Lund said.
For 2016-17, the district was budgeting for the addition of 13.5 full-time equivalent employees. In reality, the district has added 22.2 full-time equivalent employees this year. The difference comes from the addition of more educational assistants than was budgeted, as well as adding more employees in the "other" category than was budgeted. Educational assistants are added based on student needs, Lund said, and three behavioral management specialists were hired in the "other" category that weren't budgeted for.
Overall, the preliminary fiscal year 2017 budget included $77.7 million in revenue, a figure that has been revised to $78.1 million. Revenue increased by $335,007, thanks in large part to an increase in special education revenue, tuition and activities fees.
Overall, the preliminary fiscal year 2017 budget included $79.2 million in expenses, a figure that has been revised to $78.8 million. Expenses decreased by $461,215, due mostly to decreases in salaries, benefits and worker's compensation premiums.
The district typically uses the first revision of the budget as a baseline to plan the following year's budget. In this case, this budget revision will be used to plan the fiscal year 2018 budget, for the 2017-18 school year.
Looking ahead, the fiscal year 2018 will be difficult to construct, as a budget session at the state Legislature creates uncertainty for public education funding, Lund said. In addition, all nine school district labor contracts expire June 30, with a high likelihood the settlements will not be finalized before the fiscal year 2018 budget is constructed.
An early projection for the fiscal year 2018 budget includes overall revenues of $80.1 million and overall expenses of $81.5 million, for an operating deficit of about $1.4 million.
"This is just kind of a dashboard to say 'How do we plan for the year?'" Lund said. "Are some of these assumptions aggressive, are they conservative?"
Overall, the district's current budget is manageable thanks to the conservativeness he has built into it, Lund said. Moving forward, he said the district will be challenged to balance the budget, but the current position is good.
The school board's finance committee during the Monday special board meeting made a unanimous recommendation to approve the first budget revision to the full board. The full school board then approved the finance committee's recommendation on a 4-1 vote, with chair Bob Nystrom voting against the motion.
There seemed to be some confusion among the board members about the structure of the meeting. The agenda listed the meeting as a "Special School Board - Finance and Staffing Meeting," and following the meeting, Superintendent Laine Larson confirmed the meeting was a special meeting of the full school board. However, it was unclear which items on the agenda would be acted upon by the full board or by the finance and personnel committees.
Board member Chris Robinson was absent Monday.
In other business, the board:
Approved the resignation of Willie Severson, director of schools, effective June 30. Larson thanked Severson for his over 40 years of service to the district.
"Thank you, it's been a real blessing for me," Severson said.
Approved the hiring of Ashley Ingebritson, Native American and student support liaison, effective Feb. 1. The new position is for 25 hours per week at a compensation rate of $25 per hour.
Approved advertising for an additional early childhood special education, or ECSE, teacher to meet incoming student needs. There are currently 311 students receiving ECSE services in the district. This is the highest number of students receiving ECSE services the district has seen, said Julie Domino, ECSE director.