Brainerd School Board: School still operating with deficit spending
Brainerd Public Schools slightly shrunk its deficit for the 2017 fiscal year budget--but the district is still left with more than a million dollars of operating in the red.
Brainerd Public Schools slightly shrunk its deficit for the 2017 fiscal year budget-but the district is still left with more than a million dollars of operating in the red.
The Brainerd School Board met in a special school board meeting Monday and approved a revision to the 2017 fiscal year budget for the 2016-17 school year, which resulted in lowering the deficit by $610,858. The last time the school board revised its budget was in January. January's revision showed an estimated $1.7 million deficit for the school district and April's revision decreased it to an estimated $1.1 million deficit at the end of the fiscal year, which is June 30.
With this updated revision, the district will end its 2017 fiscal year with an estimated $94.9 million in revenue and $96 million in expenditures.
The district's finances are split up in several different funds, including a general fund-which is the biggest fund-and then funds for food service, community education and debt service. By June 30, with the approved revisions, the district will have a $671,865 deficit in the general fund; $140,797 more in revenue than expenditures in the food service fund; a $19,773 deficit in the community education fund; and $226,665 in the black for the debt service fund.
A big chunk of the deficit comes in the district's "other post employment benefits trust fund," which shows an $831,333 deficit. The district also has an "other post employment debt service fund," which is projected to be $41,411 in the black.
The budget revisions by fund approved were:
• $5,103 was added to the general fund. The district lost $111,007 in revenue, but spent $116,110 less. Changes include the district paying $30,000 more in custodial overtime; paying $52,100 less in salaries, as there was a miscalculation with a salary; a $100,000 adjustment to 4A grant; $11,000 in correcting athletic fees early on in the year.
• $38,000 less in the food service fund, which was due to paying less in a salary.
• $275 in less revenue in the community education fund. The district received less revenue in the Balance Pathway II program.
• $200,000 was transported from the construction fund to the debt service fund.
• $368,070 was added to the other post employment benefits trust fund as interest was increased.
Steve Lund, the district's director of business services, said the administration team now will be working hard on the 2018 fiscal budget trying to close the deficit gap between revenue and expenditures.
"We're hoping to take a conservative approach to start our fiscal year," Lund said. "We have a lot of planning work to do. ... We have had higher claims this year. ... We know we have to be very cautious when looking at budget adjustments. We will try to bring a preliminary budget in late May."
Lund told the board to keep in mind there is a lot of uncertainty to the budget as the district has its labor agreements open and the state is still working on its state aid to school districts.
Lund said there are different ways to close the deficit gap, but hope their "realistic assumptions" on what the staffing expenses end up being when the labor agreement contracts are settled, what enrollment will be and what the district will receive from the state will all help with reducing expenditures.
"We have challenges we will be facing," Lund said in closing the gap. "It hasn't been uncommon for us to start a fiscal year with a slight deficit."