BAXTER — The estimated $1.8 million deficit Brainerd Public Schools officials faced during budget talks last summer has decreased dramatically and could still continue to do so.
Changes in special education funding and transportation needs are two of the largest contributing factors.
School Board members approved a budget revision Monday Jan. 30, for the 2022-23 school year, with a projected deficit of $625,000 in the district’s unassigned general fund. That number represents about 0.7% of the district’s roughly $90 million yearly operating budget.
Money in the unassigned general fund is essentially the district’s rainy day fund and can be used for anything without restriction.
When board members approved the preliminary budget — which was due to the state by June 30 — they did so in lieu of more dramatic measures like staffing cuts and higher class sizes while also knowing numbers would likely change. The preliminary budget is based on numbers from last year’s budget, which projections for the upcoming year factored in, so a lot of unknowns existed at that time, including concrete enrollment numbers, food and transportation costs, state surplus funds and COVID-19 relief dollars. Revisions give the district a chance to finetune the budget with more accurate projections, Director of Business Services Marci Lord told the board Monday.
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Changes from the preliminary budget to the revised numbers include:
- A decrease of 11 adjusted pupil units from 6,006 to 5,995. Adjusted pupil units are calculated based on student attendance and weighted based on grade level. Students in seventh through 12th grades are weighted as 1.2, while younger students are weighted as 1.
- Increase in medical assistance billing and special education revenue.
- Decrease to miscellaneous revenue (interest, donations, fees, etc.).
- Updated salary and benefits with settled labor agreements and staffing changes.
- Increase in food services with the rise in food costs. The food service fund is now projected to have a deficit, but Lord said last year’s surplus from free meals will cover the difference. Meals for students were free during the past two school years but no longer are. The district’s prior reimbursement for the free meals in the wake of the pandemic was greater than the price students pay.
Special education and transportation were among two of the biggest changes. Lord said the district received an additional $625,000 in special education funding from the state than originally anticipated.
In terms of transportation, a bus driver shortage forced the district to consolidate and reroute buses, bringing the number of general education routes down from the normal 63 to 53. Lord estimates that cost savings to be about $416,000, plus another $22,000 for consolidation of special education routes. Though if the drivers were available, Lord said the district would like to bring those routes back.
... Reach out to your board members or district staff to get an accurate picture of what’s out there.
With the $625,000 deficit, the district’s unassigned general fund is projected to have just under $10.5 million in it by the end of the 2022-23 school year. That number represents about 11.3% of the district’s yearly operating budget, or roughly one month of expenses. While that total exceeds the district’s own policy of at least 10% of expenses in the unassigned fund, the state recommends 25%, or three months of operating expenses.
“The state is doing great right now, but if it ever came to where they were withholding payments from us, we want to have something in our reserve so we can continue to operate,” Lord said.
Board Chair Kevin Boyles pointed out that $10.5 million is also propped up by COVID-19 relief funds, which will run out in 2024.
“It’s not quite as rosy as it looks right at the moment, so we’re still working to get that to that magical 10% and have it be a legitimate number,” he said.
Reality of the deficit
While a deficit still stands, Boyles reminded everyone the numbers are still fluid and continue to move.
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“We’re trying to plan for the worst, and the worst usually doesn’t happen. So to that end, it was a $2.2 million swing over what we initially projected,” he said.
And though the deficit might still sound concerning to some, Boyles encouraged everyone to gather all the information before making any claims.
“When you start reading things on social media, where people are talking about $1.8 million and all these numbers are getting floated around, you have to understand this is in movement,” he said. “This is not a situation where we’ve gone out and spent $2 million we don’t have. This is us saying that if everything goes really badly, that could happen, but we’re doing everything behind the scenes to manage it on the fly. … So I caution people that are reading up on this stuff to get the most available data or reach out to your board members or district staff to get an accurate picture of what’s out there. Your neighbor probably doesn’t have the best information on how this works.”
A second revision on the budget is possible if there are significant changes in funding sources, but Lord said that is nothing she has ever had to do since being in Brainerd.
Board members will see final budget numbers for the 2022-23 school year during the district’s audit next fall but will start budgeting for the 2023-24 school year before that, using the first revision approved Monday night as a starting point.
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THERESA BOURKE may be reached at theresa.bourke@brainerddispatch.com or 218-855-5860. Follow her on Twitter at www.twitter.com/DispatchTheresa .
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