What is the fund balance? Why do we need it?

Post date: Jul 20, 2013 7:15:18 PM

The school bond funding pays for construction costs and supplements operational capital costs so that the district's General Fund balance can serve its intended purposes:

• • Keep the district from going into default through the year as it waits for ad valorem tax receipts to arrive

  • Allow it to temporarily endure deficit budgeting to preserve class sizes and program quality

  • Have a cushion against repeated state funding cuts and other unexpected funding losses or cost increases

School finances are quite complicated, but they break down into several major funds, including the General Fund (which pays for most costs, including personnel), the Building Fund (which pays for some of the cost of building maintenance), and the Sinking Fund (which consists of bond issue money used for capital costs).

A healthy balance in the General Fund is what allows the district to temporarily budget at a projected net loss without risking default. This means more staff can be retained and district salaries, which are already far below the peer average, can be kept from falling further behind. Thus class sizes are maintained, quality staff can be retained, and the end result has been high student achievement despite ever-increasing local poverty levels and shrinking state funding.

The current budget for 2013-2014 is projected to reduce the General Fund balance because it places a priority on student learning by funding additional reading teachers for the elementary schools and funding for other programs despite a lack of sufficient state funding to address those needs. Without a healthy fund balance the district could not provide those resources, and their continuation will depend on additional funding from the state in future years.

Bartlesville's annual funding through the State Aid Formula has declined by 17%, over $3,000,000, from what it was in 2008-2009:

State Aid Funding Formula Money for the Bartlesville Public Schools