District Finances-Responsibility, Diligence, and Accountability.
A quality education cannot happen without the procurement of resources. Fiscal responsibility is a necessity to ensure current and future academic successes. It is my goal to diligently and responsibly manage taxpayer dollars to ensure that our students get a high quality education.
Accountability- As Superintendent, I am accountable to the school board for both the fiscal condition of the school district and the management of resources. All non-budgeted expenditures over $10,000 must be approved by the school board in an open meeting. All district expenditures are reviewed by the board at the monthly school board meetings.
Overall Budget (Projected):
Fund Balances as of June 30, 2013:
Committed: 600,000 (This is designated for a future roof over the 2000 addition)
Current Fiscal Status of District:
The Underwood School District is currently in a strong financial position. The primary reason for our current fiscal health is our increasing student numbers combined with the boards focus on wise fiscal management. We have sought to pay off long term debt, increase efficiency of our building through energy conservation measures, and constant review of current expenditures. At this point we have a structurally balanced budget.
Steps that have been taken to reduce expenditures:
1) Off Peak Boiler Installation, estimated 40,000 per year savings by converting away from expensive fuel oil.
2) Payoff of a Bus Loan: saved about 3,000 in interest and reduced expenditure budget by 17,000 per year.
3) Payoff of a ESG loan for facility improvement: saved 62,000 in interest and reduced our expenditures budget by about 30,000 each year.
4) Review of contracts, bills, and other expenses for efficiency and cost mitigation. Group purchasing for reduced pricing.
Who pays for Underwood School?
Underwood School District is funded through Federal, State, and Local dollars. In FY10, only about 12.54% of the budget was from property taxes. In other words, for each dollar that Underwood receives, 12 1/2 cents come from local property taxes.
When is the school fiscal year?
The school fiscal year runs from July 1st through June 30th.
What are the school fund categories?
There are four fund categories that schools utilize: General Fund, Food Service Fund, Community Service Fund, and Debt Service Fund.
The General Fund is the primary fund that is utilized for the day to day expenditures of the school.
The Food Service Fund is used to finance the hot lunch program and cannot be used for general education expenses.
The Community Service Fund is used to finance all community education activities such as summer recreation activities, ECFE, and various other programs that involve the community.
Debt Service Fund is the fund used to pay off the 2001 addition to the building.
What is the Shift?
The state of Minnesota allocates dollars based on student enrollment each year. Originally the state would pay the district 90% of the dollars in one year and the additional 10% the following year. In FY10, the state gave schools 73% of the allocation and the remaining 27% would be paid the next year. In FY11, we received the 27% from FY10 and 70% for FY11 with the promise that we would receive 30% in FY12. For FY12, the school will receive 30% from FY11 and 60% for this current year with the promise to pay 40% in FY13. Midway through FY13 the state aid shift went to 64% and then 84%. For the remainder of the year we will be paid on an 84% shift which only leaves us waiting for the additional 16% for next year. This change has significantly helped our cash flow situation and allows the district to do more investing to ensure maximum returns on school reserves.
How does the shift affect our school?
The major issue with the shift is cash flow as technically the district receives the same amount of money just in different years. The reason that it affects cash flow is that IOU's for next year don't pay bills for this year. To date, Underwood has been able to cash flow without borrowing due to the Reserves that have been built up through conservative spending and wise financial management by the school board. This year I was fully expecting to have to borrow to maintain cash flow due to this shift as well as a provision in the law that allowed the state to withhold metered payments within a fiscal year; however, the law that allowed withholding of payments was repealed. These changes have allowed us to cash flow using reserves to this point.
The bottom line is that we will do the best job possible with the resources available. The board and myself do not take lightly that we are stewards of public dollars. These dollars are collected from hard working people to promote a better tomorrow for our children. Ensuring that these dollars are managed in a responsible and efficient manner is of huge importance. We will do our best to ensure that your dollars are spent wisely.