District looks to budget reserves to erase deficit
District 833 may tap most of its reserve funds, rather than cut programs, to balance next year's budget.
The district will face an $11.7 million deficit if the School Board makes no cuts to projected spending in the 2011-12 academic year and the Minnesota Legislatures leaves aid to South Washington County Schools goes unchanged.
This year, the School Board used about $4 million of its reserve funds to cover a deficit and could cover another deficit with remaining reserves, but the unallocated rainy-day fund would go from $17 million to $5.5 million, under the budget scenario that assumes no program cuts and no loss in state aid. The district's overall budget is estimated at $156 million.
Taking a conservative look at what the Legislature might do as it faces a $6.2 billion state budget deficit, district Finance Director Aaron Bushberger told the School Board at a Jan. 6 workshop that a 3 percent cut in state aid would result in a $3 million hit to District 833. In that scenario, the district's reserves would drop to $2.6 million, leaving a difficult budget situation.
The board is discussing the general fund, which pays for education and teachers, because the staffing process for next year has begun and a decision on class sizes must be made at the Jan. 20 meeting, according to Superintendent Mark Porter, who is not recommending a change from this year.
There are other budget alternatives. If class sizes were increased by an average of one-half student, the savings would be $675,840, according to Bushberger.
Board members Ron Kath and Jim Gelbmann said they would vote for no change in class sizes.