Budget cuts help ACGC work out of its debt

GROVE CITY -- An audit report of the Atwater-Cosmos-Grove City School District shows that budget cuts implemented this year are helping the district inch its way out of statutory operating debt.

The report, which was presented Monday, showed the general fund ended the 2005-06 school year with a negative balance of $340,397. The original balance predicted a negative balance of $623,607.

The reduction in the level of deficit spending was due to more than $420,000 in budget cuts, and that helped the district "have less of a negative balance than we projected," said Superintendent Pamela Kyllingstad.

"We're going in the right direction," said Kyllingstad. "The fact that we reduced the amount of deficit from the last year -- that is significant."

The district was praised by the auditor for making "inroads in our deficit" by being "cautious in our fiscal dealings."

Statutory operating debt means the amount of money the district has in its net unreserved general fund is not enough to meet state financial standards.

The school board was told that the district needs to have $642,294 in its general fund reserve in order to meet state standards for getting out of statutory operating debt. "That's the amount we need to pay back," said Kyllingstad. The district has three years to get out of statutory operating debt, which would be in the 2007-08 school year.

The school board intends to make that happen by implementing additional budget cuts next year. It's also banking on voters approving an operating levy Nov. 7 that would raise an additional $380,000 a year for seven years.

If the levy is approved, Kyllingstad said the board's "first duty" would be to use the new money to "erase" the statutory operating debt. It would not be used to restore budget cuts that are in place this year.

Those cuts included reductions in teachers and realignment of staff, including Kyllingstad, who is now doing double-duty as the elementary principal at North Elementary in Atwater.

David Oehrlein, who teaches fifth- and sixth-grade language arts at South Elementary in Cosmos, is also doing double-duty as the principal at that school.

In other action Monday:

- The board approved a resolution to refinance the district's building bond, which will reduce the levy needed for the building bonds.

- The board hired Valerie Carlson as the school nurse.

- A special meeting has been set for Nov. 9 to ratify the Nov. 7 election returns.