NEW LONDON — New London-Spicer Public Schools could face serious financial problems within two years, a combination of rising costs and state aid that hasn’t kept pace with inflation.
Superintendent Bill Adams and the NLS School Board presented details about the district’s situation and its needs at a public meeting in a Zoom video conference meeting Tuesday evening. Nearly 50 people joined the meeting Tuesday.
A similar meeting is planned for 6:30 p.m. Thursday. The address for the meeting is listed on the district website, nls.k12.mn.us, under “Securing Our Financial Future.”
School officials spoke about the strengths of the district and some of its needs. Adams outlined the financial challenges that could necessitate budget cuts effective with the 2021-22 school year.
Ultimately, Adams outlined three scenarios the district could follow to handle its approaching crisis.
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The district could seek to handle the problem with more than $800,000 in budget cuts that would go into effect with the 2021-22 school year. Or it could seek an operating levy to help cover costs and build up its general fund reserves. A third option is a combination of cuts and operating levy.
An operating levy is applied to property in a school district to help pay for school operations. It must be kept separate from money borrowed to build facilities.
Board chairwoman Lucinda Dahlberg began the meeting by talking about a survey that said 87 percent of NLS students feel as though their teachers care about them. While that is a great score, she said, “We never forget about that 13 percent.”
The district is proud of its academic programs and achievement scores consistently higher than state averages, Dahlberg said.
The district has excellent facilities and a top credit rating, she added.
In addition to academic achievements, the school district excels in activities and in the arts, Adams said.
“We are continuously striving to do better,” he said.
But along with the district’s accomplishments, its financial situation has caused it to put off some investments.
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The district has had to ask teachers to put off professional development training and is lagging in what he called 21st Century Expectations.
The district needs to provide technology to its students and staff. Students should have one-to-one devices, he said, and staff should have training in effective use of them.
The district also needs to develop personalized learning for all students and to create programs using 21st Century technology.
During meetings of a task force that met in May, a member questioned the need for some of the goals.
“We’re 20 years into the 21st century,” Adams said. “We can’t just continue to talk about 21st Century learning, we need the tools to do it.”
When it comes to finances, though, the district is lagging behind some others in the region, Adams said.
Costs have been rising faster than state aid has for general education, and federal and state funding does not cover the increasing costs of special education classes.
“It is a moral imperative for us to educate all students,” Adams said. As costs continue to rise, most school districts use other funds to cover special education costs. It’s called a cross-subsidy.
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Those financial issues have led to the shrinking of the district’s undesignated general fund balance, Adams said.
Adams displayed a graph showing that NLS has the lowest fund balance among all the other districts.
The district’s current has an operating levy at the maximum allowed by the state without a referendum, while many area school districts levy more.
When participants met in small groups, many people expressed surprise at the district’s financial situation.
At the end of the meeting, Dahlberg said the board would be reviewing public comments and discuss how to proceed.
If the board decides to seek an operating levy, the decision would need to be made no later than August, she said.
Dahlberg and Adams urged those who attended the Tuesday meeting to encourage others to join the Thursday meeting.
“We need as many people at these meetings as possible so we can get out community informed,” she said.
