WILLMAR - The Willmar Public Schools are still financially strong, but recent efforts to improve instruction are affecting its general fund reserves.
Projections indicate that the district could see its unassigned fund balance begin to shrink in the next year.
The Willmar School Board adopted a budget for the 2014-15 school year at its meeting this week. Business and Finance Director Pam Harrington explained the budget and how recent law changes have affected it.
The budget includes projected revenue of $47 million in the general fund and nearly $50 million in expenditures. Money from the general fund reserve will make up some of the difference.
The state requires that school boards adopt budgets before the next fiscal year begins on July 1. However, information about some federal and state funding won’t be available until later in the year, and so the original budget contains preliminary numbers, Harrington said.
For example, the district has applied for a School Improvement Grant for Kennedy Elementary School. The school has had grants the past two years and is hoping to receive another grant for its third and final year of eligibility.
Recent actions in the state Legislature have affected the look of the budget, too, Harrington said.
The state increased funding to pay for all-day, everyday kindergarten, which the district has provided at its own cost for nearly a decade. The state added funding for the basic per-pupil funding formula and adjusted funding in other areas.
All districts in the state received some one-time assistance to implement a new teacher evaluation system.
Tuition billing for special education services has been changing each year, leading to a new system that goes into effect for the 2015-16 school year.
Changes in the West Central Integration Collaborative will change the district budget, too. School success coordinators and cultural liaisons will now be school district employees, rather than employees of the collaborative. That is reflected in increased revenue for the district and a corresponding increase in expenses.
Enrollment has been fairly steady since 2006, with the average daily enrollment hovering around 4,050 students. Enrollment shot up more than 100 students a year ago. “We were hoping it was going to stay up there,” Harrington said, but it appears to have been an anomaly. Much state aid is based on enrollment.
The district has a policy of maintaining an unassigned balance of at least 6 percent of annual general fund expenses. The district has had more than that for some time, but the fund balance could be approaching the 6 percent level.
The 6 percent level, equal to about three weeks’ expenditures, is a good level for the district, she said, though some people may question it. Auditors sometimes suggest reserves of 10 percent or more. Willmar’s balance has been higher than that at times, and in the last few years some deficit spending has reduced it.
“We have done some amazing things” for kids in the district, she said, but the deficit spending can’t continue indefinitely. It’s possible budget cuts could be needed before the 2015-16 school year, she said.
“We’re not a bank,” Harrington said. “We want to use our money to benefit students.” The 6 percent balance is enough to maintain cash flow and help the district weather enrollment changes throughout the year.
The Food Service Department projects $2.9 million in revenue and expects expenditures of about the same amount. The district does not plan to increase meal prices in the coming year.
The Community Education Department projects revenue of $2.8 million and expenditures of $2.9 million.
The debt service budget will be eliminated in the coming year, as final payment is made on the Willmar Senior High construction. Any remaining balance in that account will be returned to taxpayers through lower taxes next year.
In other business, the board approved minor changes to student handbooks in the district. Some of the changes had to do with changing state graduation requirements and also changes in the district’s school lunch policy.
The board adopted resolutions calling a School Board election for this fall and setting filing dates of July 29 through Aug. 12.
