District plans recovery from nearly $300K hit to savings

In the past, we’ve always thought conservatively with our utility numbers. Unfortunately, this year, it wasn’t enough— Amy Christman, Business Manager, Allegan Public Schools

After winter weather brutalized last year’s Allegan Public Schools budget, this year will begin what administrators hope is the first of a two-year recovery of the district’s general reserves.

In June, district business manager Amy Christman said costs for utilities and snow plowing rose by more than $250,000 for the 2013-14 budget.

Unforeseen enrollment losses helped worsen the total hit to the district’s reserves to an estimated $297,375.

That dropped the district’s reserves—its general fund balance—to an estimated $1.95 million as of June 30. That number will be finalized with the annual financial audit later this summer, but it still amounts to leaving the district’s general fund at 8.4 percent of expenditures—below the 10 to 15 percent generally favored by most districts in the county.

Christman said, “In the past, we’ve always thought conservatively with our utility numbers. Unfortunately, this year, it wasn’t enough.”

Current year

School board members passed the district’s initial 2014-15 budget June 23, and it projects adding—instead of subtracting—to the general fund balance by an estimated $172,702.

Superintendent Kevin Harness said, “The goal over the next two years is to get the fund equity—to replace what was lost over the next two years.”

If that holds up, the district will end with a projected $2.1 million fund equity, or 9.1 percent.

The 2014-15 budget is able to do that with approximately the same amount of expenditures. The district is boosting the utilities and snow removal budgets;

Christman said, “Otherwise everything is kind of status quo.”

Enrollment

Besides Michigan’s weather, enrollment is, as ever, the remaining unresolved factor in the district’s budget.

Last year, the district’s state funding was based on an enrollment of 2,616 full-time equivalent students. That represented a drop of 46.5 students from funding in 2012-13.

This year’s budget projects a final loss of 16 students.

Christman said that was based largely on a study the district funded as part of its application to the state to borrow the money for its recent renovation project.

Fortunately for the district, state school funding increased.

“It’s a welcome increase, but it still does not get us to equal funding levels five years ago,” Harness said. “But it is a welcome change from flat or no increases.”

For full story, pick up a copy of the July 31 issue of The Allegan County News or subscribe to the e-edition.

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