By Ryan Gueningsman
DELANO, MN Delano School Board approved a budget for fiscal year 2010-11 that has a general fund deficit of $468,124 at the board’s meeting last Monday night.
It was noted this deficit will be covered by reserve funds.
The district has maintained a healthy fund balance the past years due to increasing enrollment and conservative fiscal management, according to Superintendent Dr. John Sweet.
“We are now experiencing an enrollment decline as new residents to the district are limited due to the slowing of the housing market,” Sweet said.
It is expected enrollment will decline by at least 17 students, to 2,270 from 2,287, which will have a negative bearing on revenues. Despite this decrease in enrollment, the board noted its buildings would still all be over capacity.
The approved budget was also based on the assumption that general education revenue will remain constant at $5,124 per pupil unit, as school districts are not receiving any increase in general education revenues.
Sweet also noted the voter-approved referendum revenue is $431.11 per pupil unit. This referendum will expire at the end of the 2011-12 school year. This will need to be renewed, and likely increased, in November 2011.
The federal stimulus initiative brings $243,620 into the budget, which will be the last year for this funding.
Another factor for the budget is that the school district has a number of employee contracts that are not yet settled, which will likely increase the deficit.
Sweet also said that, to balance the state’s budget, the Minnesota Legislature has implemented a policy of payment shifts and delays in aid payments as methods to manage the state’s cash flow.
Under the worst-case scenarios that the district has reviewed, it is possible the district would need to borrow for cash flow purposes forward the end of fiscal year 2011, Sweet said, adding that much thought and study will need to be given to proceeding with the next budget cycle.
The district is looking at a total budget of all funds at $25,099,390 for income, and $26,336,649 for expenses.
More from the Delano School Board meeting will appear in next week’s Delano Herald Journal.