By Ryan Gueningsman
DELANO, MN An overview of the upcoming operating levy was the main focus of this year’s state of the schools address, hosted by the Delano Area Chamber of Commerce Sept. 15 at the Delano City Hall.
The present voter-approved operating levy of $426 per student will expire at the end of the 2012-13 school year, according to presenter Superintendent Dr. John Sweet.
Delano, along with districts across the state, is reliant on a voter-approved levy to fund the normal educational programs and operations of the district.
Sweet said the district voters determine the level of educational programming desired through the operating levy. He said 133 school districts out of the 340 across the state will be at the polls this election.
“What we’re trying to do here is just maintain operations,” Sweet said, noting that it is not designed to lower class sizes or add programs.
When analyzing Delano School District’s financial position, Sweet said, the sooner the levy is approved, the better, which will lower future budget reductions.
“The sooner we get the revenue into the stream, the better, because even with that, you could be looking at budgetary reductions down the road,” he said. “We have been able to avoid cash flow borrowing during these difficult financial times due to good financial stewardship. That’s very important to us to try to avoid that.”
There was no increase in state funding the last biennium, and Sweet said there is a very small increase this year.
“Most school districts are faced with cash flow problems,” Sweet said. “The legislature surprised us a little bit, and they gave a $50 per student increase in anticipation that school districts will be into cash flow borrowing because they’re shifting 40 percent of the payments we’re supposed to receive this year into next year. We have to cash flow about $5.6 million in shifted revenue this year, and we have the fund balance to do that this year.”
For Delano, this additional $50 per student will add up to about $138,000, Sweet noted.
Sweet said the average state operating levy for 2012 will be $1,055. Delano is presently at $426, and is seeking to increase that amount to $990.
Sweet said the increase would raise taxes $124 per $100,000 of tax value, or about $10.33 per month. With the average property tax value of the district being about $238,000, this would be about $24 more per month.
“Even with this, given the assumptions we are operating under, we could still be looking at a $496,00 shortfall,” Sweet said.
Assumptions include the flat state funding, federal stimulus funds that expire, and this year’s budgeted deficit of $785,000. He also said there is no enrollment increase projected, and said spending increases are projected at about 1.32 percent per year.
It is the goal of the school board to maintain a 9 percent fund balance to avoid cash-flow borrowing and the interest expenses that come with borrowing.
Sweet said the present school taxes actually have decreased about 9.74 percent due to the refunding of some bonds.
“We refunded those and paid those off early,” Sweet explained. He said this resulted in a tax decrease across the district of about $45 per $100,000 of tax value.
Sweet also discussed a literacy incentive grant initiated by the legislature, and said Delano stands to receive an additional $38,000 from this.
Some common questions Sweet said he has received to- date revolve around “doubling” the operating levy. He said it is being doubled, but that does not mean taxes will be doubled.
He also reviewed projections if the district voters agreed to only renew the existing levy.
Eventually, Sweet said, this would lead to Delano falling into statutory operating debt, which means the district’s fund balance falls 2.5 percent below expenditures. He said difficult cuts would also need to be made.
He said pending infrastructure improvements, such as roof work, are also sitting out there, and said technology is also continually changing. He also discussed funding inequities within the state, which creates opportunity gaps for students across the state. He said an equalization factor is needed.
Sweet said Delano students consistently perform well on all measures of achievement, while the district operates in a cost-efficient manner.
In the last testing period, Delano had a composite ACT score of 24.2, while the state average was 22.7, which is also the highest in the nation.
For 2010 math tests, Delano showed an 84 percent proficiency rate, while the state average is at 66 percent. For reading tests, Delano showed an 85 percent proficiency rate, while the state average is 72 percent.
Sweet showed that, while the per pupil costs were lower than some neighboring districts, test scores in 2010 remained the same or better than neighboring districts.
“One of our neighbors is exceeding us just a little bit there in reading, but the point we keep driving home is we’re getting this done at a cost per student well below our neighbors, especially our neighbors to the east,” Sweet said.
Sweet reviewed class size projections for the 2011-12 school year, updated as of Aug. 22.
Class sizes are:
First grade 20
Second grade 25
Third grade 25
Fourth grade 25
Fifth grade 25
Sixth grade 24
Seventh-eighth grades 25 (math, language arts, science, social studies)
Ninth-12th grades 25 (math, language arts, science, social studies).
“Our buildings are full,” Sweet said. Present enrollment is 2,284 students.
Vote for MEE (Maintaining Educational Excellence)
Sweet said a volunteer group has been formed called Vote for MEE (Maintaining Educational Excellence), and played a jingle that had been created by several Delano students.
A link to the Vote for MEE website can be found from the Delano Herald Journal homepage.