I hope all is well and you are having a great winter season. This is the time of year when the school district uses the information from the December audit to start the budgeting process for the next year.
The Director of Finance and I are determining the parameters for next year's preliminary budget to help with staffing planning. We will bring our forecasting information to the school board for discussion. Each year that we are in statutory operating debt (SOD), we need to submit a plan to the Minnesota Department of Education that details our plan for maintaining a balanced budget and how we plan on getting out of SOD. The plan for the upcoming school year was recently approved by the school board and submitted to the state.
This recovery plan outlines projections and assumptions around a number of variables in the financial management process, including student enrollment revenues, staffing, expenditures and contingency budgeting.
Currently, our negative fund balance is $6.4 million. As we have been sharing with the community over the past year, much of that is largely driven by a shortfall from the state in special education funding. It’s known as the cross subsidy -- general education funds that need to be used to pay for mandated special education programming. Changes in the special education funding formula made in 2016 lagged for two years and the new funding amount could not have been predicted.
This shortage of funding happened at the same time we had chosen to spend down the fund balance before going out for an operating levy. Even though this allowed us to sustain our great academic programming we have for students, it made us vulnerable to the possibility of going into SOD. When it was uncovered (2 years down the road) that we were not going to be reimbursed from the state by as much as we had planned, our fund balance went into a negative two year trend.
We have made the needed adjustments to have a balanced budget moving forward, but we will need to pay off our negative fund balance and that is described in the SOD plan submitted to the state. More information about the cross-subsidy and going into SOD can be found on our website at this link.
Governor Tim Walz has assembled a task force to look at the cross subsidy issue and I have made many trips to the Capitol and plan to make many more this legislative session. I have been asked to testify to the Governor’s task force to help explain the negative consequences of the new special education funding formula.
We remain hopeful that our lawmakers are hearing us and will decide to make the special education funding formula more equitable. It is our plan to continue the great academic programming we have at ONE10 throughout this SOD journey and we appreciate all the staff and community support as we move forward. This has been a strong WEareONE10 moment.
DeRusha Eats visits Cafe 110
WCCO-TV’s Jason DeRusha came to Waconia High School to check out Cafe 110 for his “DeRusha Eats” segment. He toured the kitchen with our nutritional services director, Barb Schank, and then sat down to have lunch with students. Jason seemed super impressed with what we are doing in Cafe 110, commenting, “This feels more like a bistro than a school lunch line.” He also mentioned “how nice and respectful” all the kids were to him. That’s ONE10! The story is scheduled to air on Thursday of next week. After that, it’ll be online so, if you miss it, we will share the link after the story is posted.