REGIONAL- The ISD 2142 school board took a major step toward charting a path through murky COVID-19 waters on Tuesday by approving a budget for 2020-21, although schools throughout the state …
REGIONAL- The ISD 2142 school board took a major step toward charting a path through murky COVID-19 waters on Tuesday by approving a budget for 2020-21, although schools throughout the state don’t yet know what school will look like when instruction resumes in September.
District Business Manager Kim Johnson reviewed her projections for the board, and a comment specifically about the food service line illustrated as well as any the conundrum she and her counterparts across the state face.
“We’re assuming school is going to happen, everybody’s going to be back, and everything’s going to be normal,” Johnson said.
With the state Department of Education telling districts to develop plans for three different scenarios while waiting until the week of July 27 to tell schools which one to implement for 2020-21, assumptions are an even more important facet of budgeting than usual. One scenario reflects the assumption Johnson mentioned, all students returning to school buildings. A second scenario is a continuation of distance learning. The third planning scenario is a hybrid model combining in-class instruction and distance learning, with limits on the number of students attending classes at any given time.
It was clear Johnson chose conservatively in her budgeting work.
“There are a lot of uncertainties because we just don’t know what’s going to happen,” Johnson said. “A good way to look at it is that it’s fully loaded. That might be the best way to talk about that right now.”
One area providing evidence of that was in calculating salaries and benefits, where there’s an automatic contingency built in.
“When I put together the adopted budget it assumes we’ve got 100 -percent employment in every position district- wide,” Johnson said. “That never happens.”
The adopted budget also was difficult to compare to the revised final budget for 2019-20 in several respects, as that revision reflected numerous items that had been significantly affected by COVID-19 and the switch to distance learning. Apparent big increases in transportation and food service for 2020-21 appeared larger than expected when compared to the revised final budget, as in both categories less money was spent when the district switched to distance learning for the final two months of the school year.
Johnson said she projected an increase of nearly $400,000 in general fund revenue. While she expects enrollment numbers to be stable, an increase in the funding formula, increase in special education state aid, increase in taconite aid, and revenue from forfeited land sales that the district didn’t receive in 2019-20 all contributed to the projected increase.
“From the revenue side I think it’s looking very, very good,” Johnson said.
However, when analyzing projected expenditures, a number of items will end up taking a bite out of the district’s fund balances.
Johnson projected a $670,000 increase in teacher salaries, based on full employment, and the cost of health insurance for all employees continues to go up.
“Just the increase in health insurance alone is $330,000 next year,” she said.
Other expenses are projected to go down, such as some utility costs and construction bond payments.
After looking at the general fund, the largest source of revenue and expenses, and five special funds for food service, community services, building, debt service, and scholarships, Johnson wrapped up her presentation with a grand total that keeps the district comfortably in the black, although some reserves will be depleted.
“In total, at the end of next year I’m projecting the 2142 fund balance is going to be $6.3 million,” she said.
The totals in the overall revised final budget for 2019-20 showed expenditures of $52.1 million and revenue of $55.6 million, leaving the overall fund balance as of June 30 at $11.6 million. With expenses projected to exceed revenues in 2020-21, that balance is projected to drop by $5.3 million, should all the assumptions Johnson factored in hold true. In the general fund portion, for example, salaries and benefits are entirely likely to cost less than projected, since that number is based on 100- percent employment.
After lengthy discussion at several prior meetings, the board came to a relatively quick decision on how to handle stipends for coaches and activity sponsors next year if their seasons are cut short or canceled.
The board approved a system in which stipends would be paid pro rata, computing a daily rate based on the stipend amount and the official length of a season as established by the Minnesota State High School League. If a season gets underway and then is canceled, head coaches would receive the daily rate for each day worked, plus three additional days for preparation work necessary before practices began. Assistant coaches would be paid just for days worked during the season. If a season is canceled before it begins, a head coach will receive three days compensation for prep work, but no additional pay. Assistant coaches will not be paid if a season never starts.
In other business, the board:
• Restored a full stipend payment for pep band directors that was included in a partial-payment motion for spring sports coaches and activity sponsors passed at the May meeting. Pep bands perform only for fall and winter sports seasons, and were not affected by school closures that restricted spring activities.
• Approved a 2020-21 pay-for-performance allocation for at-will employee wage increases, capped at a maximum of $20,000 for all positions combined.
• Assigned Sara Twedten as a .4 FTE language arts teacher at North Woods as part of a full-time position.
• Awarded a competitive propane gas bid at North Woods School to Lakes Gas for 76 cents a gallon, delivered. Ferrellgas was awarded a contract to supply propane gas to Tower-Soudan for $1.15 a gallon, delivered. Ferrellgas owns the propane tank at T-S and other suppliers declined to bid since the district does not own the tank.
• Designated Supt. Reggie Engebritson, with administrative assistant Jeanne Sopp as proxy, as the official authorities to access secured state Department of Education web-based databases.
• Authorized Engebritson to engage in discussion with area school districts regarding possible avenues for collaboration.
• Received a progress report on the construction project in Cherry.