6/6/2022 4:33:00 PM North Branch early budget numbers
based on growing enrollment; for a change
The Minnesota legislative session ended in May with stacks of un-finished business and any special session date is still pending. The situation leaves North Branch School Board members taking an early look at next year’s budget, realistically basing decisions thus far on a known two percent aid increase. The two percent was in the biennium budget enacted by state legislators last year.
Director of Finance and Human Resources Dr. Todd Tetzlaff advised the North Branch School Board members last week, the district is not immune from inflation. As with people’s lives everywhere; inflation is a factor in nearly everything the district’s involved in— food, transportation, energy costs, supplies and more.
Setting school district budgets is a year round process, Tetzlaff added, with the audit from last year due in October and numbers crunching underway with the end of the school year June 31.
The 2023 budget year starts July 1, 2022.
State law requires school districts to adopt their coming year preliminary budget by end of June, so Board members were “unpacking” some of the bigger data last week. The Board meeting in mid-June will be when the numbers are finalized and the vote happens. Lunch prices and fees will be set and long term facility maintenance plans get submitted to the state.
The positive side of the equation in North Branch is that enrollment is finally on the upswing, Tetzlaff stressed.
Grade levels are projected to grow by 4.7 percent. All groupings are experiencing growth in numbers: incoming kindergarteners are at 171. Kindergarteners went from 151 to 167 in first grade, with increases through to 12th grade now projected to be 281 at year’s end and enrollment was 244 last year.
North Branch K-12 population is at 119 additional pupils from 2020-2021 or a current 2,368 students.
Pandemic-related aid from federal sources will be less than what school districts got in the two prior years, but still is estimated over $1 million.
There has been no final decision yet on continued free lunch programs.
Tetzlaff said the district is “getting mixed messages” on this and last week he was not certain on funds next year. Tetzlaff was happy to point out that Community Education revenue is back, “...revenue has caught up” with what were pre-covid shutdown numbers.
And, then there’s the “cross subsidy” issue. One of those costly but unresolved issues facing lawmakers; North Branch has reported local money is covering about $3 million in special education expenses annually and the special ed act mandate was never meant to be a localized burden. There was discussion about the state chipping in (the number mentioned in St Paul was covering 40 percent of the gap) to lessen district local shortfalls, but this issue wasn’t finalized.
Board member Adam Trampe asked if using a two percent state aid growth is realistic for budgeting and Tetzlaff said that’s the reliable number the district has, right now. “We work with what we know.”
The end of this year is projected to come in with a general fund balance of about seven percent, which will be below the North Branch School Board’s low end goal. The spend down is estimated at $975,000. Last year’s balance was 11 percent.