District defends reserve levels
The St. Joseph School District has a little more money in the bank than other districts across the state, according to a preliminary audit last week. School officials said that keeps the district from having to ask for an increase above the current 63-cent levy next April.
“The plan is probably if we can renew the 63-cent levy, we can start to use some of the reserves which would allow us to make that 63 cents last longer,” said Janet Pullen, St. Joseph School District chief financial officer. “It would be a longer period of time before we had to go to voters and ask for an increase.”
In a preliminary report to school board members in a workshop meeting last week, Richard Westbrook of the Westbrook and Co. audit firm said the St. Joseph School District reserve fund is at about 29 percent of its annual budget. That’s roughly $32 million in the bank out of $114 million budgeted for next year.
“He said we may be on the high side of average,” Ms. Pullen said. “He has districts that have maybe 40 to 50 percent. There’s a whole range. He said we’re healthy but probably not excessive on the other hand.”
By using a portion of those reserves each year, it enables the district to operate on the current 63 percent rate for a few more years, Ms. Pullen added.
The original levy, which was passed in 2004, had a sunshine clause that will end in 2009. The hope back then was that the state revenue streams would increase so voters would not have to renew the levy. But that didn’t happen. The state changed its funding formula shortly after the levy was passed.
Ms. Pullen said renewing the 63-cent levy, plus using a portion of the reserves each year, will help keep the district at current operating levels. If it doesn’t pass, the reserves would run out quickly and not cover the school budget. “I say we’d be broke in two years,” Ms. Pullen said. “Our reserves are not large enough to take that 63 cents out of our revenue stream.”
The St. Joseph School District gets 50 percent of its funding from local money, 38 percent from the state and 11 percent from federal coffers.
Alonzo Weston can be reached
at alonzow@npgco.com.
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