The district’s total budget includes the general fund, which amounts to approximately $147 million, food service, community service, building construction, debt service, internal service fund and the trust fund.
About 78 percent of the general fund expenses go to wages and employee benefits and 14 percent goes to purchased services, such as utilities and transportation.
This current legislation appropriated a 2 percent increase in state aid for the general education formula allowance each year for the 2019-20 and 2020-21 school years. A cap on the special education cross subsidy funding amounted to $950,000 for the district this year and $1.25 million for 2020-21 school year.
This state funding along with additional funds from the passage of the November 2017 operating referendum levy enabled the district to maintain quality programs and not have to make significant budget adjustments for the 2019-20 school year.
Executive Director of Business Services Bill Holmgren reported other budget assumptions include a continued enrollment increase of 1.6 percent estimating 11,408 students for the 2019-20 school year. A steady enrollment increase is projected over the next five years.
As in past years, the approved budget is consistent with the Board of Education’s requirement to maintain a fund balance of at least 5 percent of current year budgeted expenditures. The fund balance for the 2019-20 school year is 9 percent, down from an estimated 11 percent from fiscal year 2018-19.
At the meeting, Director Bob Erickson noted the 2019-20 budget is consistent with the district’s long-range financial plan, which forecasts out anticipated activities and outlook over the next five years.
“The board adopted long-range plan has led to our current meaningful fund balance,” Erickson said. “While other adjoining districts are struggling with their fund balances and looking to make significant cuts, we are not in that position at this time in large measure due to the long-range financial plan.”
Superintendent Michael Baumann said, “The state aid for the biennium was lower than anticipated and the slow downward trend in fund balance gives me concern. The district has done very well with fiscal management and optimizing assets, but our needs continue to grow. We have school safety improvement needs that include mental health support requirements; enrollment growth is adversely impacting class sizes— especially in our middle schools; and information technology demands are outpacing our resources. These concerns are directly focused on our students and must be addressed so we can sustain high performing outcomes. To that end, I am working with the Board of Education to assess the potential for an operating levy in November.”
Lakeville Area community members are encouraged to review the 2019-20 preliminary budget book, which is available on the district’s website.