Cliff Buchan
News Editor

A budget calling for $60.1 million in total general fund expenditures in ISD 831 for the 2005-2006 school year is now on the books.

Action came last Thursday during the June business meeting of the school board. But donít think the boardís work with the budget is over.

Far from it.

Once the Minnesota Legislature concludes its business in St. Paul, the budget for next year will likely need modification to reflect new levels of basic state aid. When that happens, however, is a mystery as the end date for the current special session in St. Paul is unknown.

Faced by a June 30 deadline to have its budget in place, the school board voted 7-0 on June 2 to adopt the spending for the school year that opens July 1.

When all funds are factored, total school spending in 2005-2006 will be $71.4 million compared to $70.7 million in the 2004-2005 school year.

Community services (community education) spending is set at $2.7 million while food service spending will reach $3.3 million. Debt service spending in the upcoming fiscal year will be $4.26 million.

The approved general fund budget compares to total expenditures of $60.4 million in the 2004-2005 year and $59.7 million in the 2003-2004 school year.

The amount approved last week includes a $2 million budget modification plan approved by the school board this spring. That plan incorporates $1.5 million in general fund spending cuts and a shift of $500,000 from the districtís unreserved fund balance.

The latter action will reduce the anticipated $2.083 million unreserved fund balance to $1.578 million. The unreserved or undesignated fund is a pool of money that can be used in any fashion by the school board.

The use of $500,000 was recommended as a means to soften general fund cuts in the next school year.

The new general fund budget is augmented by total revenue of $59.6 million. State sources provide for $48.5 million while local property taxes kick in $7.1 million. Federal revenue sources account for $2.1 million while the district receives $1.8 million in other local sources.

The budget approved last week includes no new revenue from the state because that action is yet to take place.

Change is coming

District administrators and the school board will be making budget changes in the next few months, however.

By formal resolution at the May business meeting, the board approved a plan to add back a minimum of $500,000 in anticipated new state revenue based on early projections of some new state aid.

Larry Martini, director of business affairs, said the main focus of the $500,000 will be used to restore some of the 14 classroom teaching positions that were cut this spring.

The new revenue, however, may be even more lucrative than school officials once thought.

Lynn Steenblock, superintendent, told the board last week he is anxiously awaiting the deliberations in St. Paul.

Under Gov. Pawlentyís funding plan for K-12 education, Steenblock said basic state aid could go up by 4.5 percent a year in 2005-2006 and in 2006-2007.

That would translate into $1.9 million for Forest Lake in the fiscal year starting July 1 and $2 million in the 2006 school year.

Martini said it was his understanding that the bulk of any new money received by the district would go to restoring budget cuts made this spring. If the new revenue is near the level proposed by the governor, the business manager said he would strongly favor replacing some of the dollars in the districtís unreserved account.

After recovering from statutory operating debt two years ago, the district has continued to build its rainy day fund but is still well below levels recommended by district auditors.

Although the school board could act sooner if its revenue is significantly changed, Martini said the normal schedule for budget adjustments would be in November. The boardís finance committee will be involved in the process, as well.

The new budget is based on revenue assumptions for average daily membership of 7513 students or 8534 total weighted pupil units. The districtís basic state aid allowance is $4601 per pupil, an amount that has not been changed since 2002-2003.

Expenditure assumptions are based on salaries and wages that will increase 2.5 percent and a 9 percent medical insurance cost increase. Other fringe benefits will rise by 10 percent and utilities will increase by 6 percent, based on expenditure assumptions prior to budget reductions.

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Forest Lake Times
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880 SW 15 St.
Forest Lake, MN 55025
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