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School district financial prospects falter

After a revised budget in February indicated the need to take $763,000 from reserves for the 2014-15 school year, the latest figures show Red Wing Public Schools must spend down $1.8 million.

Supt. Karsten Anderson said business manager Jackie Paradis, who took over for former Director of Finance Brad Johnson in April, alerted him of the discrepancy in projections last week.

“We knew that our fund balance was going to go down, but the magnitude of the decrease was larger than we thought,” Anderson said. “It’s a pretty significant decrease in our fund balance.”

If projections hold, the decrease is expected to leave approximately $1.8 million — half of the current $3.6 million — remaining in the district’s general fund balance, according to minutes from Monday’s Finance Committee meeting.

More definitive numbers won’t be known until sometime in September when the auditor’s work is finished, Anderson said.

Anderson said enrollment projections – which can significantly affect the amount of revenue a district receives – were below actual numbers received after the end of the fiscal year, which runs July through June.

To compound the problem, district expenses came in higher than expected.

“We also had expenditures over the figures,” Anderson said of February’s revised budget, citing electrical costs as one example. “The revised budget should have anticipated that and it didn’t.”

Anderson said discrepancies can occur when changes are made in the finance office of a school district in terms of preparing budget projections, but he didn’t think the shift from Johnson to Paradis played a significant role in the jump of the expected decrease by nearly $1.1 million.

The district tries to make cuts when prudent, Anderson said, but there isn’t much to be done for fixing a past year’s budget.

“These are last year’s numbers, so what’s done is done,” Anderson said. “So we’re going to have to be exceedingly careful throughout the year.”

The budget reconciliation work the School Board concluded in February – which cut approximately $1.6 million from the 2015-16 budget – should help stabilize the budget, he said.

Anderson said recent budget projections will be highlighted at the Aug. 3 School Board meeting at Red Wing High School.

John R. Russett

John Russett is a regional reporter for RiverTown Multimedia, covering a variety of issues facing RiverTown communities. Previously, he worked at the Red Wing Republican Eagle, where he reported on education as well as crime and courts. 

You can follow him on Twitter at @JohnRyanRussett


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