The Daily Globe - Serving Gogebic, Iron and Ontonagon Counties

Powell: Ironwood finances improved since '17-18 audit

 

October 16, 2018



By RICHARD JENKINS

rjenkins@yourdailyglobe.com

Ironwood — While Thursday’s audit presentation isn’t expected to bring good news regarding the state of the Ironwood Area Schools’ fund balance at the end of last year, Superintendent Travis Powell said Monday the situation has improved since then.

“The fact the number is lower than we want it to be is unfortunate, but that’s last year’s news,” Powell told the Daily Globe after the meeting. “Moving forward, this year … my job is to keep expenditures low and to try and do everything we can to maximize revenues.”

While the district’s board of education will hear a report on the full audit Thursday, Powell gave its members a preview of one of the biggest takeaways from the document at Monday’s board of education meeting — that the district finished the 2017-18 year with a fund balance of $96,110.

The state recommends maintaining a 5 percent fund balance, or roughly $350,000 for Ironwood, according to Powell.

“So, (ours) is way less than that,” he told the board.

Further complicating the situation, according to Powell, is the fact that roughly $70,000 of the $96,110 is earmarked for specific purposes.

“That means our actual working unassigned fund balance is $26,000,” Powell said.

He said the district had projected a lower fund balance than previous years but it had been moving in the right direction overall.

“We were making steady progress toward that $350,000 mark … and it was looking like we were kind of going to get over the hill,” Powell said. “Things last year turned out different than they were initially planned and at the end of the year, (the district) projected it would be $134,000 — it was actually less than that.”

While the news is almost certainly not welcomed by the district, Powell did explain the situation isn’t as bleak as it may appear. The audit is a snapshot of the district’s finances at a specific point — the end of the last year — and the numbers are believed to have since changed.

“That’s also where 2017-18 ended. We’re still working on the projections for 2018-19 … I’m expecting we’re going to be moving up from this area,” he said. “It’s not clear exactly how far … because there are still a few more unknowns that need to be settled.

“But with decreasing spending, with having an increased per-pupil amount so the potential of increased revenue (is there), there’s potential for a gap between what we spend and what we make. That’s where we can replenish our fund balance.”

Powell was optimistic about the district’s current fiscal position and the direction it is headed.

“I expect this to be a negative blip on an otherwise increasing fund balance,” he told the Daily Globe.

He explained spending was higher than planned and revenue was lower than expected last year, leading to the fund balance being lower than expected.

While the specific numbers in the audit have only been finalized recently, Powell said the district knew the fund balance needed improvement regardless and had already been taking steps to return the district to where it should be financially.

“I had an indication our fund balance was going to be unfortunate, or unhealthy in this situation, when I started,” Powell said, adding he implemented a spending freeze on non-essential purchases and other steps to cut expenses.

Based on recent numbers, the changes seem to be having a positive impact on finances.

“Early indications are we are moving in a positive direction away from that number and I think if you looked at it over time I think it would be a negative blip — a dip in the fund balance that will be recovered,” Powell said.

The district passes its budget in June, amending it throughout the year.

In other action, the board:

—Authorized members of the senior class and organizers to continue researching the logistics of taking a trip to Los Angeles as the district’s senior trip.

—Called for bids for low-sulfur fuel and authorized opening two checking accounts needed to spend the money from the recently passed bond.

—Adopted a proclamation recognizing K-12 Principal Melissa Nigh for Michigan Principal’s Month.

—Passed a more in-depth version of the district calendar.

—Approved the personnel report as presented.

 
 

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