The Daily Globe - Serving Gogebic, Iron and Ontonagon Counties

Ironwood board hears fund balance growing, passes budget

 

June 25, 2019



By RICHARD JENKINS

rjenkins@yourdailyglobe.com

Ironwood — The numbers may not be where the district wants them to be, but they are trending in the right direction. That’s the message the Ironwood Area Schools’ board of education heard Monday regarding the district’s fund balance as the board approved the final round of budget amendments for the current fiscal year and passed next year’s budget.

Although the exact numbers won’t be finalized until the annual audit is complete, Superintendent Travis Powell said the district’s fund balance grew from $96,110 to approximately $316,375 now.

“That’s a very favorable, positive improvement,” Powell said.

He explained the $220,265 improvement largely came from a mixture of reduced expenses and additional revenue from the state and federal governments.

He did warn the fund balance could change somewhat as the auditor completes his work, something that happened last year.

“We will know more in August, September; whenever the audit is complete,” Powell said.

The final budget amendments saw the revenue for the year increase from $8,086,823 to $8,413,829; and the expenses increase from $7,914,180 to $8,097,454.

Although the district’s expenses were more than originally budgeted, Powell told the Daily Globe after the meeting the expenses were still lower than the actual amounts spent last year. He said last June’s budget projections underestimated both expenses and revenues  — with the actual revenue being enough to offset the higher expenses and still grow the fund balance.

With the 2018-19 budget growing the fund balance to roughly $316,375, Powell’s projected 2019-20 budget is expended to improve the district’s financial situation a little more.

According to the numbers approved Monday, the district is projecting $8,502,928 in total appropriations and $8,185,525 in expenses. If these numbers are borne out, the district’s fund balance would increase to $317,402 at the end of the year.

Powell called the budget the board approved Monday was a fairly conservative document, leaving out additional potential savings that could happen over the course of the year, and he hopes the fund balance will grow more.

“The board just approved the area purchase agreement, that could potentially result in a savings of health insurance (costs). If that savings happens, that will have a positive effect on this fund balance,” Powell said, referring to a board action from earlier in the meeting. “This estimated fund balance at the end of next year is not taking into account that savings because it’s yet to be known. … The budget is built with the possibility of an increase in health care because there’s always an increase in health care. So there’s some potential positivity built into that.”

In other action, the board:

—Approved a change to the easement agreement with the city of Ironwood for the portion of the Miners Memorial Heritage Park on district property, excluding the district’s bus garage and other buildings from the easement. Powell said the city is working with the Department of Natural Resources to develop the trail system in the park and his understanding was the DNR didn’t want the easement to include any buildings.

—Approved entering into a purchase agreement with much of the Upper Peninsula’s educational personnel and the three unions representing district employees in an effort to obtain cheaper health insurance as a collective group.

—Ratified contracts with the three district unions extending the respective contracts through Nov. 1 to give the district a better understanding of its financial position while contract negotiations continue to avoid having staff pay for any cost increases out-of-pocket due to a new state law.

—Approved purchasing a new server and phone system for a cost of $18,900. The purchase will be part of the technology upgrades authorized in the recent bond measure, according to information presented at the meeting.

—Approved the school calendar for the upcoming year, with Aug. 27 as the first day of school and June 4 as the last day of school.

—Authorized district officials to seek bids for the annual milk and bread bids.

—Approved Powell’s evaluation, rating him as “effective.”

—Authorized the 2019 tax rate request and the 2019 summer tax collection agreement.

—Allowed Powell to roll-over more time off than originally allowed in his contract, due to how hectic the year was. The board’s approval came with the stipulation he wouldn’t make a similar request next year.

—Authorized an annual borrowing resolution to allow the district to take a loan needed to cover the district’s expenses until it receives its first state aid payment.

 
 

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