NY Mills School Board updated on finances
According to recently compiled financial reports, the New York Mills School District is pretty typical of other schools in the state, fiscally speaking.
The reports, written by two different companies, emphasize the fact that declining enrollment, changes in state aid and a low fund balance remain challenges for most districts, including NY Mills.
Jodie Zesbaugh from Ehlers and Brian Stavanger from Eide Bailly updated the school board on the financial status of the district at a meeting Monday.
Zesbaugh presented the completed Aid Anticipation Certificate report. The school sold $1,975,000 of certificates to the lowest bidder, Piper Jaffray and Company out of Minneapolis. The interest rate is .45 percent, which is right around the interest rate of last year. The total interest cost, which must be paid back by fall 2013, is $9,605.
The district has been selling Aid Anticipation Certificates to meet cash flow needs since Minnesota switched its policy on school paybacks. According to the executive summary by Eide Bailly, if the school did not receive aid anticipation funds, its cash flow would be in the negative. This is directly linked to when the state pays schools.
The interest rate on the certificates was not affected by the school's recent rating downgrade from Moody's Investors Service (from a rating of A2 to A3). This would affect long-term debt interest, but has no affect on short-term loans.
Stavanger also presented draft information from the school district's yearly audit.
The audit shows the fund balance at the end of the fiscal year, June 30, was $459,460. This figure is approximately 5 percent of monthly operating expenditures. The district's goal is to have a minimum of six weeks' worth of operating expenses as unassigned funds, which is 13 percent. The district has been building the fund over the last five years.
Rachel Grieger said having a large fund balance may make some decisions easier, however the district has chosen to spend money on upkeep at the school instead of saving it.
Expenditures have stayed steady the last couple of years in that three-quarters of the budget has been spent on salaries and budgets. The rest of the budget is spent on services, supplies and capital expenditures.
In other news, Alli Slieter was introduced to the board as the school district's new Minnesota Reading Corp member. She will receive a living stipend from the Reading Corp program to work full-time with elementary age students on specific skills of reading.
The shared gifted and talented program with the Perham-Dent School District will continue for another year. This program offers special classes for kids doing well in certain subjects.