No major cuts to next year’s Duluth school district budget
For the second year, the Duluth school district is in the rare position of looking at educational investments instead of cuts. The Duluth School Board this week learned of the district's preliminary budget situation for next year, which maintains...
For the second year, the Duluth school district is in the rare position of looking at educational investments instead of cuts.
The Duluth School Board this week learned of the district’s preliminary budget situation for next year, which maintains the level of money spent last year on lowering class size, for example, and allows for more modest investments.
“We don’t end up in this position very often,” said Bill Hanson, business services director for the district.
The district for many years has been in cutting mode because of state funding and declining enrollment.
Thanks to the success of the 2013 operating levy referendum and increases in state aid, investments are possible. And a pending sale of the former Central High School property will help boost the district’s fund reserve back to where both School Board policy and financial experts say is a good place to be. The policy calls for 10 percent of operating fund expenses to be saved. Those total expenses have generally been about $100 million.
But because of recent drops in enrollment, what was anticipated in savings likely will be less. That number won’t be known until June, Hanson said.
Since November, enrollment has dropped by 182 students districtwide. This comes after a minor celebration at the beginning of the year when, for the first time since 1994, the district started the year with an increase in students. Final numbers for the year are tallied by the state in the spring. February enrollment shows 8,411 students.
Hanson pointed out that large numbers of those students moved out of the district or area.
But the impact of those losses means the projected $3.25 million balance at the end of the year will be reduced by a few hundred thousand dollars. Next year, however, the balance at the end is projected to be beyond the amount required by board policy, pending the sale of the Central property, which likely will garner $10 million.
The best news, said board member Bill Westholm, was that the surplus was continuing to build.
“It’s important to us in maintaining a healthy budget,” he said, because it means the district shouldn’t have to borrow for cash flow.
“It’s always nice to be considering budgets on the plus side … because for many years it was the other way,” said Westholm, a former longtime district administrator and teacher.
“It doesn’t mean we can spend whatever we want, but it obviously gives us a little more comfort in considering things (such as lowering class sizes).”
Hanson is estimating about $400,000 less in state aid because of projected declining enrollment, and increases in health care of 6.5 percent. Because of the large numbers of recent retirements, $800,000 has been built into the budget for severance, and $1.8 million for increases in salaries both because of the last negotiated contract for teachers and many advancing in pay for experience and education.
The budget doesn’t plan for an increase in the state’s per-pupil funding formula.
Investments presented to the board include those for the debate team, keeping lifeguards who were added to the middle schools this year and additional money to help improve academic performance. Taken out of the budget would be last year’s one-time expenses for closed-campus high schools and curriculum alignment work.
Some of the same items the board discusses each year as possible cuts remain up for discussion, including transportation changes and removing the zero-hour choice from sophomores. Every department will look for areas to trim. In order to invest, the district aims to cut from areas that will least affect students.
Adding the seventh period back to the middle-school day is listed as an option. It would cost more than $860,000. Several board members have advocated for the move.