The Saline Area Schools district has stopped bleeding cash.
Assistant Superintendent of Finance Janice Warner updated the board of education on the 2012-13 budget for the first time since June. Much has changed that dire budget, including millions of dollars in concessions granted by the district's unions and pension reform out of Lansing.
The result is the district has turned a $1.5 million structural deficit into a $43,747 surplus.
“A $44,000 surplus may not be much, but it is better than a $1.5 million deficit,” Warner said.
School board President Lisa Slawson was happy to accept Warner’s report...
“As a board we should be standing up and doing cartwheels,” said Slawson, thanking administration, union leaders and staff for their work and sacrifice. “We can’t thank you all enough. We will not be a district taken over by an emergency manager.”
Trustee David Zimmer said the work done by Warner and her staff was remarkable. Zimmer said he was anxious to get the numbers and get to work on next year's budget.
“Our administration is stretched. Our bargaining units have given up concessions. And we still have teachers with very large class sizes and that’s something parents are concerned with,” Zimmer said. “I think we’re going to have difficult decisions going forward.”
Superintendent Scot Graden said that while the district made important changes this year, he agreed with Zimmer.
“We have a much better footing, but we are not out of the woods yet,” Graden said.
Trustee David Holden recommended the district begin using a five-year operating plan.
Saline entered the 2012-13 fiscal year with a tiny, $1.3 million fund balance, representing about 2.3 percent of the general fund budget, or about or about one-week’s worth of expenses. There were many unknowns when the budget was passed in late June. The teachers union had not yet agreed to a two-year deal with $7.5 million in concessions. Support staff agreed to a deal that provided the district with more than $550,000 in concessions in year one. Administrative unions also gave at the bargaining table. Additionally, pension reform is saving the district money. Warner noted that there were 14 retirements and resignations. The district hired three certified teachers and nine support staff workers.
The result is a budget with $49,166,003 in revenue and $49,122,256 in expenses. The district is also pocketing $519,714 from the sale of land to a company building an assisted living center at Maple Road and Woodland Drive. The land sale and surplus will allow the district to increase the fund balance to $1,748,768, or 3.56 percent of the general fund budget. Warner noted that had the MSPERS retirement rate not been bounced back up because of a court cases, the fund balance would be projected at $1,991,577, or 4.07 percent of the general fund budget. The Board of Education has a policy requiring that the fund balance be at least 5 percent of the general fund budget.
During the annual audit presentation early in the meeting, Plante Moran’s Jeff Dolowy the district’s fund balance has been lower than other districts around the state. He showed a chart showing that the average fund balance of the state was around 13 percent before it fell to 10.44 percent in 2010 before it began rebounding. Saline’s fund balance was at 7 percent before falling to 5.5 percent in 2010 and then 2.3 percent in 2012.