4. No doubt many or you are wondering whatever happened to the fund balance which was approaching $20 million last Fall. I too, am curious. Greg Hein explains that a portion of the fund balance is the nearly $10 million which the school board has set aside. As well, the total was reduced by the contract settlement and increases in insurance costs. This part I follow. Where I, and others, start to get a bit lost is in the explanation of the designation of remaining funds and just how much actually remains. 5. Please rest assured that the fund balance will be scrutinized. We await additional information from the school district and plan to ask the research department of Education Minnesota to do an analysis of district finances. It may well be that the school district and the D.F.T. have a difference of opinion in regard to this area.

It is clear that the school district did not receive the 8 percent increase in funding that the Legislature promised. Problems now being experienced are due primarily to underfunding by the Legislature, increases in insurance costs and decreases III enrollment. 6. No doubt many members remember statements made by former school board members claiming that declines in enrollment would actually improve the district's financial position. I would hope that those persons would now come forward and show how this could be so. The reality is that the loss of students is what has hurt us the most.

What now? An analysis of district finances and the fund balance done 7. last Spring by our research department showed a consistent pattern of over estimating of expenses and underestimating of revenues. If this is again the case, then the fund balance would be larger than what the district is anticipating. If the school district seeks to both reduce the budget and lay off teachers, then they will need to be able to demonstrate to our satisfaction and perhaps that of a 8. hearing examiner that there is a financial problem warranting this action. 9. Still, a fund balance can only be spent down once, and an ongoing .shortfall will be ongoing. The long-term solution has to come from the Legislature.

10. If I were asked to make a recommendation, it would be to balance the budget this year with dollars from the fund balance. 11. During the course of the next year the legislature could he lobbied for additional funding. 12. At the same time the school district could establish a task force of parents administrators school board members and teachers to study a number of issues including curricular offerings, number of classes high school students are allowed to take, the programs which the district can support, the length of the school day, how many buildings may need to be closed, what reductions should be made in administration and so forth. Next year should the funding not improve and the budget scenario appear bleak, then the district would have a plan for dealing with the reductions which is based upon thorough discussion and research. I don't know all of what is scheduled to be cut this year other than a number of positions at the secondary level resulting in large increases in class size. 13. This cannot be the way to go.

2, This is the kind of thinking that got old school boards in trouble. Spend the money you don't have in hope that the legislature will come to the rescue. It doesn't look like there will be much legislative help this year.

3. I wish!

4. Its so darned frustrating to read this. I guess Frank genuinely has no clue. Every year I've been on the Board our savings spikes briefly as revenue exceeds spending then falls as the reverse becomes true. Our policy is to keep the reserve at ten percent of our annual budget by the time the year ends. That's only ten million dollars. When Frank looks at the books during the spike he's looking at a mirage.

5. To what end? Frank's had twenty years to study school finance. What good has it done?

6. I scratched my head over this claim and asked the Superintendent who Frank was referring to. Julio told  me it was Board members who said kids leaving for Edison wouldn't hurt us. Well, that's not quite what they said. They said that if kids left for Edison it would mean our educational expenses would shrink with them. That's not quite the same thing. And, of course, we still have an infrastructure that we must downsize or pay for. There's no question that that puts stress on our system. 

7. In some circles this would be called "prudence."

8. Shudder!

9. Truer words were never spoke.

10. I would resist this advice with all my heart.

11. And if we don't get additional funding? You only cut up your credit cards after you've gone into debt.

12. The School Board is strongly considering this.

13. Its the only way to go. I wish there were another alternative.