2014-04-24 / Front Page

MAS hit by extra $200K

District budget sees unexpected expenses

MANISTIQUE – The district’s general fund budget just got sideswiped by a $273,908 decrease for the 2013-14 school year. During Monday’s meeting of the Manistique Area Schools Board of Education, members approved an amendment outlining the “significant” loss.

According to board member Giannine Perigo, the board’s budget and finance committee produced a prepared statement explaining the loss. The committee consists of board members Perigo,

Tim Zellner, and Rae Birr, along with Administrative Assistant Donna Winkel.

“The reason that we wanted this to be in writing and clear so that all the facts are there,” Perigo said.

The committee requested the board approve an amended 2013- 14 general fund budget and adopt a 2013-14 general appropriation resolution for the fiscal year.

“The circumstances of tonight’s general fund budget amendment are unique, but the overall impact to the 2013-14 fund balance is significant,” Perigo read. “The total impact or change to the fund equity is a minus $273,908.”

Perigo said the loss is due to $286,488 in what are expected to to be one-time expenses. The largest one-time expenses include: $90,505 for at-risk carryover, which are grant funds now providing two hours of Multi-Tier System of Support in the middle and high school; $85,982 for a new bus, following an accident on Nov. 11, 2013 in which insurance only paid $20,000 for the totaled vehicle, leaving the remainder to be taken from the general fund; $46,000 for utilities due to this winter’s “harsh” conditions; $45,000 due to a State Aid deduction from special education funding because the district’s number of special education students decreased; and $39,000 for an operation/maintenance vehicle after the one being used broke down.

“The board previously set a fund equity minimum of $300,000,” Perigo explained. “The district will continue with a ‘needs only’ spending freeze implemented at the start of the school year to ensure a year-end general fund line items balance of $200,000.”

Following the budget adjustment, Perigo said the proposed 2013-14 budget will have a projected year-end fund balance of $252,432, plus a $200,000 from year-end line items, to equal a total of $454,432 fund balance.

“Basically, there were a lot of things that happened that we’re lucky that we had a fund balance to help cover,” she said.

Perigo noted that anything the district doesn’t spend from the $200,000 line item balance will be added to the $252,432, which would give them the approximately $400,000 fund balance.

“These ones that were written out are the largest of the one-time expenses,” said Superintendent Kathy McDonough. “The point you need to keep in mind is, what happens if this happens again?”

McDonough went on to state the district needs to stay focused on saving what they can.

“By generally accepted accounting practices on an $8 million budget, which is approximately what ours is, we should be carrying an $800,000 to $1 million fund equity balance,” she said. “To say we are dangerously low at $300,000 – we are.”

However, McDonough pointed out that the board set the $300,000 fund balance minimum and the district has been able to maintain it for two budget years, which is a “positive”.

“We hope not to have these type of one-time expenses happen anytime again soon,” she said.

Perigo emphasized that the board recognizes everyone’s efforts in keeping the budget managed.

“We appreciate the belt-tightening that’s been done already,” she said. “You can’t plan for some of these events that we’ve had this year, but we can plan as best we can for the future.”

The board unanimously approved both the amendment and resolution.

The board also adopted the Delta-Schoolcraft Intermediate School District 2014-15 budget resolution.

“They’re looking for support or non-support, and irregardless [sic] of the support do or don’t give, the budget moves forward in the ISD realm,” McDonough said. “I would ask that you support it in that they do provide this district with an awful lot of service.”

She noted the school psychologist, physical therapist, occupational therapist, general education directions, STEM online assessment, and data disaggregation, come from the ISD.

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