Area News | Home | Marketplace | Community

Return to Archived Stories

Paynesville Press - December 5, 2001

District #741 starts budget cut process again

By Michael Jacobson

The prospect of more budget reductions within the Paynesville Area School District took steps at becoming a reality last week.

On Thursday, Nov. 29, the school board approved a resolution to commence the budget reduction process again and approved a schedule for it. (The board met on Thursday last week, instead of Tuesday, as normal, because of the winter storm.)

The process for budget reductions will be the same as the district used a year ago, when over $500,000 was cut from the district's budget for the current school year. The first step will be to have the administration review the budgets and programs and make a list of potential reductions, which will be made public in January. Then a public hearing will be held on Monday, Feb. 4, 2002.

After that, the board will have two weeks to think about the possible reductions and rate them before a final decision is made on the reductions at a regular board meeting on Tuesday, Feb. 26, 2002.

The board did not discuss how much needs to be cut from the district's 2002-03 budget, but superintendent Howard Caldwell has stated that the budget needs to be reduced by at least $150,000 next year just to compensate for the loss of graduating seniors. The 12th grade is the district's largest class with 119 students. Incoming kindergarten classes in recent years, by contrast, have had around 85 students, which translates into a projected loss of at least 30 students for next year.

With the extra weighting given to senior high students in the state funding formula, this translates into a $5,000 loss per student.

The school levy referendum that was defeated in November would have provided the school district with nearly $500,000 in additional revenue for the 2002-03 school year. Without that levy, a similar amount may need to be cut to balance the district's budget and get the district's general fund out of the red.

"The people have spoken," said superintendent Howard Caldwell about the need for more budget reductions. "They don't want to give us any more dollars."

The general fund had a small balance ($57,081) as of June 30, 2001, but unreserved funds were already in the red (-$243,000), which has qualified the district for statutory operating debt. The district must present a plan to the state by the end of January on how it will balance its budget and reverse its finances.

Like last year - when nearly $700,000 in potential cuts were proposed but only $500,000 were actually implemented - the administration will propose more areas for reduction than will eventually need to be made.

Despite the reductions that took effect this year, the district still has a deficit budget for 2001-02.

District #741 Budget Reduction Schedule
Nov. 29, 2001
Board approves resolution to direct the administration to begin the review of budgets and programs for possible adjustment in the 2002-03 school year.

Nov. 29, 2001-Jan. 18, 2002
Budget adjustment information gathering by the administration.

Jan. 18-Feb. 1, 2002
Information review and exchange.

Feb. 4, 2002
Public hearing on proposed adjustments.

Feb. 4-Feb. 15, 2002
School board analysis of reductions.

Feb. 26, 2002
Review and approval of appropriate reductions.

The board addressed two other issues on Thursday that were related to budget reductions.

First, the board heard a presentation from Tom Watson, a consultant who has worked for nearly 20 school districts across the state, including Willmar and Litchfield. The board did not make a decision about hiring Watson, who would look at efficiencies and the cost effectiveness in the district's buildings and grounds, financial management, personnel, transportation, and other areas.

Watson's analysis of the district's spending on transportation for the 1999-00 school year indicated that the district was not spending excessively, but he pointed to having 96 percent of students being eligible for busing as proof of the need for change. "It sounds to me...that you're picking up kids a block from school," he said. "That's desirable, but you can't afford it."

"You provide Cadillac service," he added. "I'll tell you that right now. Most districts have gone away from some of that, in terms of who is eligible to ride and how far (they ride)."

Marlene Theel and Phyllis Nielsen, representing Paynesville Motor and Transfer, the district's transportation contractor, told the board that they already were planning to reduce the three routes on the north side of the district to two for next year. Another route could possibly be eliminated, too, they said.

One idea of Watson's was to get students who drive instead of ride bus to sign a waiver eliminating the district's responsibility for picking them up each day. This would allow more seats to be used on the bus each day and might allow for further route reduction, though at the cost of longer bus rides, he said.

Theel and Nielsen questioned if waivers could be revoked and would provide much savings in the long run. The weather last week, they said, boosted bus ridership as parents preferred having their kids ride to school rather than drive.

The district does have a contract with Paynesville Motor and Transfer through June 30, 2002, so any changes this year would have to be negotiated with Nielsen. She expressed an interest in working with the board and being part of the solution as the district faces financial trouble.

Staff development
The board approved eliminating the carry-over funds for staff development, a savings of $28,000 to the district.

The school district is required to spend two percent of its foundation aid from the state for staff development. For the last two years, the district - with the consent of the teaching staff - has opted to spend only one percent on staff development. Now, as a district in statutory operating debt, District #741 is not required to spend any money on staff development.

The $28,000 is money that was leftover from previous years. It was money designated for staff development that wasn't spent.

The district also has over $57,000 in staff development funds for 2001-02 that has not been spent yet, and the board expressed its desire to not spend the entire one percent designated for staff development this year. While opting not to cut all staff development funding, because of the training that is absolutely necessary, the board told the administration to warn the staff that these funds should be used judiciously.

Contact the author at   •   Return to News Menu

Home | Marketplace | Community