October 24, 2012 - By David Fleet
Goodrich-A sagging fund balance, aging buses and contract negotiations with district teachers could have a major impact on the finances for the 2012-13 school year.
On Monday night accountants from Lewis & Knopf, Certified Public Accounting attended the school board meeting for the presentation of the 2011-2012 audit.
"The district is in good shape," said Stephen Kidd of Lewis & Knopf. "The audit was clean."
The district's fund balance tumbled from about 15.5 percent or $2,776,469 at the end the 2011 fiscal year to $2,058,615 or about 11.81 percent.
In 2011 the district dipped into their fund equity for $104,000 to balance the budget. In 2012 the district pulled $717,854 from the reserves to balance their budget.
The revenues for the district were $16,708,209 with $17,426,063 in expenses. About 81 percent of the budget was attributed to salaries and benefits with about 10 percent in services. According to the audit, the district was $35,000 under budget with regard to revenues and $128,000 under budget on expenditures.
"We take a look at budgeted amounts verses actual," added Kidd. "That's a good indication the budget process is working."
Despite the clean audit, District Superintendent Scott Bogner anticipates dipping into the fund equity during the 2012-13 school year.
"The state recommends we should have a 15 percent fund balance range," said Bogner. "That's just not the case anymore. We've tried to save dollars, but we've brought back teachers to reduce class size. We've lost 24 students this year. We are not going to have 40 kids in a classroom, but we could be looking at reducing our budget from $500,000 to $800,000 next year. Unfortunately it's almost always people that the cuts come from."
"If we use our fund balance like we did last (fiscal) year we'll be broke in less than three years," he said.
Bogner added the Goodrich Education Association contract will expire in June 2013.
"The negotiations with the GEA will begin in January," he said. "Ultimately, the outcome of Proposal 2 will have an impact on those talks and the school district."
Proposal 2, on the November ballot, is a proposal to amend the state constitution regarding collective bargaining.
Also impacting the budget for the 2012-13 school year will be the aging school bus fleet.
"Right now we have five school buses that are at least 15 years old," he said. "We have not purchased a new bus since the 2007-2008 school year. In the past districts have a schedule to replace buses on a regular basis. New buses cost about $90,000 each so we are also looking at leasing buses if that would be better for the district."
"I'm concerned our buses will not pass the Michigan State Police yearly inspection," he added. "Many of our routes are on dirt roads and that is very rough on the buses."