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School leaders take aim at overall financial health of district



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November 27, 2013 - Goodrich-By a 7-0 vote on Monday night the school board of trustees accepted an audit from Lewis & Knopf for the 2012-13 fiscal year ending June 30.

The reported presented by Jeff Sabolish, principal of Lewis & Knopf, was clean and ended with $1,461,320 in fund balance— about 8.36 percent—a decline of $597,295 in reserves from the 2011-12 fiscal year.

"That's a one month reserve," said David Cramer, school board president. "Most districts need at least a two month reserve—our goal as a board is a 10 percent fund balance. We are trying to keep our head above water. That fund has been dropping five of the last six years. We are not where we need to be, honestly we continue to spend money we don't have—if we don't make this right we are in trouble."

The audit included total revenues in the general fund of $16,889,570 with expenditures of $17,486,865.

Scott Bogner, district superintendent, said several long-term factors need to be considered in the next few years.

"First we need to live within our means," he said. "The overall health of the district is our concern. Consider the district has $53 million in bond debt that includes about $26 million Oaktree Elementary School and Raymond Green Auditorium, not to mention the $15.4 million passed by voters in 2010. We have too much debt for our size district. Five years ago we had $3.4 million in the fund balance, now it's down to $1.4 million. That money will never come back. The days of 15 percent fund balance are gone. The economic decline locally has been sliding too long. Now tough decisions have to be made."

Bogner points to school enrollment as a key factor.

"Consider right now the high school freshman class has 180 (students); sophomores, 200; juniors, 180; and seniors will be about 170 students," he reported. "Now there are only 120 coming into kindergarten. Schools of choice are not going to save us. That decline in enrollment will catch up. There are only so many students in our area that can attend. We cannot ignore the fact it will decline sharply."

Class size is also an issue in the district due to the reduction in staff.

"I'm not happy with 40 kids in a class," he said. "But consider we have the skill center and dual enrollment at Mott Community College, the University of Michigan-Flint and Kettering University in Flint. Also, eighth grade can get high school credit. I'd love to have 22 kids in a classroom, but size does not have as much impact on learning as does instruction."

"Overall this board has made excellent conservative decisions and are moving in the right direction. From reopening labor contracts early next year with support and teaching staff, to schools of choice to shared time agreements with Valley Lutheran School—they have done what is necessary, but not always popular."

"But we are not there yet. We need to put this district in a position over the next few years to take advantage of the lower interest rates on the bonds we currently are paying. Deficit spending each year will not get us there."

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