Post Falls to run schools on reserves

Rising health insurance, gas and energy costs have forced the Post Falls School District to dip into its reserve fund, Superintendent Jerry Keane said.

Local school districts are finalizing their budgets for the coming year. Last week, Post Falls approved a $24.6 million school budget that relies on both spending cuts and the district’s reserve fund to make it balance.

“With this year’s budget, we’ve kind of hit the end of the cycle where we’ve been able to scratch together budgets,” Keane said. Increases in state funding haven’t kept pace with the climbing expenses and the cost of operating the district’s two newest schools, he said.

Keane said he was reluctant to make the recommendation to pull money from the district’s reserve fund. Maintaining the reserve account “is not only good business,” Keane said, but it also helps the district achieve a good financial rating to sell bonds for new schools.

The move reduces the district’s reserve fund by more than half – from $813,000 to $400,000. The reserve fund will now be equal to less than 2 percent of the district’s budget.

“Most auditors will say you want a 7 percent or higher fund balance,” Keane said. “We have a board that says we want to keep it at 3 to 5 percent. We’ve been able to do this until now.”

The district is also cutting 1½ full-time positions in its Title I program, a federally funded program geared toward students from low-income families, and will eliminate other positions through attrition, Keane said.

Enrollment in the district has steadily increased – last year by 118 students or 2.4 percent, according to the State Department of Education.

Though the district receives additional classroom unit funding based on attendance, the unit funding has only slightly increased since 2001, from $24,440 to $24,695. “The increased state revenues just flow through the budget to cover the costs of those students,” Keane said in a report to the school board.

River City Middle School, which opened last fall, added $200,000 in expenses, Keane said. The new Post Falls High School added $400,000 in additional costs, he said.

State Superintendent of Public Instruction Marilyn Howard has described the state’s allocation for education for the next school year as “bare bones,” said Allison Westfall, spokeswoman for the Idaho Department of Education. Westfall said there was a 1 percent increase in classroom support funding from the previous year, but she said Howard didn’t characterize the budget as a “move forward” budget.

Districts have varying concerns about the budget, Westfall said, but some have cited increasing costs for transportation and health insurance.

Unlike Post Falls, the Lakeland and Coeur d’Alene school districts aren’t planning cuts. Still, administrators from both districts say money is tight.

The Lakeland School District has set a general fund budget of $21.3 million – an increase of 6.6 percent over this year, according to Business Manager Tom Taggart. Most of that increase was generated by an increase in enrollment, he said.

Lakeland grew by 142 students last fall, a 3.1 percent increase. Taggart said the growth exceeded the district’s projections and allowed Lakeland to collect emergency levy funds. He said the fact that the growth was spread throughout the district didn’t strain Lakeland’s schools.

Even with the added cost of a new facility – the opening of Timberlake Junior High – Taggart said the district was able to let its supplemental levy expire this spring.

Neighboring districts renewed their levies, both for more than their expiring levies. Coeur d’Alene voters approved a two-year $14.6 million levy this spring, and Post Falls voters overwhelmingly approved a two-year $1.75 million levy.

Coeur d’Alene Business Manager Steve Briggs said passage of the levy has helped the district’s budget in some ways. The levy, for instance, will provide funding for textbook purchases – an expense that typically taxes the district’s general fund.

Briggs said he is concerned that the state isn’t offering districts increased funding for salaries, which account for 85 percent of the district’s budget. The district is also adding a new building this year – Atlas Elementary – which will increase the district’s expenses.

On Monday, Coeur d’Alene’s School Board is expected to approve the district’s proposed budget of $54 million. Briggs said cuts are still possible, though, if the district’s projected enrollment increases don’t pan out this fall.

Though the district can “scrape by” this year, in Briggs’ opinion, he said he isn’t confident that will be possible a year or two down the road.