Blaine school district spending cuts to lower anticipated deficit to $2 million

The Blaine school district released a draft budget for the 2023/24 school year July 10 that spends nearly $3.5 million less than last school year and reduces the district’s anticipated end of year deficit to $2.1 million. 

Last year, the Blaine school board adopted a budget for the 2022/23 school year that included a budget forecast where expenditures exceeded its revenues to a point that, by 2026, it would have a $14 million deficit. As state law requires a district to balance its budget before each upcoming school year, the district is now taking steps to manage its future fund balance.

The reduced budget comes after the school board passed a reduced education plan in April that would allow district administrators to remove a maximum of 65.2 positions this summer to address budget shortfalls. Blaine school district superintendent Christopher Granger has since said the district will be eliminating 59.5 positions, which would include 50 layoffs. The other positions were eliminated through employees who were retiring or otherwise leaving the district.

The eliminated positions have allowed Granger and district finance director Amber Porter to prepare a draft budget with total expenditures around $41.8 million and expected revenue from apportionment, taxes and grants to be $39.7 million. Granger and Porter will present the draft budget to the public at 5 p.m. Monday, July 24, before the regular school board meeting at 7 p.m. The school board is then expected to formally adopt the budget at its August 28 regular meeting.

District projections show that it will start next school year – September 1 to August 31, 2024 – with a beginning general fund balance of nearly $4.6 million, according to the draft budget. The projected $2.1 million funding deficit over the year will then leave the district with a general fund balance of $2.5 million.

When calculating revenue, Porter used a full-time equivalent (FTE) enrollment of 1,988.5 students along with 145.299 certificated and 88.745 classified staff. According to the draft budget, enrollment projections are based on the spring 2023 cohort and conservative kindergarten projections. 

The district’s budget shortfalls are the result of declining enrollment and rising labor costs following the pandemic. Blaine saw 40 fewer kindergarten students than it budgeted for this past school year and lower enrollment across most grade levels.

The draft budget says the district’s fund balance represents resources available for unexpected events and cash flow considerations. The general fund accounts for all financial operations except for Associated Student Body (ASB), debt service, transportation and capital projects, which have separate funds.

State law also requires the district to draft a four-year budget forecast along with its budget for the upcoming school year. The district’s four-year forecast has an ending general fund balance of $370,305 following the 2026/27 school year. 

But that figure is assuming the district balances revenues with expenditures in the future years or find ways to increase fund balance during 2023/24, as state law requires the district to budget an immediate fiscal year that ends with a positive fund balance. The district’s ending fund balance without future adjustments would see a nearly $2.3 million deficit.

The district’s capital project fund, which generates revenue under a six-year capital levy, is expected to run out of funds by the end of 2024/25, unless voters approve additional levies or bonds, the budget says. 

The ASB and transportation funds are projected to spend all revenues received. The debt service fund will pay for any accumulated debt.

The public presentation on the 2023/24 budget will be held in the district boardroom at 770 Mitchell Avenue. The full draft budget can be found at bit.ly/46MdXIA.