School Board Considers Long Range Projections
Rochester, MN (KROC AM News) - The Rochester School Board is expected to approve updated long-range financial projections during Tuesday night’s regular meeting.
The projections are not as rosy as the five-year forecast that was presented to the school board in December. That report projected the school district would finish the previous fiscal year with a general fund reserve of about $15.4 million. It’s now projected that figure will be about $2.3 million lower, which will have a negative impact on the school’s financial outlook in coming years.
School District officials say an accounting error is responsible for about $400,000 of that amount, but most of the discrepancy is due to higher expenses associated with the latest teacher contract. Looking forward, district officials say employment levels will rise much faster than the previous five-year projections had predicted. That will crimp the school district’s ability to increase its reserve fund to soften the impact of rising costs several years down the road.
The five-year projection from last December anticipated the school district would add only about six full-time equivalent positions for the next school year. Because of rising enrollment, the district will actually be adding over 50 full-time equivalent teaching positions at a cost of over $4 million.
The report to the school board includes several different scenarios that compare the impact of different levels of state funding and using the maximum levy authority that was approved by voters last fall. That alone, could boost the district’s revenues by $2.8 million a year while increasing the property tax on the $200,000 home by approximately $32 per year. Depending on the scenario, the school district could face the prospect of making significant budget cuts as soon as the 2017-2018 school year or not have to make any cuts all the way through the 2019-2020 school year.