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Westonka Public Schools Receives Clean Audit
Borg Report October 9, 2019
I am pleased to report that auditors at the Oct. 7 Westonka School Board meeting gave the district an unqualified or "clean" opinion—the best opinion a district can receive.
The auditors reported that the district's revenues and expenses came in on target for 2018-2019. This is the result of enrollment growth, our community’s generous support of our local levies and the hard work and decisions made by our staff and school board.
The district was projected to use $168,765 of fund balance last school year and ended the year using $175,422. Westonka currently has an unassigned fund balance of $2,862,968, or 8.8% of general fund expenditures. The district relies on this fund balance to make investments in improving our educational offerings, reduce borrowing costs, and provide greater stability in light of the uncertainty of state funding.
Due to consecutive years of dipping into fund balance to make up for state and federal funding shortages, we are approaching the minimum needed to keep us within the fund balance goal set by the school board of 8-18% of general fund expenditures.
Current Year Financial Position. Westonka’s 2019-2020 revenue and expenditures are currently projected to be on track with our adopted budget projections. Last winter, the district was faced with an approximately $500,000 budget shortfall. The board approved a $300,000 spending cut for 2019-2020 and planned to cover the remainder with fund balance to avoid reductions that would significantly impact student learning.
The board has approved a projected decrease of $272,000 to fund balance for 2019-2020. Dipping into the district’s “emergency fund” to avoid programming cuts each year is not sustainable, which is why the board is asking the community to vote on an operating levy increase on Nov. 5, 2019.
Next Year’s Budget Planning. The 2020-2021 budget will largely depend on the outcome of the Nov. 5, 2019, referendum. School district residents will be asked to vote on a single ballot question to revoke all three of the district’s current operating levies and replace them with a single, 10-year levy with a tiered payment structure.
- A “yes” vote will bring in approximately $1 million in additional revenue for 2020, allowing the district to preserve class sizes, programming and student supports. The tiered levy approach lessens the tax impact for residents by accessing funds only as they are needed by the district. The levy would bring in an additional $1 million in revenue in 2024, when district enrollment is projected to plateau. Taxes on a $377,000 home would increase by $7.50 per month in 2020 and by an additional $6.50 per month in 2024 if the levy is approved.
- A "no" vote will direct the district to begin making significant reductions, starting with a projected $750,000 cuts in the 2020-2021 school year. Similar reductions would be required the following year. [Learn more about the referendum]
Consistent with previous years, a budget goal will be prepared by the end of January 2020 for the next school year.
2018-2019 Audit Report Now Available Online. For more detailed information, view the audited financial statement on the district website for the year ended June 30, 2019.
Sound Financial Management. Westonka has long been recognized for sound financial management. I want to thank the Westonka Financial Services Department for its careful work and the staff at large for the discipline shown. The district received the 2019 School Finance Award from the Minnesota Department of Education, which recognizes school organizations for sound financial management policies and procedures. Westonka also holds a very high "Aa2" bond rating. Additionally, Westonka continues to have the lowest total school property taxes of all school districts in Hennepin County. This will still be the case if the levy is approved on Nov. 5.
For questions regarding district finances or the referendum, please feel free to contact me directly.