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 Fund balance question

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Sandra



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Join date : 2008-12-19

PostSubject: Fund balance question   Thu 15 Jan 2009, 7:54 am

One of the most ridiculous ideas that has come out of the Governor's office is for school districts to use their fund balance to offset some of the cuts. Do school districts face state limits for how much their fund balance has? What is the fund balance for Schenectady and are there plans to try to increase it for the future, in case upcoming budget years are even worse?
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PostSubject: Re: Fund balance question   Thu 15 Jan 2009, 8:37 am

Sandra wrote:
One of the most ridiculous ideas that has come out of the Governor's office is for school districts to use their fund balance to offset some of the cuts. Do school districts face state limits for how much their fund balance has? What is the fund balance for Schenectady and are there plans to try to increase it for the future, in case upcoming budget years are even worse?

A: There is a limit on the amount a district may have as fund balance (4% of budget). In our case that amount is about $6 million. We use a varying amount of our fund balance each year to control the growth of the tax rate in the district. We currently have about $4 million in fund balance. The Deficit Reduction Assessment (DRA) that the governor has proposed would take about $3.3 million of that amount, leaving the district with a severely low balance in this area. The only way to increase fund balance is to spend less than you budget. We have taken steps to reduce spending this year including strict oversight of all discretionary spending and not filling some vacant positions. As a result, the district should have some fund balance at the end of the year. Whiile the amount is not yet determined, it certainly won't make up, or come even close, to the DRA amount.


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Sandra



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PostSubject: Why not tax in good years to get to the maximum   Thu 15 Jan 2009, 8:40 am

Why doesn't the school district tax more in good budget years to maintain the fund balance as close to the maximum as possible?
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PostSubject: Re: Fund balance question   Thu 15 Jan 2009, 3:13 pm

Sandra wrote:
Why doesn't the school district tax more in good budget years to maintain the fund balance as close to the maximum as possible?

A: The board has always believed in and held fast to keeping any tax increase as low as possible to minimize the impact on the local taxpayers.
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Sandra



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PostSubject: do you think the board philosophy will change for the future   Fri 16 Jan 2009, 7:18 am

Now that there is a serious budget issue coming up, where ahving the 4% fund balance could have made a difference for at least a few teaching positions, do you think the board will change their tune for fund balances in the future? Most people try to have a savings account and 4% is not a huge amount, but would help for unplanned emergencies, having less painful cuts, or even saving an administration position. Taxes can be painful but if.when the economy improves, I hope the board and administration will consider moving towards having the full fund balance allowed. Just think about what a small difference a million dollars on hand could make at the moment.
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PostSubject: Re: Fund balance question   Fri 16 Jan 2009, 8:44 am

Sandra wrote:
Now that there is a serious budget issue coming up, where ahving the 4% fund balance could have made a difference for at least a few teaching positions, do you think the board will change their tune for fund balances in the future? Most people try to have a savings account and 4% is not a huge amount, but would help for unplanned emergencies, having less painful cuts, or even saving an administration position. Taxes can be painful but if.when the economy improves, I hope the board and administration will consider moving towards having the full fund balance allowed. Just think about what a small difference a million dollars on hand could make at the moment.

A: I think it is safe to say that we will always be fiscally conservative when it comes to raising the tax rate. The financial challenges we face are not caused by the board’s desire and commitment to minimize the impact our budget has on the tax rate. Our fund balance is the result of careful planning and cautious spending and that will certainly always will be our approach to building a fund balance. Everyone would love to have more money to spend on our children’s education; however we must also live within our means both in good times and bad.
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PostSubject: Re: Fund balance question   Today at 8:39 am

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