Grosse PointesJuly 3, 2012
District still in black with school budget
By April Lehmbeck
C & G Staff Writer
GROSSE POINTES — Like many districts, the Grosse Pointe Public School System has seen its fund balance shrink over the last several years, but it’s still keeping its head above water in the next fiscal year.
The school board approved the 2012-13 school year budget at its last regular board meeting in late June by a 6-1 vote, but the low fund balance projected for the end of the next year raised concern among board members.
It was the diminishing fund equity that had Board member Joan Dindoffer deciding to vote against the motion to approve the budget.
“To erode our fund equity by over 90 percent over the past four years with the unknowns that I have identified is, I believe, irresponsible,” she said. “I still have great concerns about spending our reserves to a point where we may be in danger.”
She mentioned that there have been many suggestions made by stakeholders on budget issues that have not been pursued.
Several other board members said that they, too, were concerned about the fund balance, but they would rather lower the fund equity than do anything to affect the district’s educational offerings.
“To me, the issue comes down to how skinny do you want your checkbook to be,” Board Vice President Lois Valente said. “I agree with Mrs. Dindoffer, it’s getting pretty darn skinny, and that is a concern. However, if the tradeoff is to start cutting programs, increasing class size … or cutting more staff, whatever creative ways that we think that we can come up with, if it starts to affect diminishing the quality of our education just so that our checkbook could be a little fatter, I’m willing to walk that line.”
Others agreed that the fund equity level is a concern, but there were other issues that took priority.
“There shouldn’t be any decisions that we make that will take away the value to the community of a strong school district like ours,” Board member Tom Jakubiec said, adding that he continued to support the district being a school that does not adopt a school of choice option to bring in additional revenue. “We owe it to the community to make sure that we stay a neighborhood-based school district. That, in my mind, reinforces that ‘what’s good for our community is great for our schools.’
“We just have to make sure we stay focused with good decisions so we don’t underpin the very essence of maintaining that learning environment for our students,” he said.
Board Treasurer Brendan Walsh took issue with Dindoffer’s use of the term “irresponsible.”
He gave a detailed presentation on the numbers, which he explained is all available on the district’s website, encouraging residents to take a look at the documents.
In that presentation, it shows that the district started out with $20.1 million in fund equity at the start of the 2009-10 school year. That number will be down to about $1.7 million at the end of the 2012-13 fiscal year. However, projections show it growing to $5.4 million at the end of the 2013-14 fiscal year.
The district has taken steps over the last few years to make changes affecting the district’s financial future. For instance, there were costs in recent years for a retirement incentive. Over the years, there have been cuts in staffing levels to tackle budget issues, yet district officials have kept class sizes lower than the trend in many other districts, according to officials.
Because the district has taken steps to reduce costs into the future, Walsh explained that the fund equity for this budget shouldn’t be the focal point.
“I think we’re in an incredibly strong financial position right now, and $1.8 million fund equity at the end of 2012 is not the meaningful measure,” Walsh said. “It’s where we are moving forward from a structural surplus standpoint.”
While other districts have worked to maintain fund equity at higher levels, some of those districts are still in trouble moving into the future since they haven’t taken steps to help their financial future, according to the presentation.
“We’re looking at a structural surplus as opposed to continuing to erode our programs,” Walsh said after comparing Grosse Pointe Public School System with other districts that have made other types of decisions.
One point of good news when it came to the budget presentation came in the enrollment numbers. Unlike many other school districts that are opening up their schools to students from other communities and still struggling with dwindling enrollment numbers, Grosse Pointe has been increasing its enrollment slightly without approving school of choice.
One struggle for many schools that Grosse Pointe is facing as well, though, is that the state is not increasing the district’s state aid allotment of $6,912 per student.
“Our revenue is flat, our expenditures continue going up,” Deputy Superintendent for Business and Support Services Chris Fenton said.
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