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D181's End-of-Year Fund Balance Exceeds Budget Expectations

Assistant superintendent for business Gary Frisch said on Monday that the district likely had at least $573,000 more in its coffers when the fiscal year ended on June 30 than it budgeted for.

The new head of District 181’s business office says he’s comfortable with the financial state of the district as its fiscal year 2012 numbers are confirmed in the coming months.

Assistant superintendent for business and operations Gary Frisch said at Monday night’s school board meeting at that the district estimates the operating funds’ ending balance for fiscal year 2012 was about $573,000 larger than the district budgeted for before the 2011-12 school year.

The operating funds include the education, operating and management, transportation, social security and working cash funds.

Expenditures for the recently concluded fiscal year, which ended June 30, were slightly more than the district budgeted for according to Frisch’s estimates, which will remain estimates until independent auditors complete their fiscal check of the district in September. But the revenue the district took in from the most recent levy was $662,000 more than what was expected in the budget. The district budgeted for $51.24 million in levy revenue and received $51.91 million.

All-in-all, with state and federal aid included, the district took in about $57 million in total revenue during 2011-12 after budgeting for $56.24 million.

Frisch’s report said the district’s 2011-12 expenditures totaled about $55.1 million, a larger amount than the $55.05 million it budgeted for, though that actual-expenditure number is likely inflated.

The district paid out $37.92 million in salaries, above the $37.7 million it budgeted. Also, the district estimates employee benefits to have cost $8.87 million after budgeting $8.01 million for those payments, and purchased services to have cost $4.74 million after budgeting $4.28 million.

Frisch said he expects the actual costs on employee benefits and purchased services to come down after the audit is completed in September because his report included costs accrued since the end of the school year that, when adjusted, will be credited toward the current 2012-13 fiscal year’s expenditures.

Board President Michael Nelson asked the district’s new business head if anything “out of whack” with the fiscal numbers.

“I’m not seeing anything exciting, which is good,” Frisch said.

Nelson said he expected nothing less from the departed business superintendent Dr. Troy Whalen, but “it’s always fun to have a new set of eyes on it and see if anything pops up.”

In addition to ending fiscal year 2012 with larger operating-fund totals than expected, District 181 has added about $575,000 to its fund balance over its totals at the conclusion of fiscal year 2011. The district had $20.96 million in its operating fund on July 1, 2011, compared to the $21.54 million Frisch reported it had on July 1, 2012.

That $21.54 million represents 39.1 percent of the district’s total expenditures for 2011-12. Frisch said the most fiscally sound districts in Illinois have a 40 to 50 percent fund balance.

“I’d say 38 percent is comfortable; 40 percent, 50 percent, you’re more towards the ideal,” Frisch said.

The assistant superintendent agreed with board member Sarah Lewensohn, who said the ending fund balance is not as critical as the May 30 fund balance, which is when revenues are at their lowest before property taxes start coming in.

“That’s the top fund balance, that’s as high as its going to get,” Lewensohn said of the ending balance. “You also have to be mindful of what’s the low.” 

A large fund-balance increase is not currently expected for the 2012-13 fiscal year. That year's budget forecasts a revenue-over-expenditure difference of only $3,200.

"Basically it’s a balanced budget," Frisch said of 2012-13.

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