Riverside-Brookfield High School finished the 2017-18 fiscal year, which ended last week, with an operating surplus of nearly $637,000, but is projected to run an operating deficit of 204,383 in the new fiscal year, which began July 1.
RBHS is projected to spend $25,559,205 million in the new fiscal year and have revenues of $25,354,822.
The tentative budget is on display and is expected to be approved in September.
The surplus for the 2018 fiscal year is a bit of fluke. It came about because at least $600,000 in property tax revenue slated for the prior fiscal year came in after July 1, 2017. As a result, that revenue was credited to the 2018 fiscal year.
A year ago officials were projecting that RBHS would run an operating deficit of about $326,000 for the just completed fiscal year.
According to a five-year financial projection laid out in January, the district expects to run deficits over the next five years. Officials hope to keep those deficits manageable. In 2026, the district will get some financial relief when the bonds that funded the 2006 expansion and renovation of RBHS are paid off.
“The idea is to work over the next five years with little to no operating deficit so that we can still maintain a 33-percent fund balance, but also make sure we spend down some of our fund balance,” said District 208 Superintendent Kevin Skinkis.
Skinkis said that he is comfortable with running a deficit in the new fiscal year and coming years, given the district’s level of reserves.
“While we would like to see an operating surplus or a balanced budget, I think we are still operating well within our means,” Skinkis said.
The district currently has about $12.7 million in reserve and is projected to end the year with reserves totaling 49 percent of the annual operating budget. The policy of the school board is to maintain reserves of at least 33 percent of annual expenditures.
“We’re doing much better than when I took over in 2011,” Skinkis said of the school’s financial condition. “We’ve just been able to manage expenditures. We’ve changed from a self-insured health insurance to a cooperative health insurance. That helped significantly. We’ve had several retirees.”
The district also sold $3 million in working cash bonds last year to bolster its cash position and take advantage of low interest rates.
The 2018-19 budget calls for an increase of one full-time-equivalent certified staff position. The district is beefing up its social worker staff, adding a part-time social worker, increasing its social worker staff to three. The district also hired a new full-time social worker to replace longtime RBHS social worker Mari Mortensen, who retired.
Increases in the cost of special education and staff raises as set by the teachers’ contract are the two main factors leading to the deficit, said Scott Beranek, the chief financial officer for District 208.
Salary increases for teachers and other certified staff average about a 3.33 percent, according to budget documents. Salary costs for administrators are projected to increase by 2.26 percent. Tuition for special education students attending out-of-district schools is projected to increase by about 16 percent.
General state aid to RBHS is projected to increase by 5.64 percent, as the state has implemented a new funding formula.