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As was relayed during the November 2020 Cambridge-Isanti Schools operating referendum campaign, if the referendum does not pass, the district will need to cut $1.7 million from its budget for fiscal year 2022 to balance the budget.
The referendum did not pass, so the Cambridge-Isanti School Board is now facing the implications of that failed referendum as preliminary budget recommendations for fiscal year 2022 totaling $1 million were presented during the March 25 board meeting.
Superintendent Nate Rudolph explained the budget recommendations being presented are preliminary and no action would be taken by the board at that meeting. Administration will bring final budget recommendations to the board’s April 22 meeting for approval.
For fiscal year 2022, the district is facing $1.7 million in structural deficit. Rudolph explained the district will be able to utilize $700,000 of one-time use COVID-19 relief dollars to help balance the budget for fiscal year 2022.
“It’s important that we understand that that $700,000 will come back on top of our $1.7 million structural deficit next year,” Rudolph said. “It doesn’t go away. It shows back up. We are essentially deferring the expense for another year. And we are doing so because we’re balancing where we are and how much we’ve already cut with trying to get through this year. We’re intentionally utilizing this strategy to reduce the impact on students for the 2021-2022 school year and without a new revenue solution that will be deferred and added on to account for next year. We recognize that by doing so, we may face deeper cuts for fiscal year 2023. This allows us to make less of an impact on students in this moment and continue to find ways to become more efficient and continue to find ways to move it forward.”
In the past two years, the district has cut $7.5 million ($4.5 million in fiscal year 2020 and $3 million in fiscal year 2021) from its budget, which has led to larger class sizes, staff and teacher layoffs and fewer custodial staff. Rudolph said this has led to over 90 positions eliminated and the teaching and learning supply budget being reduced by 57% over the last two years: $667,000 reduced in fiscal year 2020 and $287,000 reduced in fiscal year 2021.
Rudolph noted without an operating referendum levy, the district is the lowest funded and lowest spending district in the Mississippi 8 Conference, and ranks 308th out of 330 school districts in Minnesota for per pupil funding. Compared to the state revenue average, the district receives $1,300 per pupil less than the average Minnesota district, which, based on the district’s enrollment, leads to $6.4 million less revenue per year for the district compared to the average school district.
Director of Finance and Operations Chris Kampa explained in 2010, the district had approximately $9 million in its general fund unassigned fund balance and at the end of 2021, the district had just under $2 million. Rudolph further explained the district currently has 2.3 weeks of payroll in the bank, and the recommendation for a healthy fund balance by experts is six to eight weeks of operating revenue.
“We recognize that we have a revenue problem, but to reiterate, the only lever that we have at this moment, in the short term at least, is our expense side of things,” Rudolph said. “We know that we’re facing a revenue problem rather than an expense problem. Unfortunately we are charged with making additional cuts at this time to balance the budget for fiscal year 2022.”
Kampa said the district does not know at this time if there will be any increases in the state funding formula for next year; he said typically the increase has been 2%.
“We don’t know if we’ll receive additional COVID support and we don’t know what sort of restrictions are going to be placed on that, so does it help us or hurt or not,” Kampa said.
Kampa also noted there is uncertainty surrounding enrollment numbers for next year. He said the district has lost students this past year due to homeschooling and online learning schools, so the district is unsure of how many of those students may come back next year.
As for the budget reductions, Rudolph said there are school district functions that are required and mandatory under state and federal law. He said as the budgeting reduction process moves forward, all parts of the district will be considered.
“We’ll commit to personal and proactive communication with individuals who will be directly impacted,” Rudolph said. “We’ll work cooperatively with employee bargaining groups and leaders to review the process and intended actions.”
Rudolph said the district website will provide up-to-date information and be utilized to gather feedback and answer questions. He said the community task force will be engaged and in-person staff meetings and virtual public forums will be held.
Rudolph said fiscal year 2022 budget reductions include reducing $264,000 in administration and operations; $736,000 in academics and class size; and $65,000 in co-curricular/fees for service, for a total of $1,064,000.
The $1,064,000 breaks down as follows:
• Buildings and grounds, $42,000.
• Transportation (walk zone, model, routes), to be determined.
• Co-curricular (uniforms, middle school activities, fee donation), $65,000.
• Administration and operations, $197,000.
• Retirements, $229,000.
• Academic programing (School For All Seasons), $245,000.
• Teacher staffing, $286,000.
“Now due to a need for further reductions and declining enrollment, we need to consider the School for All Seasons program once again. The reduction represents $245,000 and includes both personnel and operational savings,” Rudolph said. “We will be surveying families and meeting with them the next week to think creatively about alternative options and family priorities as we consider cost savings for the program and how we could meet family priorities in new and different ways.”
Rudolph said the district has lost about 250 students in enrollment this past year due to the pandemic, which is about the state average. He said the district is estimating getting about 50 of those students back for the next school year, but it will be working hard to get more students back.
For the purposes of teaching staff for the 2021-2022 school year, the district is looking at reducing 10 1/2 full-time equivalent positions (FTEs).
The district is proposing to eliminate five and one-half FTEs at the elementary level, with two due to declining enrollment and three and one-half due to budget reductions.
The district is also looking at reducing five FTEs at the secondary level, with one due to declining enrollment and four due to budget reductions. Rudolph said staffing notifications will be done on April 16.
Rudolph stressed staff and community engagement will be taken into consideration during the budgeting process the next few weeks through online feedback, staff meetings, board presentations and discussions and virtual public meetings. A virtual public forum will be held at 6 p.m. on April 7, with the link being provided on the district website.