High energy costs fuel troubles for schools

District 88 has spent $35,000 more for fuel

in past 3 months than last year at this time

By GUY PRIEL

Journal Staff Writer

NEW ULM -- With rising heating costs, declining enrollments, and several weeks of cold weather, school districts are feeling the pinch on their operating budgets.

"We have been monitoring fuel usage in comparison to last year to determine what is going to happen," District 88 Superintendent Harold Remme said. "Usage has been up because of the colder weather. We will fall short of what we budgeted for the year, though."

The district has already spent $35,000 more for fuel in the past three months than had been spent by this time last year, Remme said.

"District 88 increased its budget in anticipation of an increase, but the increase was not enough to cover the current costs, according to Remme.

The district budgets for fuel based on a three-year average because the amount of usage can vary each year. If the district falls short, that portion of the budget will maintain a negative balance until the beginning of the next budget cycle, Remme said.

For 2000-2001, District 88 budgeted $275,000 for energy costs. As of Dec. 31, the district had spent $159,579, or 58 percent of the budgeted amount, Business Manager Donna Luhring said.

"The three worst heating months are still coming," she said. "The energy expenses are 45 percent higher than they were last year at this time. We will probably be over budget."

The rising costs have had a $49,817 impact already. The remaining funds are taken out of the general fund. Officials are hoping there will be areas where the district is under budget so the difference can be matched, Luhring said.

"We have been trying to reduce our energy usage district-wide, but usage is up by 32 percent," Luhring said. "The price of fuel has also increased. The cost of gas is double what it was last year at this time. This will have a large impact on us before the end of the fiscal year."

A bill has been introduced at the state Legislature that will provide $30 million to schools to help districts deal with rising fuel costs. If passed, the money will be taken out of the general fund.

"There is a good chance that this will pass," Remme said. "If it does, there is a good chance that we will get the funds this year instead of having to wait until next year."

In other area schools, heating costs are also affecting budgets.

At GFW Schools, December's heating cost was $28,000. The district only budgeted $46,000 for the entire year, Superintendent Stephen Malone said.

"A lot of that has to do with the price of natural gas," he said. "We will have to include more in the budget for next year as a result. This has really caused a crunch. What we have budgeted was based on past years, and it has always been adequate for our needs."

Any additional funding will have to come from the fund balance. Part of the problem is declining enrollments and a decrease in funding from the state. Energy usage remains about the same or increases, though, Malone said.

"The government is telling us we have to reallocate the funds," Malone said. "This has taken a chunk out of our budget. I am not sure if we will get any relief this year or not."

In Nicollet Schools, there has not been a major impact on the budget so far, because the district has been burning off fuel oil that was in reserves, Superintendent John Hornung said.

The district has a 20,000-gallon underground fuel tank. As long as the weather holds, the district should be in good shape, he said.

"We won't fill the tank until we know what it will cost us," Hornung said. "We have the ability to switch over to natural gas at any time. It will have an impact because of the increase. We pay more for regular fuel, which will also impact us in the future."

School districts don't have many easy days left anymore, unless the government comes through with more funding for districts, he said.

In Sibley East, the heating bill jumped 45 percent between November and December. The district spent $13,000 more than it did in January 2000, Superintendent Charles Rick said.

"I am not sure where we stand because the bill for January hasn't arrived yet," he said. "I do know that we are not over budget yet."

Between November and December 1999, the district spent $17,081 for heat. During the same period for 2000, the district spent $31,046. It budgeted $61,000 for the entire year, Rick said.

"If the January and February bills are close to December and November, we will exceed our budget," Rick said. "We will also have to see if the costs increase again."