District 88

OKs audit

report

By KREMENA TODOROVA

Journal Staff Writer

NEW ULM -- District 88 financial statements for 2003-2004 accurately reflect the financial state of the district, according to an audit by Peterson and Co., P.A., of Mankato, approved by the Board of Education Thursday night.

According to extensive financial documents briefly reviewed at the meeting, the district's general fund reserve decreased from roughly $3.3 million at the end of 2003 to roughly $2.2 million at the end of 2004.

According to the auditors, the $2.2 million balance is enough to support the district's operations for about 38 days. In comparison, the state recommends that school districts maintain a large enough balance to support operations for 45 to 60 days.

Local officials have long acknowledged that dipping into reserves, along with program cuts, has been a way to offset a drop in state funding.

"It's a major drop," noted Superintendent Harold Remme, also cautioning that reserves could decline even further, unless statewide trends change -- or else more difficult local decisions are made.

The general fund represents by far the largest part of a school district's budget. General-fund money is spent on major items such as salaries and benefits, supplies and materials and building operation and maintenance.

In another highlight, the audit shows very little variance between the district's original budget and its actual revenues and spending. Actual revenues were up about one-tenth of a percent from the budgeted amount, while spending was about a percent higher.

In terms of total dollars, general-fund revenues amounted to about $19.5 million and spending ran at $20.6 million.

The audit report also showed that about 70 percent of general-fund money went for salaries and benefits, and about 23 percent went for "purchased services." Smaller amounts were spent on supplies and materials (3.7 per cent), capital projects (3.3 percent) and other items (0.2 percent).

The auditors noted that the amount for purchased services was atypically high. They explained it with the unusual amount of air-quality improvement projects that the district has recently had to complete.

Having just received the extensive, numbers-rich report, school board members made very few comments.

In an agenda otherwise devoid of action, the board also:

* Acknowledged the receipt of a report on traffic patterns near schools commissioned by the City of New Ulm and completed by students from Minnesota State University, Mankato.

Officials noted that the report and its findings will be discussed by the City Safety Council and school district representatives at a later date.

* Heard an informal presentation from Business Manager Donna Luhring on a new, credit-card-like method of paying for materials or services purchased by school employees.

Luhring explained that, under a new statewide program, the district could issue purchasing cards (P-cards) to specific employees. The cards would have a set spending limit and would be coded for certain types of spending. They would save staff the time to go through the purchase-order process currently used. No action was taken on the matter.