School District Budget

District Underspends General Fund Budget in 2008-2009 by $4.6 Million – (published October 15, 2009)

Cutting back on spending for supplies, fuel, extra manpower and a host of other things, the Rapid City Area Schools finished $4.6 million under budget for the 2008-2009 school year according to the District’s recently released annual report. These cuts to General Fund spending came on top of Board approved cuts that took place in the spring of 2008. With these savings, the District began the current 2009-2010 school year in a much more stable financial condition than had been predicted in the spring of 2008.

The Rapid City Area Schools grabbed headlines and packed nearly 1,000 people into the Central High School gymnasium in the spring of 2008 when the District announced that it would have to cut several million dollars from its budget. During public hearings and regular board sessions, the Board debated cuts to library staff, elementary band, custodial services and other programs. Additional cuts included the elimination of the Virtual High School program as well as several administrative positions. Although the Board approved cuts totaling nearly $2.2 million, the adopted budget was expected to reduce the District’s reserve or savings account to a level far below what auditors had recommended.

Without fanfare or public notice, however, over the course of the school year, administrators and staff cut an additional $4.6 million from the budget in an effort to stabilize the District’s financial position. The savings came from virtually every program covered by the District’s General Fund. In elementary instruction, for example, the District underspent its budget by $397,000 by eliminating extra duty for teachers, reducing the number of temporary teachers, noon duty supervisors and saving $84,000 on supplies. Middle school and senior high school administrators reduced spending by nearly $610,000 by adopting similar strategies.

Following the wishes of the Board and the suggestions of many members of the public, the Administration focused especially on cuts furthest from students. In Support Services, the District saved nearly $520,600 by reducing custodial services and building upkeep. Another $215,000 in expenses were avoided as prices fell and the District conserved on fuel, natural gas and electricity.

Across the District, employees cut back on supplies, with many departments spending only 50 to 60 percent of their usual budgets. Even the Board of Education pitched in. Underspending for Board travel, consulting, advertising and supplies resulted in a 10.6 percent savings compared to the original budget.

In fact, the overall effort to reduce spending was so pervasive that only a few programs failed to fall in line. Notably, high school athletics and activities came in over budget. Male athletics at Central and Stevens were over by 35 and 25 percent respectively. Female athletics at Central and Stevens overspent their budgets by 36.5 and 12.1 percents. Non-athletic extracurricular activities, for the most part, also ended the year over budget.

With the $4.6 million in additional savings, the District was able to end the fiscal year with $9.15 million in its reserve account or, in the language of school administrators, an 11.01 percent fund balance. At this level, the District is close to reaching its goal of having an auditor-recommended minimum fund balance of 12 percent to cover periods of time between tax collections when cash flows run low.

As the District begins the budget process for the 2010-2011 school year, the economic environment is not looking good. State tax collections have been hurt by the economy and legislators told school district officials this week that schools are unlikely to see much more than a 1 percent increase in state aid to education next year. Nevertheless, last year’s nearly heroic efforts by administrators and staff to hold the line on spending have averted a crisis for the moment and given some hope to students, parents and employees who feared another round of major budget cuts next year.

A copy of the District’s 2009 Annual Report is available here. (Warning: this file is 27 megabytes. Try right-clicking and saving the file if you have problems opening it.) The budget situation may also be affected by ongoing contract negotiations between teachers and the District. For an update on these negotiations, see Kayla Gahagan’s article in the Rapid City Journal.

Proposed 2009-2010

Business manager Dave Janak presented an updated version of the proposed 2009-2010 budget to the Board of Education in May. The District will not be able to project personnel costs until negotiations with bargaining groups are finished. By law, the Board is required to adopt a final budget for the 2009-2010 school year by October 2009.