Colfax school board approves transferring $43,993 to capital projects Fund 46

By LeAnn R. Ralph

COLFAX  —  Following the audit review and a review of the proposed 2018-2019 budget, the Colfax Board of Education has approved transferring $43,993 in leftover funds to the capital projects Fund 46.

Fund 46 was started four years ago, and the money must stay in the fund for five years before the school district can start to use it, said William C. Yingst Jr. at the audit review meeting July 16.

All together, $48,993 was left over from the 2017-2018 budget.

Yingst proposed the school board consider transferring all but $5,000 to Fund 46 in case there was a remaining invoice or two from the school year that ended June 30.

Establishing Fund 46 required the school district to have criteria established for the capital projects fund. The criteria includes using the money for buses, roofing and other building improvements, Yingst explained, noting that his goal was to have $100,000 in the fund by the fifth year.

By adding $43,993 to the $64,915 already in Fund 46, the balance would then be $108,908, he said.

In the fifth year, the school district can use the money for anything included on the criteria list, Yingst said.

At the regular school board meeting following the audit review and preliminary budget review, the Colfax Board of Education approved transferring $43,993 to Fund 46.

General Fund

The general fund balance as of June 30, 2017, was $1,852,194.

The leftover funds of $48,993 represent about a half a percent of the school district’s annual budget, Yingst said.

“That’s good news for the district,” he said.

Leftover funds amounting to a half a percent of the budget means the school district is maximizing tax dollars and state aid with a little money remaining at the end of the year, Yingst said.

Fund 21

As of June 30, 2018, the school district’s Fund 21 for donations had a balance of $37,071.

Every year, the Sanger Foundation donates $5,000 to the school district, Yingst said.

Karen Sanger’s mother was a resident at Area Nursing Home, and every year since her mother passed away, the foundation has been donating $5,000 to the district, he said.

Between $1,500 and $2,000 of the donation is put toward student scholarships each year, Yingst said.

Fund 21 is a student assistance fund, he noted.

Fund 27

Fund 27 is the school district’s special education fund and does not carry a fund balance at the end of the school year.

The fund received revenue last year of $445,536 in state and federal money and had expenditures of $1,144,835.

The school district transferred $699,299 into the fund to make up the difference, Yingst explained.

The Colfax school district pays a little over 60 percent of the costs associated with special education.

Fund 38

Fund 38 is the school district’s debt service fund for the energy efficiency project.

The school district made two payments last year totaling $251,293.

Fund 39

Fund 39 is the school district’s debt service fund for the referendum projects.

The school district made two payments last year totaling $286,591.

The fund balance as of June 30 was $121,936.

Fund 49

Fund 49 is the school district’s capital projects fund related to the referendum projects.

Expenditures from the fund during the last school year were $4,407,212.

The fund balance as of June 30 was $351,700.

The school district has another year to finish spending the referendum money, Yingst said, noting there are several projects where the money could be used, such as for carpeting and the tennis courts.

Ken Bjork, school board member, asked if money in Fund 49 could be transferred to Fund 46.

Yingst said he believed the money could be transferred with school board approval.

Putting the money in Fund 46 would give the school district more time to use the funds, Bjork said.

Fund 49 must be clear as of December 2019, Yingst said.

Fund 50

Fund 50 is the school district’s food service fund and had a balance of $206,431 as of June 30.

The food service fund has a healthy balance, and some of the money is now being used to replace kitchen equipment and other equipment used to provide meals, Yingst said.

Implementing the federal breakfast program turned around the food service fund, which used to end the year with a deficit, he said.

Audit

Yingst said he was pleased with the results of the audit.

The school district has been using the Baird budget model, which has helped smooth and streamline the process with the audit conducted by Wipfli LLP, he said.

With nearly $2 million in the general fund, Bjork wondered how low the general fund goes during the school year.

The school district used to have to do short-term borrowing to pay bills because state aid does not always come through at the same time each year, Yingst said.

At times, the school district would have to defer the health insurance payment of $130,000 for one month and then double up the next month and make a payment of $260,000 when the funds were available, he said.

A change in the federal tax code means there is now no incentive for people to pay all of their property taxes in December. The change in the tax code could affect the school district’s cash flow if more people elect to pay half of their property taxes in December and half in July, Yingst said.

“It would be a variable out of our control,” he said.

The district’s cash flow does “get tight a couple of times per year,” requiring close management of the budget, but the district has not had to do any short-term borrowing in a long time, Yingst said.

Budget review

The projected general fund budget for the 2018-2019 school year is $9,115,337.

As of July 16, it is the best projection that can be made for the budget, Yingst said.

The school district does not find out the exact amount of state aid for the year until October, he said.

During the second year of the state’s two-year budget, state aid projections are more accurate than they are during the years when the state Legislature is setting the budget, Yingst said.

The state is currently operating under the 2017-2019 budget.

The Colfax school district has 113 employees.

The total for the 2018-2019 budget for salaries is $4,612,909. The total for benefits is $1,733,878.