Lake Pend Oreille budget outlook: district plans to draw on reserves, advances CTE facilities project

Lake Pend Oreille School District officials said the district will draw on reserves to maintain current programs and pay for planned facilities work while moving forward on a career-technical education project funded largely by a grant and state facility dollars.

The district’s chief financial officer, Brian Wallace, told the board that the district ended a prior year with a roughly $22 million general fund balance and that the district expects to spend down a portion of that balance this year to cover planned costs, including facilities work and design fees. Wallace said the district is budgeting roughly $6 million for design and pre-construction costs this year and that a separate larger project that includes those costs is on the order of $18 million.

The district is also advancing a CTE facilities project Wallace said was supported by a grant of about $3.6 million; combined with additional state facilities funding the project budget is about $4.7 million. "Remember that's 5% of the funding formula and not a pure 5%," Wallace said when describing the state salary-based apportionment increase and how it feeds district revenue projections.

Why it matters: the district’s revenues are only modestly higher from the state this year, Wallace said, while salary and benefit costs remain the largest portion of ongoing expenditures. Wallace presented a multi-year view that shows salaries and benefits occupying roughly 59–61% of annual operating dollars and noted the district typically spends about 83–85% of its budget on salaries and benefits in a given year.

Key numbers and near-term steps Wallace presented to the board: - Prior-year general fund balance: about $22,000,000 (reported by Wallace as a healthy balance for the district size). - Projected drawdown this year: Wallace estimated about $1,500,000 (he called this an estimate). - Budgeted design/preorder costs this fiscal year: $6,000,000 (to cover architects and early equipment purchases). - CTE grant referenced: approximately $3,600,000, producing a combined project budget of roughly $4,700,000 when paired with state facility funds. - Health insurance increase used for planning: 7.2%. - Additional state revenue for salary-based apportionment budgeted at about $1,100,000; total adjustments for staffing and step movement discussed around $1,300,000.

Wallace told trustees the district will advertise the budget in the paper around Memorial Day to meet the statutory deadline for public notice and that a formal budget hearing is scheduled within about a month. He also said the district can amend the budget later if conditions change.

Board members asked about the district’s cash and interest earnings; Wallace said the district keeps surplus dollars in a local government investment pool that is liquid and earning higher interest than recent years. He noted federal and carryover federal funds have declined modestly as expected and that staffing adjustments related to retirements and step movement generate some year-to-year variance.

The presentation closed with a reminder that enrollment for the current year remained above the prior year, which helps revenue stability, and that questions on the details can be directed to CFO Wallace ahead of the formal budget hearing.