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February financial report shows improving cash; district leaders warn cuts are not sustainable long-term
Summary
The district reported a modestly improved cash position and an ending fund balance of about $1.6 million, but officials warned that current cost-saving measures cannot be sustained for multiple years and that staffing adjustments will be needed if enrollment remains lower.
Port Angeles School District finance staff told the board on March 27 that February results show slightly stronger cash balances and an ending fund balance that staff described as $1.6 million, but they warned the board that temporary reductions in nonessential spending are not a sustainable multi-year strategy.
Chief Financial Officer Karen Casey presented the February financial report and noted that capital projects activity will increase as construction begins. Casey said the district "did it again" by avoiding a loan against capital and that cash levels are up compared with last year; she pointed to lower spending in MSOCs (materials, supplies and operating costs) as a primary driver of recent savings.
Superintendent Marty Brewer and board members commended staff but cautioned that the constrained spending and reduced overtime and supplemental pay cannot continue indefinitely. Brewer told the board they must balance next year's budget by August using the board-established FTE target. "Between now and August, we need to balance that budget based on that FTE," he said, and warned the board that staffing reductions during spring staffing will reflect lower projected enrollment.
Board discussion noted that payroll is now steady and that the district has reduced nonessential expenditures; one board member said that work by staff and teachers has been painful and the board acknowledged the sacrifices made by school staff.
Casey said tax collections due in March and April should continue to improve cash levels but reiterated that the district will need to align staffing to enrollment and finish a balanced budget this spring.
Ending: District leaders said they will continue monthly reporting and that next steps include finalizing staffing to match the board's FTE target and preparing the budget for adoption before the new fiscal year.
