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District finance reports positive midyear variance; new long-range forecast shows sustainable fund-balance path
Summary
Finance reported stronger-than-budgeted revenues and projected a smaller use of fund balance for FY25 than budgeted; a new long-range forecasting model projects a $168 million fund balance by 2029 under current assumptions and will be used to test policy choices such as compensation changes and debt scenarios.
Finance staff reviewed the December monthly financials and introduced a new long-range financial-forecasting model that incorporates historical data and scenario analysis across revenues and expenditures.
Daniel Prentiss said December revenues were tracking as anticipated and property-tax receipts in January further strengthened revenue projections. Midyear, the district expects to use less fund balance in FY25 than the $63 million budgeted — staff currently project using about $36 million — yielding a better-than-budget outcome. Expenditure-side reconciliations also indicate salary-and-benefit savings for the year.
Prentiss introduced a new in-house long-range forecast spanning FY25–FY29 that uses historical drivers (assessed value, enrollment, CPI, etc.) and allows sensitivity analysis (for example, showing the fiscal impact of larger teacher compensation increases). Under the model’s baseline assumptions (no millage change and current assumptions for CPI and staffing), the district would close FY29 with about $168 million in fund balance while using modest amounts of fund balance in intervening years.
Committee members asked how the model treats pension, enrollment, and the later expiration of the sales-tax capital program (Phase 5). Staff said pension contribution increases have paused relative to recent years and that the model includes enrollment projections and can be used to test referendum/debt scenarios; staff cautioned that capital needs after sales-tax expiration would likely require bond financing or a new referendum and would not be covered in the GOF model by default.
Ending: Staff said they will refine the forecast during upcoming budget workshops, produce narrative explanation of key charts and assumptions, and use the model to quantify tradeoffs for compensation and capital options.
