Dan Emerson, the district's chief financial officer, told the Bend‑LaPine School Board on Jan. 14 that the second-quarter financial update (actuals through Dec. 31, 2024) shows a $1.4 million downward revision to revenue projections but also roughly $3 million in projected payroll vacancy savings, leaving the district with a larger-than-expected beginning fund balance for next year. The board voted 5–0 to accept the district's annual comprehensive financial report for the year ending June 30, 2024.

The district's revenue projection was lowered largely because assessed value growth used in the budget (projected at 5.1%) is tracking at 4.6%, Emerson said, a change that reduced a prior projection by about $850,000. He also reported a reduction in the district's state school fund projection—"about $600,000," he said—even though those state revenues remain roughly $300,000 above the budgeted amount for the year. Emerson attributed some state school fund variance to enrollment changes measured between Oct. 1 and Jan. 1.

Why it matters: the district's reserves and cash flow are central to operations because payroll and other obligations can create tight cash positions during summer months. Emerson told the board the current reports show an estimated ending (next year's beginning) fund balance of about $24 million, roughly $1.6 million higher than the Q1 projection and above the district's 5% reserve policy.

Key figures and drivers
- Revenue revision: about $1.4 million downward from the Q1 projection; roughly $850,000 of that tied to lower-than-expected assessed value growth.
- State school fund: projection reduced (Emerson said "about 600,000") but still above budget by roughly $300,000.
- Enrollment: Emerson reported recent net enrollment shifts, noting changes at the school levels (he cited decreases in middle- and high-school counts and a small increase at elementary).
- Payroll/vacancy savings: Emerson projected roughly $3 million in salary-and-benefits savings this fiscal year from unfilled positions.
- Ending fund balance: projected at about $24 million (approximately $1.6 million higher than Q1 projection), which exceeds the district's stated 5% reserve target and will require board discussion about redistribution.
- Investments: about $62 million of operating funds are invested in short-term Treasury bills (staggered maturities over 3–5 months) earning an average yield-to-maturity Emerson described as about 4.18%. Bond funds of about $58.8 million are reserved for capital projects and mature within 12 months.

Emerson also told the board the annual audit produced an unmodified (clean) opinion, the highest standard auditors can give. The board voted to accept the annual comprehensive financial report for the year ending June 30, 2024.

Board action
- Motion: "I move to accept the annual comprehensive financial report as presented." (mover: Director Shirley Olsen; seconder: Director Cameron Fisher).
- Vote: 5 in favor, 0 opposed.

Context and next steps
District leaders reminded the board that projection changes do not automatically mean long-term deterioration but do require continued attention. Emerson noted that while the Q2 projection shows a healthier beginning fund balance for the coming fiscal year, longer-term forecasts still show pressure from rising costs (including PERS liability) that could reduce reserves in subsequent years. Board members asked for additional breakout detail on FTEs and employee counts by classification; staff said they would provide more detailed FTE information on request but cautioned about current manual systems for position control.

The board accepted the annual comprehensive financial report in the Jan. 14 meeting, and CFO Emerson said staff will provide requested follow-up details on FTE breakdowns and a more detailed explanation of changes in net position.

Ending
The district plans follow-up reports in coming quarters. Emerson and other staff said they will return with more detailed FTE and net-position explanations and continue quarterly budget monitoring.