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Brainerd board approves first revision to 2024-25 budget, cites $2.8 million unassigned balance
Summary
The Brainerd Public School District board approved the first revision to the 2024–25 budget, increasing the district's unassigned fund balance to about $2.8 million and noting the balance remains below state and board reserve recommendations.
Director Marcy Lord presented the Brainerd Public School District's first revision to the 2024-25 budget and the school board approved the revision by voice vote during a special meeting called under Minnesota Statutes 13D.02.
The revision updates the district's general fund with audited beginning balances and revised revenue and expense assumptions. "We're looking at about a $2,800,000 in the unassigned," Director Marcy Lord said, noting the revised unassigned fund balance is higher than the preliminary estimate of roughly $2.3 million because year-end results came in under budget.
The nut of the presentation was that the district closed the prior year with more unspent dollars than expected. Lord said several restricted lines were added in the revision'including literacy aid, student support personnel aid and teacher compensation for training'and the revision incorporated updated enrollment (adjusted pupil units), a 2% formula inflation factor, increases in compensatory and special education funding, and negotiated salary/benefit changes.
Board discussion emphasized the size and composition of the available fund balance. Lord told the board the state's recommended reserve is three months of operating expenses (about 25 percent), while the district's board policy sets a 10 percent reserve. Under the revised figures, the district's projected fund balance is about a month and a half of reserves, below both the state recommendation and the board policy target.
Board members asked for clarifications about restricted accounts and Long-Term Facilities Maintenance (LTFM) planning. Lord explained the restricted accounts are intended to cover planned uses such as LTFM projects and operating capital; those balances provide time to respond if state funding changes. She said parts of the higher-than-expected unassigned balance reflect budgeted projects that were not spent during the prior fiscal year and increased interest earnings noted in the audit.
Lord described the projection method used for enrollment and revenue: it applies historical October 1 counts and final average daily membership (ADM) to estimate adjusted pupil units. The revision also incorporated a first-semester bill for contracted student services that was higher than projected and several updates to salary and benefit accounts.
The board voted by voice to approve the first revision of the 2024-25 budget. No public comment was taken at the special meeting according to the meeting format explained at the start of the session.
The district will use this first revised budget as the starting point for the 2025-26 preliminary budget work, which will include updated enrollment assumptions, formula inflation factors, removal of CARES federal funds from the base, and any known changes to the local levy and employee contracts.
Less-critical details: Lord thanked accounting staff and noted the revision required reviews of thousands of revenue and expense lines. She also noted some site carryovers are added to the revision as beginning balances but may not be spent in the current year.
