CFO: District narrows projected deficit to about $6 million after cost controls; MLO passage will require revised budget

Harrison School District No. 2s CFO, Cori Arcarnesi, told the board that first-quarter financials (period ending Sept. 30, 2024) show improved projections after cost-control measures and that the district will revise its budget following passage of the Mill Levy Override (MLO).

Arcarnesi said estimated year-end revenues rose in the report partly because Medicaid dollars that had not been reported in the general fund are now being included; she noted the Medicaid revenue equals Medicaid expenses and therefore nets to zero in overall fund balance. On expenditures, Arcarnesi said the district had budgeted for positions likely to remain unfilled and that increased budget granularity and targeted salary controls have produced savings: where the district had budgeted a $10.6 million deficit, the current estimate is about a $5.9 million shortfall.

The CFO explained the mechanics: salaries are estimated below budget because the district budgets for positions not yet filled; purchased services (contracted substitutes) rose in part to cover vacancies, and overall operating expenses are expected to come in under budget due to cost-savings measures. Arcarnesi said she will continue quarterly reporting and that a revised budget will be required in January to reflect MLO proceeds.

Board members asked where additional savings would come from; Arcarnesi said most remaining opportunities are in salary lines and reiterated that there is no single "magic bullet." Board members and administrators confirmed that the districts executive team has worked on targeted cuts and that the MLO revenues, expected in the spring, will reduce the planned deficit.

The financial report was moved to the consent agenda for formal approval with the superintendent consent items.