Unionville-Chadds Ford board reviews preliminary audit showing $807,000 use of fund balance as state budget remains unresolved
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Summary
Preliminary audited results showed revenues slightly below budget and an $807,000 use of fund balance; administrators warned rising health-care costs and a state budget impasse that leaves roughly $10.4 million in state and federal funds frozen could require contingency steps such as reclassifying assigned fund balances or borrowing.
The Unionville-Chadds Ford School Board heard preliminary audited financial results Nov. 10 that show the district used $807,000 of its fund balance in the past fiscal year and faces continued pressure from rising health-care costs and an unresolved Pennsylvania state budget.
Mister Dady, presenting the finance report, said the district budgeted $105,800,000 in revenue but posted preliminary audited revenue of $105,100,000 and expenditures of $105,900,000, producing the reported $807,000 use of fund balance. "Since the 2020–21 school year our health care costs have gone up 65% in total," he said, adding that the district is analyzing options with its benefits consultant.
Administrators and board members discussed short-term steps to remain compliant with board policy that calls for an unassigned fund balance target between 5% and 8% of the budget. Mister Dady said about $1,490,000 is currently assigned toward employee severances and that moving roughly $800,000 from assigned to unassigned fund balance would return the district to the board target without changing the policy. "It's really administration's decision," he said, while noting that administration sought board guidance on levels.
Board members emphasized the need for multi-year planning. "We know administration is committed to flipping that deficit over to a surplus and building the fund balance up over time," one member said, urging proactive budgeting to offset inflation and staffing pressures.
The finance presentation also addressed broader fiscal risks tied to state and federal funding flows. Mister Dady estimated approximately $10.4 million in state and federal funds are effectively frozen by the state budget impasse and said the district could face cash-flow pressures late in the school year without a resolution. He outlined contingency options that other districts have used, including a revenue anticipation loan and a PDE debt-service loan for June debt payments, and said the auditor will present final audited results to the board in February.
Administrators asked the board for continued direction on fund-balance strategy and said more detailed recommendations tied to health-care options and staffing will be included in upcoming budget work this winter.