District finance presenter: operating surplus before transfers, net deficit after construction transfers; interest and transportation affect bottom line

Corey, the district finance presenter, told the board the preliminary FY25 operating budget shows just over $79,000,000 in revenues and $74.8 million in expenditures, yielding an initial operating surplus of about $4.2 million. "So, our initial look at the surplus versus deficit is at 4,200,000.0," he said, then explained that after transfers out for construction and debt certificates the net position becomes a deficit of roughly $2.86 million.

Corey highlighted drivers of the changes. He said timely second-installment tax billings and current interest rates increased interest revenue, which he estimated at roughly $500,000 given current market rates and PMA investment projections. He cautioned that market movements could change that outlook and noted the district budgeted conservatively on interest-rate expectations.

On transportation, Corey reported ridership is down compared with the prior year and that the district eliminated "one and a half routes" as a result of lower demand. He said the district typically waits a couple of weeks after school starts to process wait lists and that ridership often increases after Labor Day; he pledged to return in fall with more detailed ridership, route and subsidy numbers.

Corey also described internal reclassifications and increases: O&M supplies and materials increased about $287,000 (including roughly $97,000 for utilities); the budget moved about $93,000 from capital outlay to supplies and materials for more accurate classification; and the transfer from O&M to capital projects increased by $193,000 to reflect planned summer projects and conservative estimates for next summer.

Board members asked how the operating and net deficit figures reconciled and whether the district could avoid using reserves for construction if the top-line surplus improved; Corey said the top-line operating surplus is the key ongoing measure and that district practice is to maintain at least $1 million positive operating surplus because of a committed $1 million transfer for debt service. He said he will provide an end-of-year reconciliation and return with updated ridership/subsidy numbers, and that a formal resolution on annual tax compliance will be presented for board action at the next meeting.

Next steps: Corey will finalize fiscal-year reports and return in November/December with audited variances and the requested ridership/subsidy update.