HSD's Operating Budget Deficit Reduces to $496,000

Tuesday's Hazelwood School District Board of Education meeting was filled with people asserting the positive happening at the district.

Terms like moving forward were used, and although the district has had a shaky few months with superintendent firings and surplus funds discovery, the meeting proved to be a good one for the district.

One subject of which taxpayers are most interested is the district's budget update. It was the first update of 2012-13 fiscal year budget. It was also the first discussion of school funds since a $9 million surplus of funds was discovered in August, followed by a 5 percent raise for teachers and other employees in the district.

Dwight Lindhorst, assistant superintendent for finance and facilities, presented the budget update, the first revision of the budget. Typically the budget is revised on a quarterly basis.

The district received $13.8 million in state and federal grants that were added to revenue, according to Lindhorst. There was $13.2 million in expenditures added.

The original operating budget ended with a $2.9 million deficit, but this  updated budget now puts the deficit at $496,000, according to Lindhorst.

Board member Mark Behlmann asked if operating on a deficit was normal, to which Lindhorst said no it's standard to have a balanced budget.

Behlmann also asked if the district can use reserves to balance the budget, which it can. But Lindhorst warned using reserves doesn't make a budget balanced.

"You can use reserves, but only for so long," he said.

Board member Brenda Youngblood asked if Lindhorst felt he could benefit from professional development, to which he said the finance staff and he do on a yearly basis.

For some time, Lindhorst has been warning the economy is having a significant impact on the district's operating funds.

"As I’ve been saying over the past few years, we knew starting this (2011-12 fiscal year) we would have a funding cliff with state funding and also with drops in assessed valuation," he said at a June meeting. "So we knew this was coming and had been planning for it."

The majority HSD's state funding is received through basic formula apportionment. The budget reflects approximately $2.5 million less in state revenue from that formula compared to the amount the district received in the 2011-12 fiscal year.

Couple that with a decrease in assessed valuation of property in the district, and a reduced business sector to add to the tax base, and one can see where drastic changes could occur in the budget.

Interested in what's being discussed at the Board of Education's next meeting? Click here for a rundown.