District Strategic Framework Financial Goal

District shall establish short-term financial stability and long-term fiscal solvency.

Over several months during the 2012-2013 school year, I was very fortunate to facilitate one of the five Strategic Framework goal groups.  A dedicated group of individuals was willing to spend their free time to help Saline Area Schools develop an Action Plan to meet our goal of short-term financial stability and long-term fiscal solvency.  As a group, we developed the following Action Steps:

1. Develop a five year forecasting plan
2. Continue to investigate ways to reduce expenditures, while maintaining the core mission and values of Saline Area Schools.
3. Continue to investigate ways to increase revenues, while maintaining the core mission and values of Saline Area Schools.
4. Return Fund Balance to 5% and continue to work toward 10% Fund Balance.
5. Develop and implement a financial reporting strategy to increase community financial literacy and engagement.

Since that time, several steps have been taken to implement these action steps:

 Five Year Forecasting Plan:

A five year forecasting tool was developed and presented to the Board of Education on November 26, 2013.  As we develop our budgets for future years, we will be able to see the long term impact of projected changes.  There are several areas on both the revenue and expenditure side where we can make budget “changes” and see that impact – Foundation Allowance, Student Enrollment, Employment Costs (salary, retirement, health benefit costs), Utilities, etc.  As we’ve seen in the past five years however, the landscape of school finance is ever-changing and this tool cannot predict what those changes will be.  As we begin to use the tool, we will continue to refine it and improve its value in the decision-making process.

Investigate Ways to Reduce Expenditures:

Steps have been taken to reduce our trash disposal costs by “right-sizing” our trash dumpsters and pick up schedule.  We will also be increasing our push for recycling, which should reduce the demand on our trash dumpsters.  

Investigate Ways to Increase Revenue:

We continue to take advantage of all revenue available to us through traditional sources and we are working to initiate new partnerships and strengthen existing partnerships that can support and expand the curriculum offerings for our students.  Additionally, we are auctioning off unused inventory that was being stored at Houghton Elementary and we are evaluating a variety of options regarding the Houghton property.

Increase Fund Balance to 5% and work towards 10%:

As of June 30, 2013, our Fund Balance stands at 4.06% (of total expenditures), up from 2.32% in 2011-2012, so we are on the right track.  We continue to watch our revenues and expenditures with the intent of adding to our fund balance and will continue to apply one time revenues toward building our fund balance.  For example, in 2012-13, we sold a parcel of land at the corner of Woodland and Maple and added $519,000 to our fund balance.

Increase Community Financial Literacy and Engagement:

This blog was started during the 2012-13 school year and the History of School Funding, Basics of Fund Accounting and the Importance of Fund Balance and the Operating Millage Renewal have been covered.  The Finance Office has also started a series of e-mails to all staff, providing various information that may be helpful to them, such as Finance Office policies and procedures, updates on our conversion to a new financial software system, and information on school finance and our financial statements.  We have also opened a Twitter account and blog posts are uploaded to the Saline Area Schools Facebook page.

Next Steps:

Action Steps 2 and 3 call for the development of consultative groups composed of interested community and staff members.  These groups would meet 2-4 times annually to discuss possible ways to reduce expenditures or increase revenue and recommendations would then be presented to Central Administration for consideration.  Ideally, there will be one group for expenditure reduction and a second group for revenue creation, but depending on community and staff interest, it could be one group.

Additionally, Action Step 5 calls for the development of a similar consultative group to assist with sharing financial news with the community.  This group would provide potential topics that are of interest to the community and staff, develop ways to “get the word out” and provide feedback on how well we are sharing news with the community and staff. 

Toward that end, I am looking for interested community and staff members for these consultative groups:

• Expenditure Reduction Ideas
• Revenue Creation Ideas
• Financial Literacy

If you have some great ideas you would like to discuss and are willing to attend meetings 2-4 times per year in any of those areas, please contact me at warnerj@salineschools.org or (734) 429-8012.  I would anticipate our first meetings to begin in January/February, with future meetings scheduled on a quarterly basis.