KENT SCHOOL DISTRICT Kent School District Posts Largest June Fund Balance in Five Years After two years of intense budget recovery efforts, Kent School District (KSD) is pleased to announce it posted its largest June fund balance in the last five years. While the increasing fund balance is a positive development, what does this news mean and what does this news not mean? What does this news mean? What is a fund balance; why is it necessary? Importantly, it does mean the budget recovery efforts are working. Under the leadership of Dr. Watts, KSD implemented an unprecedented level of spending controls. These efforts involved considerable sacrifice by all members of the KSD community. Staffing reductions, travel restrictions, professional development limits, and operational expenses were all required to make this a reality. It is heartening to see this hard work pay off. A fund balance is basically the amount in your savings account; a contingency for a "rainy day." Sustaining a sufficient fund balance requires long term planning and careful budget management practices that protect public dollars. The importance of maintaining a proper fund balance ensures our district can provide educational program stability and obtain exceptional bond ratings to maintain our tax rates. The Kent School Board recognizes the value of this sound fiscal practice and has adopted Policy 6002 to "maintain a minimum unassigned fund balance of five percent (5%) of the previous year's actual General Fund expenditures." These efforts will result in our district posting a year-end unassigned fund balance in excess of five percent, meeting the School Board's goal as established under Board Policy 6002. This is a significant achievement. It will be the first time our district has met this goal since 2014 Under the leadership of the Kent School Board and Superintendent, Dr. Calvin J. Watts, the overall financial health of the district is much improved and compares favorably with other school districts in our region. What does this news not mean? First, it does not mean our work is complete. Like most school districts, KSD projects expenditures to increase faster than revenues over the next few years. Without careful planning, this can lead us back to structural deficits. In this respect, school district budgets are no different than your household budget if you rely on one-time revenues to pay for on-going expenses, eventually your bank account will run empty! GENERAL FUND BALANCE REPORT FOR JUNE LAST 6 YEARS 2014 2015 2016 2017 2018 2019 $35,000,000 It also doesn't mean KSD has "plenty of money" and does not need local levy support. Just the opposite is true. Our educational programs and operations levy is a replacement levy that continues to fund programs and services already in place. Without it, significant cuts become necessary $30,000,000 $25,000,000 $20,000,000 In the end, restoring fiscal health is not unlike improving personal health. Short-term improvements can be achieved by "dieting," but long-term results require a change in lifestyle. In KSD, we're adopting a whole new budgeting lifestyle, focused on long-term financial health. The critical feedback, support, and continued partnership from our students, staff, and community members in this process has been appreciated and continues to be critical to our success as an organization. Our operational health is crucial, for it allows us to focus on our mission to successfully prepare all students for their futures. $15,000,000 $10,000,000 $5,000,000 $0 $(5,000,000) $(10,000,000) $29,871,000 $21,944,000 $5,610,000 (000 20000 (000 92091 00 $28,527,000
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