Bleak financial future predicted for schools

Steve Lund, director of business services for the Brainerd School District, told School Board Finance Committee members Tuesday that the district may be "in the long haul for a bleak financial future."

Lund analyzed the state's financial outlook and its impact on the school district over the next four years. Lund said the district could experience a reduction in state appropriation for Fiscal Years 2012-2013 from anywhere between zero and more than $5.36 million in the next biennium.

Lund said the district needs to be prepared.

"The decisions we make today are going to play into how we stack up our fund balance in 2012-13," said Lund. "We have to be very cautious and very guarded for our unreserved fund balance."

"I know it's cliche, but we're really looking at a perfect storm coming up in FY12," said board member Bob Nystrom.

Lund said the district could be looking at a $1.5 million budget shortfall in FY12 and a $3.57 million shortfall in FY13 after the district's operating levy of $199 per pupil unit expires in 2012.

The finance committee learned from Lund that once the school board July 8 approved its recommended plan to construct a joint parking lot with the Brainerd Family YMCA, school representatives will go before the Brainerd City Council July 20 to present its plan.

The district is required by the city to build a 55-space lot by the end of the year at Washington Educational Services Building. Lund said the district will ask the city for variances so the joint lot may be constructed.

The committee recommended board approval of adding Unity Bank as an approved depository institution. Board member Reed Campbell abstained from the vote.

The committee heard a presentation from Bremer Bank representatives on its plans to manage the district's OPEB Trust.

JODIE TWEED may be reached at jodie.tweed@brainerddispatch.com or 855-5858.