WSD preliminary budget consistent with previous year besides loss of TIF funds

The Whitefish School District is anticipating a decrease in its general fund budget in the 2021-22 school year mainly due to losing additional revenue from the city’s tax increment finance district which sunsetted last year.

The Whitefish School Board recently reviewed a preliminary budget for the upcoming school year which estimates just under $24 million in the total district budget, a figure that decreased by around $571,000 from the 2020-21 school year. The budgeted amount for the general fund, the district’s main operating fund, is at $15.175 million between the elementary and high school districts. The general fund budget is around $300,000 less than the previous year.

In the elementary district the general fund preliminary budget amounts to about $9.946 million, and the high school district general fund is estimated at around $5.229 million.

According to the WSD Business Director Lucie Shea, the main difference between last year’s financial numbers and the preliminary budget for the upcoming school year is the lack of additional funds from the city’s tax increment financing. The TIF funds, which had provided the school district with a total of $12.5 million since the beginning of the TIF district in 1987 until it ended last year, mainly went to the maintenance and improvement of school district facilities.

“Most of the TIF money was used for facilities maintenance and improvements, and some other things as well,” Shea told the Pilot. “What we were able to do while TIF was still coming in, we saved a fairly significant amount of money in our building reserve fund.”

Shea says over the last six years the district was able to save $870,000 of TIF monies in the building reserve fund, and can use those savings as needed while adjusting to a budget that no longer includes receiving at times up to $1 million a year from TIF.

“It will certainly get tight because we've been getting TIF for 30 years,” she said.

The district did receive some inflationary increases from the state and will have other grants and funds that will help make up the difference, the district notes.

“We received some inflationary increases into the general fund so it is offset (partially),” Shea told the school board at the recent meeting. “That doesn’t mean we will be short that money; we will also be using grant monies, Covid money, the ESSER fund money and so forth. But that’s not part of this district budget.”

ESSER, meaning Elementary and Secondary School Emergency Relief Fund, was awarded to public schools from the American Rescue Plan which was signed into law early in 2021 to assist with the safe reopening of schools and sustaining safe operations of schools throughout the pandemic. The district received around 3.2 million in ESSER funds and according to Shea those funds must be spent on COVID-19 related expenses.

Several different expenses have been or will be paid with the ESSER funds, but one way the district has chosen to spend a portion of the funds is on the summer school program the district hosted through June and July.

The budget for ESSER is separate from the school district’s main budget.

There were also increases in salaries for teachers and classified staff that were approved by the school board in a previous meeting. Shea says salaries and benefits make up about 90% of the general fund budget; about $13 million of the general fund is designated for teacher and staff salaries.

The district awarded a 2% increase on the base pay for teachers, awarded a $1 per hour increase for classified staff who are already with the district, and 50 cents per hour increase for any newly hired staff members.

Other slight differences in budgeted items from the previous year mostly come in the way of items that were covered by COVID-19 relief money in the 2020-21 school year. Some expenses such as paraeducators, substitute teachers, and other extra staff members were paid through Covid funds and this year will return to being paid out of the general fund.

Also some items such as travel and extracurricular activities, which were severely impacted by the pandemic last year, are assumed to return to normal participation levels in the 2021-22 school year according to the preliminary budget.

Despite slight changes in budgeted items, Shea says the district does not have any major budget differences for the upcoming school year in the preliminary budget.

“The TIF money would be the (change) that has the most impact, all the other expenditures are pretty consistent with the prior year,” she told the Pilot.

The district decided to not run a voter-approved levy on the school election ballot this spring due to the impact of the COVID-19 pandemic on taxpayers and the district’s ability to use some COVID-19 relief funding to cover certain expenses. However the district did add a permissive levy for the building reserve fund which had minimal impact on taxpayers.

In the building reserve fund levy, the board approved a $3,800 increase in the elementary district and a $5,400 increase in the high school. Combined, that works out to an annual impact of 38 cents for a home with a taxable value of $200,000 and 80 cents for a home valued at $500,000.

The levy for the building reserve fund will help replace some of the funding that the district previously received from the city’s TIF fund.

The board will vote on the final budget in its business meeting on August 10.