001I don't have Sarah yet, no. Should we start without her or do you want to wait a couple minutes? What do you think? >> You're the chair, you get to decide. >> Well, we have a It's 10:00 and we have a quorum, so let's get this baby going. We're calling the meeting to order. Do you want to do roll call? Okay, now? Well, I know, but what about Sarah? She can just come after. >> I'll write down when she comes. >> Okay, perfect. Roll called. >> [snorts] >> Michelle Brekken. Here. D.J. Donnelly. >> Here. >> Stephanie Edelman. >> Here. >> Randy Heideman. >> Here. >> Sarah Speer. John Ward. Do we have a quorum? >> All right, let's do the pledge. Pledge allegiance >> to the flag of the United States of America and to
002the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. >> Great. Uh we need approval of agenda. So, do we need to do that? >> I'll make it. >> Stephanie, second. >> I'll second. >> Shall All in favor, aye. >> Got to do a roll call. >> I'll roll call. >> Michelle Brekken. >> Yes. >> D.J. Donnelly. >> Yes. >> Stephanie Edelman. >> Yes. >> Randy Heideman. >> Yes. >> All in favor. >> Due to this is a special board meeting, there will be no public input allowed at this meeting. First thing for action is approval of the first revision of the 25-26 budget as presented by Marcy Lord. >> So, in your packet, there is a document that's multiple pages that goes into more detail, and then
003there's also the presentation slides, which I will be going through, which is a very brief synopsis, and it really focuses on the general fund. So, this first slide is the first revised budget, which is our starting point for the preliminary budget for 25-26, and we are focusing on the 25-26 revision. It's very late, and just with the transition in the our office, that's why it's so late, but we do want to get it in there because when we talk about the original or preliminary budget, that's there's a lot of unknowns at that time, so that first revision then takes into account the student count and the staffing that we currently have at the time. Um that I also put in there the 24-25 audit so you guys could see what the revised budget was compared
004to the audit for [clears throat] 25-26. And when we compare the two, the primary difference is a $2.8 million deficit in unassigned and the actuals was a $800,000 deficit. And we've talked about why those differences are when we presented the audit. And then community service had a projected deficit of $188,000 which actually ended up being an $80,000 excess. Well, just a kind of a recap of how we ended the year versus um 24-25. I know it goes back a little ways. >> What was the last thing you just said? Is that about community ed? >> Yep. >> You said that they were they were in the black. >> Yes. >> Great. >> Yes. >> Perfect. Good job, Henry. >> So, then we look at 25-26, what we used for assumptions, 2.7% increase on the formula
005which was because of the inflationary factor. And then we were going to be projected down a projected uh students. There was a decrease in compensatory which I'll talk about later uh after we approved the budget then the legislature did uh did a hold harmless or and we actually saw a million-dollar increase on that similar to this year where we were projected to uh have a decrease and then they did some legislative changes and we we don't see as big of a decrease. Same thing happened again. Um we also had in the assumptions an increase in salary and benefits and then all adding the PML or the paid medical leave for a half a year that was started January 1. And then spending down fund balances in capital, compensatory, and learning and development. And then adding
006back those cares positions. So, 24-25 we was the last year of cares and we had to put all those positions back into the general fund. So, that was an add as well. So, those all those assumptions went into the 25-26 preliminary budget. And our enrollment projection was 5,630 students for 25-26. And then when we >> [clears throat] >> looked at the what that meant for the unassigned, it was about 2.2 million for 25-26 preliminary budget. Uh >> [snorts] >> with a beginning balance uh is what was carried over from the preliminary budget of 24-25. And then with the revision, we put in actuals because we know what the audit is. So, what's in the first revision? What What are What I'm presenting to you guys today. There's a decrease in enrollment of 28 based on
007the October 1 count. The compensatory revenue did go up as I had said because the budget was approved before that change happened. There was an update to the federal and state awards. One of the big ticket items in this revision was special ed revenue went up over a million dollars. That is why you're going to primarily why you're going to see the unassigned balance go uh deficit go down. >> [clears throat] >> We updated salary and benefits, which is super time intensive. That's the biggest part of our budget. And I just want to share for an example, adding that paid medical leave, the state wanted that tracked separately in its own object code. That added 536 new account codes. >> Oh, god. >> Because we we have account codes for restricted accounts, unrestricted accounts, and
008then you add that object code to all of those. That's 536 new account codes. So, [snorts] it's a lot. >> They're all going into one thing. >> They're all going into >> out of 538 deals to put it in one big pot. >> Yeah. So, then >> Once you do it once, it's going to automatically do it for you, right? >> It's it's they're separate lines in my in my world. >> Marci, what >> to have [snorts] to get rid of that. >> I wish I could. >> What's the financial impact of folks taking family medical leave? >> So, right now we're remitting about $40,000 back to the company. >> Okay. >> So, half of that's the district and half is the employees. >> Okay. >> So, the 500,000 was half and half. >> Yeah.
009>> The 250. >> Yep. Uh 500,000, where did you get the 500,000? >> you said that we had spent about 500,000. >> No, I added about 500 codes, but Yes. >> Oh, that was about 40,000. >> 40,000 we're remitting back to the insurance company every month. >> So, every month that's >> Yeah. >> So, half's ours. >> Just curious, is there a count of how many people took advantage of family medical >> I don't have that count. Um Jason would have that count, but we can get that. >> Okay, get me that Yeah, just curious how >> That'll be the real cost. >> Mhm. >> That's where it's really going to get expensive. >> Yeah. Anyway, I thought we digress. >> No, it's good They're all good questions cuz it's new. >> Yeah. >> Uh
010and then we did have increase in services for hard-to-fill positions, uh SLPs, interpreters. If we can't fill those positions, we do end up hiring contracted services for that. And then there was a decrease in the PSEO budget line item with the new agreement, which was awesome cuz we've seen that slowly tick up in the past few years and we were able to actually decrease that with the new change. So, that was awesome. >> With what new change? >> They redid the contract so that now um Peter Hasley would be able to explain this a little bit better, but they they did it as a group Pequot. Um >> Or a consortium that made an agreement with CLC. >> Okay. Yeah. >> So we were able to save some money. >> Yeah. Okay. Uh, and then
011there was a uh so we booked receivables for the prior year and if those receivables come in higher, I can recognize that revenue in this year and there's about 500,000 in Gen Ed receivable that I could book to this year 25 26. But I just want to note that then I have to take that out of 26 27. It's not like something that's going to carry forward multiple years. So with the first budget revision, now we're at 5,602 not the 5630 that was in the original budget for enrollment. So with the first budget revision, the beginning balances, like I said, are updated to what was the audit for 24 25 and then we look at what's in the budget for the revision. And there is a couple lines added. Q Comp is now restricted. It
012was a assigned previously. And then the American Indian Ed is now a restricted fund balance as well. So those are two new lines. So a comparison of the preliminary budget with the first revised budget, uh the deficit went from 2.2 million in unassigned to 1.3. And then the overall deficit in the general fund was is about 426,000 which includes the restricted funds. >> What kind of American Indian the new the new line is dollar-for-dollar revenue expenditures. The rest of them are all, you know, they're not exactly the same. >> Right. So So that one we can't carry over. So if we don't spend it all, then it goes back to the state. I think there's going to be a change in that, but for right now that's how it works. So, if we don't spend
013it, then it goes back to the state. So, no matter what, if we spent 160,000, then the revenue is going to be 160,000. >> So, is that all payroll? >> Uh payroll and supplies. >> Yeah. >> They they do try to spend it. That's what they When I went to that meeting >> seem to have a lot of problems spending around here. It's spending we're pretty good at that. >> Cuz they were going to try to hire another part-time person just so they could spend everything. >> And that 174 is the award allocation. So, I don't know what the award allocation will be for this next year. You guys will see that same number in the 26-27 budget. So, the unassigned fund balance um So, the state of Minnesota recommends 5 months or less and
014this is a change [clears throat] from what I've previously shared. I did do some research after I got questioned on that and um it is with school districts you can have less than that based on how we get paid, but it is critical for cash flow and credit ratings. So, the current policy is 10% and we are going to be at 12.8 with this revision, which is [snorts] a month and a half of operating expenses. Not very much. So, [clears throat] what's next? This revision was our starting point for the 26-27 budget and then we apply all the assumptions. So, for example, the gen ed formula is a big one, enrollment is a big one, and then um special ed and federal levy, and then of course our staffing and services and supplies are looked
015at. So, is there any questions on the revision? >> I don't think so. Does anybody have any? Then then we're looking for a motion. >> I'll make a motion. >> I'll second. >> Kelly. >> Roll call. Further discussion. >> Did you vote on the layer? >> Yes. >> Stephanie Edelman. >> Yes. >> Mandy Heidemann. >> Yes. >> Michelle Brekke. >> Yes. >> All in favor. >> All right. Marcy, you're up. >> All right. >> 26 27. >> Yes. >> Here we come. >> I struggled to put this to work last time, so Ryan may have to come and help me. No, it's not. Sorry. >> Oh, I thought it looked like you had it. >> Looks can be deceiving. >> While she's pulling that up, I can share we've had 56 people apply for paid
016family medical leave since January 1st. >> 56? >> That's a lot. >> That seems like a >> Yeah, on track for maybe 100 out of the thousand on payroll, so about 10%. That's terrible. >> [clears throat] >> Oh. >> It's going to go off. >> It needs to be fixed to make it >> And it's only going to go off. >> I'm sure. >> Well, it ain't going to go down. >> I'll go through it. Okay. >> [clears throat] >> Thank you. >> Yep. >> All right. So, for the 26 27 budget, you guys are going to hear a lot of the same things. So, our starting point was the 25 26 revised budget. The screenshot is the general fund, which is a deficit of about 1.3 million in the unassigned. As you guys know,
017we focus on that cuz that's the one that we have is unrestricted. We can use it for anything. There are other categories, and if you have any questions on those, just let me know. Great. Here you go. Um so, for assumptions for from the 25 26 budget, we have 2.7% on the formula due to the inflationary factor again. So, we had that in 25 26, now we have it again in 26 27. We are projected to be down 182 pupil units. And then the compensatory, even with what the legislature did for us, we still will be down about 900,000. So, it or 15.3%. So, that's in here as well. There's going to be an increase in the levy. And then a reduction of So, we have to set aside 2% for staff development of our
018revenues, but the there was an MOU, so now that's only going to be 1%. So, the other 1% of those revenues just goes into the general fund. >> Marsha, [clears throat] let me >> Yeah. >> make sure that I understand. We're talking about a 2% increase in general aid formula. Um is it 2% or did it increase to 2.7%? >> It's a 2.7% increase. >> So, what is it total then? >> So, it's now 7,000 I should have wrote that down. >> last year. >> And then add 2.7% on it. Easy DJ's going to do the math. >> That 2.7 is by law. >> Okay. I just wanted to make sure because we're >> 148 [snorts] >> 7682 I almost think they're trying to sell something. >> 89 >> [laughter] >> They always round up.
019We don't get them. >> I'll get them. We get 7683. >> Yeah. So, that would mean that our enrollment projection is going to be about 5,420 with 333 in kindergarten. [snorts] And again, we'll look at that with a revision for next year, what what October 1 counts will be, but that's our projection right now. Just want to point out um we talk about how the birth rates are going down. In the birth year 2014, there were 695 births in Crow Wing County. In 2024, there was 599. So, 96 difference in the births in 10 years. >> Is is the decrease in enrollment um that's projected, is that strictly based on kindergarten versus seniors? >> It's It's that and >> What's the other one? >> It also takes into account the transition between grades. So, it
020looks at our historical data and says, "Oh, and from fifth to sixth, you typically lose on average, you know, X number." And it'll It plugs all of that into the formula. Yep. >> Just one thing about her uh 26-27 estimated enrollment, you go back to 2019, it's almost 2,000 kids. That was 7,180 or something like that. >> Crazy. That's a lot. >> [clears throat] >> What's also kind of interesting >> it. No reason to whine about it. >> What's also >> Go ahead. >> We can't fix the birth rate, but we can fix a lot of that. You didn't have 7,000 kids from Brainerd going to school here, Peter. You had about a thousand people that are open enrolling here into Brainerd schools. So, COVID was a game changer. >> Mhm. >> And we got
021to get back on track. >> So, for >> What's kind of interesting, I think I pointed this out when I seen I and I were talking earlier, we had got done a little bit earlier. To me, what's really interesting for 26-27 between fourth and fifth grade, you know, we're going from a minus 40 in comparison to 25-26 to 26-27, but then you go to grade seven or grade five, excuse me, and we're up 71. Well, that's a big swing. Why Why is that? >> I don't know. Makes >> makes >> this I mean, you This is kind of a formula, right? So, you're kind of like >> Yes. >> Yeah, but it's just kind of >> Right. It's just taking data. >> Yeah. >> I would have to keep them. >> So, then we So,
022those are the revenues in um the budget, and then we look at the expense assumptions. And there's an increase in the salary um of and benefits and contracted services known and projected. And then uh FTE reductions, additions, and replacements are all in there as of the last board meeting. So, any of the resignations or retirements that you saw on the agenda since January have been are in the budget. With um estimates on replacements, and so you guys know, we always do worst-case scenario. So, if they um would take family and family medical and dental, that's what's in the budget. They may not, you know, that is a That is something then we'd look at at the revision. If they did not, then we would adjust for that. Or maybe they were hired at a lower
023level or a higher level, that would be in the revision. Um And then um one thing that we did in 25-26 is we moved all of the tech staff to capital to spend down that fund balance and try to save on the general fund. And we talked about moving that all those back in this budget. We did still have some carryover in the capital fund balance, so I moved out two of the FTE. And so, just keep that in the back of your mind for next year, we would then have to move the rest of them back. So, it's it's helping the general fund a little bit longer. And then we also had a decrease in the supplies based on student count. So, we'll continually do that every year. As enrollment goes down, we have
024a calculation, supplies will go down. So, the preliminary budget um with all the assumptions, the unassigned deficit is about 3.4 million. And uh staff decreases from 920 to 450 staff development. So, when you look at that specific line, um it's about 1 2 3 4 from the bottom. The revenue goes from 920 some thousand to 457,000 because of that 2% to 1%. So, that's really the only major change. I noticed our screen is not updating. Sorry, guys. It's updating on mine, but not >> So, we're still going to spend the same amount, we're just not taking it in. So, you're spending down that balance is what you're >> Yeah, and they did make some reductions. So, >> What is it used for? >> It >> I know it's staff development, but what is staff to
025explain? >> So, they may be doing curriculum writing. There could There is um presenters. There is on the staff development days, like whatever >> Continuing ed. >> Yes. I'm trying to think of some of the bigger purchases they have. We have software that's I think almost 50,000 that we use to track all of our staff data or licensing and all that. Um so, there's some fixed costs and some costs that vary. Thank you. But, they did [clears throat] make some reductions in anticipation of this reduction of their revenue. So. Cuz I think the budget was around 900,000 for 25 26. >> Whose staff? Is that Is that the educators? >> No. >> All across. So, there's Yep. We have set asides for interpreters, secretaries, EAs, like they The majority of it is the educators, but
026there are other pockets that are used for other staff. >> Got you. >> Great. And then again, the unassigned fund balance, the policy is 10%. With this, the projected balance would be about 9.3%. We'd be below our policy. And then looking ahead, um, with 25 26 revised budget to 26 27 uh, original budget, we do carry forward the state aids. Um, those don't get updated until that first budget revision. And then actuals versus estimates of expired contracts would hopefully be in that revision if they are settled. And then, um, the potential operating referendum, this is looking even further ahead. That would be in 27 28 if that were to pass. Uh, other funds, so fund two in the budget revision or in the 26 27, this is why having them both is a little I'm
027I apologize. It should It would be nice if they were separate. Um, there are no known changes at this time, um, as far as revenues goes. We did adjust a little bit on the expense side for any salaries. Community service fund was updated based on the current programming, um, from the director. And then the building construction fund was updated with any planned projects. There was some carryover from 25-26 of projects that weren't done. So, when you look at that balance, it looks like we're going to be around a million. It's probably going to be more than that. And we'll know that when we close out 25-26. The debt service fund was updated with any levy or bond payments. And then the OPEB, there really wasn't anything any major changes in that fund. Any questions on
028the preliminary budget or original budget? >> What uh what What was the main cause for the delays? I mean, I know you had all these lines that you had to adjust for and put in >> Yes. >> for various things. Uh Is that the biggest reason? >> Yes, it's staffing. So, we have, you know, our new accountant. And then just the amount of time that we it takes to get all these lines entered is it's a lot. I mean, it's over 7,000 lines. So, to enter each one, um you could just plug in a number, but with all the restricted accounts that we have, so like if I put in an estimate of the salary and benefits for next year and didn't apply it to all the restricted accounts, then we would have major differences
029in our budget. So, I'd rather I'd rather be closer. >> Is that something that's been that will be alleviated going forward or is it going to take a lot of extra effort? >> It's It's ongoing. Like this is we do this every year where we have to enter all of it. I um I would like to look at a module in Skyward potentially that would eliminate the use of an Excel spreadsheet. That is something that I'm hoping to look at. >> Why? What Are you looking at someone other than Skyward? >> We have talked about um so Skyward right now we are we're on the SMS 2.0 version and there's a Q version. Um I think looking at that I would I I'm hoping too that maybe there'd be some improvements, but we don't have
030that scheduled out with all the new staff. I don't know if I could go through a conversion right now. Like that that's a lot of time, too. So. >> Yeah, but there aren't very many products out there that are safe. >> mid-market software in public schools. Uh smaller districts will hop in and like some consortium type stuff that's even less robust. And then bigger districts will get into the SAPs and you know, some of those bigger ERP things you might see in the private sector, but those are boo-boo dollars, so. >> And MDE has requirements of what programs you use, so I can only use Skyward Smart. Um there's a list in the UFARS manual. So I can't use a QuickBooks. Like that's not something that's allowed by MDE. >> There's Yeah, I I appreciate
031that. You can't just use whatever you want to deal with Chevrolet or Ford or Chrysler or Toyota either, so it's the same thing. But there are 15 different providers and they all have different pricing. So you shouldn't be I don't know what kind of contract you're on, but we should be shopping them. We should be seeing what's out there. Cuz to think that you're still using Excel spreadsheets for anything more than just on your little projects that you have >> Yep. >> I understand an Excel spreadsheet's a great tool, but to think that you're actually running a school district of this size of 100 million bucks on an Excel spreadsheet is a little bit frightening. >> Yeah. Oh, yes. I [laughter] don't disagree with you, DJ. >> I mean you just change one little thing
032and it changes everything. It's not a rule. >> Yes. >> Well, we need a motion to accept those. >> I'll make a motion that we approve the 2026-2027 budget. >> I'll second it. >> Any discussion? >> Um I would add to your motion that the original budget. >> Yes. That I said. >> What does that mean? >> Well, Michelle's motion was just to approve the budget. I'm I'm being more specific in saying the original budget cuz that's what we've been talking about. That's all. >> There you go. >> Just words. >> I thought I said that, but maybe I didn't. >> You may have. I wasn't >> I didn't call it the original budget. >> That's what it um that's what it is in Skyward is the original budget. >> What does Skyward those days
033again? >> [laughter] >> What Skyward says. It's a better deal. You better have a roll call for I get trouble, Julie. >> Yes. Stephanie Adelman. >> Yes. >> Randy Heideman. >> Yes. >> Michelle Bracken. >> Yes. >> Didier Donlingerie. >> Yes. Thank you. >> Thanks, Mark. >> Thanks. >> Thank you. >> The next deal up is the approval of the MOUs uh regarding the GOP ones. Does anyone have a motion? >> I'll make a motion. Make a motion. >> So, you can just sit in the front row here. Uh do we have a second? >> I'll second. >> Um What's that? Stephanie made the motion. Uh discussion? >> No, they all signed. >> Roll call vote. >> Randy Heideman. >> Yeah. >> Michelle Bracken. Yes. Didier Donlingerie. >> Yes. >> Stephanie Adelman. >> Yes. >>
034There you go. All right, that passes. We need a motion to adjourn. >> I'll make a motion. >> Okay. >> I'll second. >> Okay. Roll call Billy. >> I reckon >> Yes. >> Did you done playing yet? >> Yes. >> Hi. >> [laughter]