After it tiptoed a thin line of potential insolvency, Chawanakee Unified School District (CUSD) has rebounded to its highest reserves since 2011, with significant investments pointed towards a bright future.
In 2009, CUSD, like most school districts statewide, was forced to dip into its reserves as a national recession led to budget cutbacks.
What started as a general fund balance of $1.65 million, calculating revenue after annual expenditures, dropped to $1.15 million in 2010, and more dramatically to $299,291 in 2013.
In a mid-year budget projection last year showcasing the worst case scenario with such costs, the district showed its reserves ending below the state’s 3% requirement for $99,911, or 1.09% based on its $9.15 million in revenues.
CUSD Chief Business Officer Patrick Jensen said that wasn’t a sign of fiscal instability, however, as economic recovery and a state Local Control Funding Formula (LCFF), signed by Gov. Jerry Brown in 2013, quickly increased the district’s balance to $803,942 - an 8.78% reserve - at the end of the year.
“We had to make some really hard decisions as far as cutting costs when reserves were declining,” said Jensen, noting at least the loss of two English teachers at Minarets High School and a full-time IT director position. “But now things are looking much better, and the board was very conscious of the budget and reacted to control costs to make sure we were in the better financial position we are now.”
Remaining challenges include high transportation costs due to the district’s rural schools, Jensen said, as well as $11 million in debt payments owed to the construction of Minarets High School that opened in 2008.
Besides those, though, the CUSD reserve is projected to increase this year, Jensen said.
Among other bright spots are improved enrollment - around 1060 students compared to 738 in 2009 - as well as the official chartering of Chawanakee Academy in September and new student programs.
One of those, recently approved by the board, is meant to fortify the district’s focus on incorporating technology into classrooms as students at Minarets High School can lease new Macbook laptops, to own, when they finish four years as a Mustang.
“We think this is a great way for students to have their own device that they can take to college or however they move on through life,” Jensen said. “It’s a new idea and we think it will be very positive for the kids.”
The four-year cost for the district is about $600,000, Jensen said, but they expect much of it will be covered either through students purchasing the laptops, or by further reorganizing some district positions, as well as debt payments, to save money.
The board also approved a 2% raise for employees in this school year, and an additional 2% raise next year, Jensen said, in order to retain the staff.
Through grants available in Proposition 39, the California Clean Energy Act passed in 2012, Jensen added CUSD schools are set to receive lighting upgrades to replace older fluorescent systems with more efficient LEDs.
“Solar will happen,” Jensen noted. “We just don’t have a timeline for that yet. To do the process right, there’s a lot of due diligence required, so it’ll probably take six to 12 months for that project to get going. But we’re actively pursuing it.”
Overall, Jensen said the district was stable but the board remains reserved in expenditures in case of future recessions.
“We’re cautiously optimistic but we’re trying to be restrained in our spending,” Jensen said. “The current growth and recovery we’ve had the last few years will have an end at some point, and we have to be prepared.”