Marysville School District’s financial forecast looks more positive than what was previously predicted in October 2018.
District Treasurer Todd Johnson said at a meeting Thursday the district’s financial forecast predictions for upcoming fiscal years have changed since last year. He said the district has been able to extend its need for a new money levy by a year by injecting TIF revenue dollars into the general fund.
“It’s a very strong forecast,” Johnson said. “To have a strong, almost $11 million ending cash balance at the end of 2023, without even asking for new money levies since 2008, I think we’re very fortunate.”
The district had two levy issues on the ballot in November that affected this. One was a 6.56-mill renewal levy and the other was to be granted the ability to switch from an expiring bond levy fund to its permanent improvements fund. In a sense, voters put new money into the permanent improvement fund, increasing its balance.
To start, the forecast predicted in 2018 that the district would end with a cash balance of $24.49 million in the general fund in 2019. Now, that total is $25.94 million for this year.
Also, it was predicted the district would end with a $912,034 balance in the general fund in 2023. Now, the new forecast shows the district will have a safe balance of $10.9 million in 2023.
Johnson said this growth was caused by three factors: a higher student enrollment leading the district to get “the most amount of money we can” from the state, totaling $138,000, the levy renewal “pumping” TIF money into the general fund, totaling $1.7 million each year, and interest rates on the school’s investments increasing, which he believes is projected to be $600,000.
He said the $10 million increase from the previous cash balance prediction for 2023 was driven by those factors. He said they will impact and “flow through” every single year as being recurring revenue sources.
“The impact of adding those three things into this year was about $1 million,” Johnson said. “When we’re looking all the way out to 2023, that’s five years of the impact of those three factors.”
Johnson also showed that total revenues were predicted to be $54.5 million in 2019, and $48.75 million in 2023, compared to the $54.15 million in revenue for 2018. Now, the forecast shows revenues will be close to $55.7 million this year and $54.3 million in 2023.
He said this shows an increase in projections, but there will be a decrease in revenue every year. He said a factor to this was the state phasing out reimbursement funds given to the school district from the tangible personal property tax. He said that revenue is going down by about $500,000 each year, with about $3.3 million this year, about $2.8 for 2020 and so on until it hits zero.
Also, Johnson showed expenditures were predicted to be $53.08 million 2019 and $62.03 million in 2023, compared to expenditures in 2018 being $49.59 million in 2018. Now, the forecast predicts expenditures for 2019 being $52.82 million and $62.26 million in 2023.
He said expenditures are decreasing because of utility costs coming in cheaper due to the district is “efficiently using” them, fewer students are attending charter schools and the fact fewer teachers this year received their performance bonus.
Johnson said the district is phasing out the performance bonus in 2021. He said this helps drive down costs because it “helps contribute to the salary increases as well as the insurance increases,” and will “partially offset costs,” as per the teachers union contract that was recently extended.