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Park Rapids School in positive fiscal shape

The Park Rapids School District is in "very positive" financial territory, the board learned Monday night.

The district has nearly doubled its general fund balance, Derek Flanagan of Eide Bailly, certified public accountants, reported. He assured the board the "district is headed in the right direction."

The general fund balance, reserved and unreserved, at the end of the fiscal year totaled $2,016,272; this compares with $1,085,758 in 2009.

The net change in the general fund balance was a "very positive" $930,514.

"Conscientious work by the staff has paid off," superintendent Glenn Chiodo said, crediting business manager Carol Hutchinson, board members, district employees and "the community's support of the referendum."

Chiodo anticipates the recent upgrades to the infrastructure will "pay dividends. I'm feeling very good about the path we're on," he said of fiscal stability.

He noted, however, the unreserved general fund balance, currently at approximately $1.2 million, should be at $2 million.

In other action, the board:

n Held a closed session regarding industrial education teacher Scott Eischens who allegedly brought a hunting rifle onto school property.

Park Rapids Police Chief Terry Eilers said both police and school officials conducted an investigation into the matter.

Eilers said the police investigation indicated Eischens' son's hunting rifle was left in his pickup by accident.

Hubbard County Attorney Don Dearstyne acknowledged the paperwork has been forwarded to his office for possible criminal prosecution. He declined comment on the case but said his office would try to make that determination this week.

Eischens has been on paid administrative leave since the matter came to light two weeks ago.

The board took no formal action on the matter Monday.

n Approved a negotiated settlement of $43,000 with former district teacher Elva Baumgartner, in return for release of all claims against the district.

The board discussed the matter in closed session prior to the motion.

n In further discussion on the audit, Flanagan noted the change in districts receiving general education aid.

In the previous four years, approximately 90 percent of the payments were made in the current fiscal year, the remaining 10 percent being paid in the subsequent fiscal year. That ratio changed to 73-27 in 2010, "putting the district in a difficult position," Flanagan noted.

The auditor's report points out the changes in federal vs. state funding sources. In 2008-09, federal sources amounted to 5.3 percent of the district's revenue, in 2009-10, the percentage increased to 16.2.

"They gave it to you on one hand and took it away on another," Chiodo remarked.

Flanagan compared Park Rapids' general fund expenditures with that of the 2008-09 statewide average. Park Rapids' regular instruction amounted to 45 percent of the total, compared with the state average of 46. Park Rapids' special education instruction amounted to 22 percent, compared with the state's 16 percent. Administration costs were 8 percent compared with the state's 9 percent.

Salaries and benefits amounted to 77 percent of the general fund expenditures in 2010.

The food service fund saw a notable increase from the deficit of $301 in 2008 to a positive balance of $87,361 in 2010. The deficit in the Community Service fund improved from $104,888 in '09 to $99,224 in 2010.

Average daily membership (the student population) totaled 1,523 in 2010, up 24 from '09 but down from 2002 when ADM totaled 1,861.

The cost per ADM served for regular instruction in Park Rapids is slightly higher than districts of similar size.

The report points out the state's projected $5.8 billion shortfall for the fiscal year 2012 and 2013 biennium diminishes the likelihood of a significant increase in education funding.

"Hard cuts and/or tax increases are more likely."