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Kent School District Updated Four Year Financial Projections

In August the KSD Board adopted the 2018-2019 budget, which, for the first time in Washington State History, included a four-year projection for the district as required by law. On Wednesday, November 14, 2018 in accordance with a request from OSPI, the KSD School Board approved a revised 2018-19 budget which includes our adjusted enrollment counts for the 2018-19 school year, settled contracts and revised four-year outlook.
The revised multiyear forecast has been updated to reflect early 2018-19 enrollment counts and approved salary increases for contracts that settled after the original 2018-19 budget was adopted in August. Several key assumptions remain true in the revised outlook including: enrollment remaining similar to 2018-2019, levy amounts which are based on state projections and that the replacement Educational Programs and Operations Levy in 2020 is passed by voters. An inflationary adjustment for all expenditures is also included every year for projection purposes.

 KSD's revised four-year outlook

The revised outlook also now reflects our 2017-18 ending fund balance. After beginning the 2017-18 school year with a fund balance deficit of approximately $5.6 million, through sacrifice and commitment by all KSD staff members, the district ended the year with a positive ending balance of $29,496. While this ending fund balance is not near the Board Policy 6002 requirement of unassigned minimum fund balance of 5% or nearly $17 million for 2017-18, this is a signal that the district is moving in a positive direction.

The last time Kent School District met the Board Policy required 5% unassigned minimum fund balance was the 2013-14 school year, ending August 31, 2014.

 Unreserved portion of fund balance 8year

As a district, the commitment to financial solvency and our budget recovery plan continues. Our Executive Director of Budget and Finance, Ben Rarick, and the entire budget and finance team continue to work closely with the Superintendent and Executive Cabinet on our budget processes and procedures. Through this leadership several key changes in our financial practices have occurred which contributed to the positive ending fund balance of 2017-18. These changes include:

  • internal communication practices such as how the budget and finance team worked with central office leaders to develop, revise and plan 2018-19 budgets
  • external communications such as the increase in budget work sessions with the KSD Board in open public meetings
    leveraging categorical dollars for allowable expenses to protect basic education and general fund dollars
    • Mr. Rarick spoke to specific examples of this at the November 14, 2018 Board Meeting including ensuring that eligible tech levy expenses per the resolution are not exclusively charged to the general fund.
  • considering long-term implications of budget decisions, the legally required four-year outlook requires all school districts, including Kent, to consider the impact decisions made now have on the budget in the next five years

The Kent School Board also continues to make efforts to increase transparency around our financial status through their work and is now accepting applications for the new Board-Approved Fiscal Recovery Task Force.

In 2017-18, for the first time in five years in the Kent School District, revenues exceeded expenditures. Due to changes in state funding, KSD will also see this happen again in 2018-19. However, the four-year outlook clearly demonstrates this pattern cannot continue and our fiscal solvency needs to continue to be a priority for all stakeholders so that we can ensure all dollars are being used for our core business which is teaching and learning with an emphasis on learning.