March 29, 2024

Newton school district could be debt free in 2 years

District finances steady, according to superintendent

In two years the Newton Community School District could become free of any outstanding debt obligations, according to Superintendent Bob Callaghan.

The district has been using funds from its local option/statewide sales and services tax fund to pay off its debt service fund instead of raising the property tax levy. Off the top of his head, Callaghan estimated the district had a little more than $2 million left on the balance for its debt.

“We feel that our debt will be paid in full within two years,” he said.

Callaghan made this announcement as he was filling in for District Business Manager Gayle Isaac in delivering the district’s treasurer’s report at Monday’s board of education meeting.

The report covers the district’s expenditures and revenues for the 2013-2014 fiscal year, which ended on June 30.

According the report, the district begin the ‘14 fiscal year with a general fund balance of around $3.4 million and ended the year at a little more than $2.9 million. This was due to the district spending around $500,000 more on its expenses than it had in revenue, Callaghan said.

“... We had to go into our savings accounts to pay for everything we spent last year,” Callaghan said.

In total, the district had around $29.6 million in revenues and $30.1 million in expenditures for the ‘14 fiscal year. The report also indicates that the district finished with $412,379.50 in its student activity fund, $1,197,228.18 in its management levy fund, $830,433.55 in the physical plant and equipment levy fund and $818,744.78 in the enterprise fund.

“Budgetarily, there has been great efforts to try and bring everything so that we are in good stead financially throughout the board,” Callaghan said.

Callaghan said this report is proof that the district’s efforts to conserve funds have been working after it froze budgets and cut costs in February after Isaac forecast the district was going to be in a $1.6 to $1.9 million deficit.

“I know it was a tough time for everyone, but I can tell you the proof is right there in that we only had to go into our savings account $500,000. I know that sounds dramatic, but it’s a lot better than where we were,” Callaghan said.

One of the biggest concerns about the potential deficit was lowering the district’s spending authority, which Callaghan estimated is currently in the $6 million plus range. He said had the district not been proactive in averting the deficit, more funds would’ve been taken out of the general fund and the district’s spending authority would’ve dropped to around $4 million.

The treasurer’s report also serves as the district’s certified annual report, which had to be delivered to the Iowa Department of Education by Sept. 15.

No vote was held since the matter was just a discussion item, but another financial matter was approved by the board.

The board agreed to apply for supplemental aid and allowable growth from the state and to be able to levy property taxes to recoup money that is spent on special education in the district.

By approving this measure at this juncture in time, the board is not saying that it will raise the property tax levy, however, this gives it the option to raise it next April when district’s are preparing budgets for the ‘16 fiscal year.

The district is seeking to recover $673,069.16 for its special education deficit. In total, the district spent $6,474,783.44 on special education and had $5.8 million in revenues.

Contact Senior Staff Writer Ty Rushing at (641) 792-3121 Ext. 6532 or trushing@newtondailynews.com