SJSD audit highlights revenue declines as district works to stabilize budget
ST. JOSEPH, Mo. (KQTV)-- The St. Joseph Board of Education sat down for a financial audit review led by Linda Quinley, the executive finance director with the Missouri School Board Association, on Nov. 24.
Quinley started the review by breaking down the district’s state revenue and walking community members through the last five years of Average Daily Attendance and weighted Average Daily Attendance. She pointed out a steady decline in revenue, which mirrors the district’s drop in enrollment over the past few years.
“She's talked about some opportunities for improvement, for us to get those in a more narrow band, meaning, for us to be 1 to 2% off on some of those projections, instead of a higher percent, that we've been in the past,” Robert Hedgecorth, Assistant Superintendent for Business and Operations, said.
Hedgecorth explained that some of the projections—especially those tied to employee counts and salary schedules—ended up being underestimated compared to earlier forecasts.
“There wasn't anything mishandled or mismanaged. It was basically the forecasting of what was incorrect meaning, if you add a certain amount to the salary schedule, how much is that going to cost the district over time?” Hedgecorth said.
He added that Quinley offered several helpful recommendations moving forward, including having three or four budget amendments throughout the year.
He said more frequent amendments would allow the district to work with more accurate numbers, especially since assessed valuation and tax rates aren’t set until later in the fiscal year.
“Preliminary budget is going to be a little more varied. But when you do your October budget amendment, you know your enrollment, valuation and tax rate, which are a good indicator of what you will receive from the state and local revenue,” Hedgecorth added.
He said the district’s goal is to narrow that variance and present more accurate budgets going forward, something that will require more research and a stronger focus on data.
Hedgecorth also warned that the district could face a crisis if reserves drop to the 3% mark—the point at which the state would step in which was also what Quinley highlighted during the meeting.
“In two short years, we've fallen 16% or about 8% a year. And so in another year or two, if that trend continues, we would hit that 3% and so that would be a crisis,” Hedgecorth said.
He said the district is taking steps to get back on solid financial health by looking for ways to reduce expenses, avoid deficits and operate within its budget.
