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Hemlock Public School District-Money Matter
Hemlock Public School District-Money Matter
District
Monday, April 01, 2019

The Hemlock Public School District Board of Education is committed to sound fiscal management and utilizing their limited resources to improving student learning and achievement.

School finance is a complex environment not often easily understood because unlike business, governmental or school accounting often involves different funding streams with different spending requirements. It would be like managing your home, with three or four checkbooks that have restrictions on how and what you can use the monies toward.

The main checkbook for schools is the general fund, which the revenue stream is primarily the state per pupil foundation allowance. Historically, Hemlock Public School District general fund balance ebbed and flowed annually going up and down as the district faced declining enrollment, less funding from the State of Michigan, and increased costs. This type of fiscal situation is chaotic and leaves programs and staff wondering about their future from year to year.

The difficult part of a school budget is that 85% plus of the general fund is personnel related expenses while the remaining portion covers operational items and this leaves little room for significant expenses like bus, boilers, roofs, or window purchases.

In 2013, the district was forced to examine their fiscal management process and protocols, with things like the closure of Buena Vista Schools and early warning legislation requiring schools to maintain a minimum general fund balance or be placed on a short list of schools that would face a state scrutiny. With these motivating factors, a focused Board of Education and staff, turned a corner and started a long journey toward fiscal stability.

At the March 2019 regular Board of Education meeting, the Hemlock Board of Education approved a budget amendment for the 2018-19 school year with a projected 15% general fund balance for July 1, 2019 (end of the fiscal year). The board finance committee provided the direction for budget development for the 2019-20 school year with a projected fund balance of 15%. The threshold of 15% is considered to be a benchmark of financial stability.