701.5 Fiscal Management

The Board recognizes its fiduciary responsibility to oversee the management of school district funds in keeping with the school district vision, mission and goals. To achieve this purpose, the board may engage in learning about the financial needs, operations and requirements of the district as appropriate for the board’s understanding of the district’s financial position. The Board also commits to engaging in annual financial goal setting for the district based upon measurable data and projections for the district.

After the fiscal year has closed, the Superintendent or their designee will provide to the Board concise, timely, well organized financial data. The Board will exercise its oversight responsibilities by reviewing relevant PK-12 public education sector indicators to understand the financial trends of the district.

The board will establish and review financial goals annually. The District will measure whether these goals were obtained as of June 30, but only after completion of the Certified Annual Report due September 15th each year.

Providing the best possible educational experience for all students and meeting federal, state, and local academic goals for each student requires maximizing General Fund resources for use in the instructional program. The board may request from the School Budget Review Committee (SBRC) additional modified spending authority (MSA) where it may be available for items such as:

Special education deficit balances
Advances to support increasing student enrollment
Supports for students identified as English Learners
At risk / dropout prevention programming
Initial staffing associated with opening new buildings or programs
Any other lawful purpose

Any award of modified supplement amount will be levied as a cash reserve based on the recommendation of the superintendent/designee and approved by the Board of Education in keeping with the fiscal management performance measures provided for in district policy.

Legal Reference: Iowa Code §§ 257.7, 31; 279.8

NOTE: Districts should include any optional uses of MSA the district uses to the bulleted list.

I.C. Iowa Code

Description

Iowa Code § 257.31

Finance Program - Committee

Iowa Code § 279.8

Directors - General Rules - Bonds of Employees

Iowa Code § 257.7

Authorized Expenditures

Approved 12-18-23 Reviewed Revised

701.5R1 Fiscal Managemetn - Financial Metrics

The following relevant PK-12 public sector indicators will be provided to the Board annually to better understand the financial trends of the district. These indicators will be an accurate depiction as of June 30th of the preceding fiscal year and will depict at a minimum of three years of data.

Total revenues and expenditures by fund and major sources;
Financial Solvency Ratio - assigned plus unassigned fund balances divided by total revenue minus AEA flow through;
Unspent Authorized Budget Ratio - amount of maximum spending authority left at year end after deducting the general fund expenditures incurred during the year;
Unspent Authorized Balance Ratio Net of Restricted Fund Balances (Categorical Fund Balances) - amount of maximum spending authority left at year end after deducting both the general fund expenditures incurred during the year and the total restricted fund balances (categorical fund balances) at year end;
Enrollment Trend - funding follows the student so it is important to understand district enrollment numbers;
Staff costs as a percent of total general fund.

Financial Projections

Five-year financial projections of the general fund will be prepared and updated annually. The general fund is the operating fund of the district where the majority of salaries and benefits are funded. Projections will help the board determine sustainability of the annual operating budget and help make future budgetary decisions.

The District is committed to utilizing the following financial metrics in determining district financial goals:

Unspent Authorized Budget Ratio: Maintain unspent authorized budget ratio within 10-20% target range. The current year’s projected balance will be discussed with the Board before staffing and other spending decisions are finalized for the succeeding year.
Unspent Authorized Budget Net of Restricted Fund Balances (Categorical Balances): Maintain unspent authorized budget ratio net of restricted fund balances (categorical balances) within the 5-10% target range. The district will attempt to spend the restricted (categorical) annual allocation in the year received to the extent possible.
Solvency Ratio: Maintain an unrestricted, uncommitted general fund balance within the 10-20% target range with 10% being a minimum goal. The current year’s projected balance will be discussed with the Board before establishing the succeeding year’s cash reserve levy and before staffing and other spending decisions are finalized.
The District will take reasonable steps to achieve a total general fund balance at least equal to its unspent authority. This enables the District to cash flow its legal spending limit.