November 15, 2016 (Independence, IA) As we finalized the end of the fiscal year in the Independence Community School District (ICSD), we are excited to announce favorable financials.
In public schools, there are two main financial indicators we evaluate annually. The first, is our Solvency Ratio. The best way to describe this is if we were to close the school, after we pay everyone what we owe them, would we have anything left? This ratio is a reflection of our balance sheet. Lynnette Engel, Director of School Finance, indicates that when she started in 2010, things at the school were not in very good shape. The district was on its second year of major cuts including the closing of a building. Times were tough. At that time, our solvency ratio was a negative 6.18%. With teamwork, dedication to the district and a close eye on spending, we are excited that our ratio is now a positive 13.71%. The Iowa Association of School Boards recommend districts be between 10-20%, so we are quite pleased to finally be within that targeted range.
Our second and most important indicator is referred to as the Unspent Authorized Budget (UAB). This indicator is similar to a credit card. All districts are told by the state of Iowa how much money we are allowed to spend and how we are allowed to spend it. The district authority is considered our total available spending limit for the year. Each year, districts need to keep some unspent authority available for future years and possible unforeseen expenses, like the 10% across the board cut mid-year in 2010. Our district goal is keep this number as close to the $2 million mark as possible. Although we are not quite there, we are pretty close and continue to hold steady.
As we sit back and smile at the growth from last year, we are constantly reminded of how fluid our financial conditions can be from year to year. For the first time in five years, our enrollment declined this fall by ten students, which will equate to less funding for the following year. Couple that with the annual state aid growth being considerably lower than needed to cover district pay increases, it becomes clear why it is a continuous focus for the district to stay conscientious of all expenses year after year. It remains a high priority for the district and the board to stay committed and aware of the district tax rate. We understand the impact this has on our community and do the very best that we can to keep this rate as level as possible throughout the years.
We strongly encourage all community members to reach out to our newly elected state officials and remind them how vital appropriate school funding is to our district and our community.
If you have questions or would like more information about the Independence Community School District please contact Lynnette Engel, Director of School Finance at email@example.com or visit their website at www.Independence.k12.ia.us