AUSTIN — A shrinking fund balance and a disappearing levy is pushing the Austin School Board to do something it hasn't done in 16 years: ask voters for more money. 

Lori Volz, the district's executive director of finance and operations, told the board that the comfortable cushion of reserves the district's unassigned general fund has enjoyed for many years will dip below the self-imposed minimum fund balance of 8.33 percent of the general fund during the 2019-2020 school year. 

Volz also told the board that the current levy of $342.70 will expire at the end of the 2020-2021 school year. 

"We've generally had healthy fund balances," Volz said. But the 2018-2019 fund balance will end up right at the minimum, she said, and the fund balance for the upcoming school year is projected to fall to 5.98 percent.

Because of a change in how much school boards can approve on their own without voter approval, Volz said the 2019-2020 voter-approved levy amount will be $42.70. 

But just replacing the current levy amount isn't enough, she told the school board, citing the declining fund balance and a dip in enrollment last year.

And as costs go up — the board approved new collective bargaining agreements with the secretarial union, food service workers, and custodial and engineering union, all of which will see total salary and benefit increases over the next two years — the fund balance will continue to drop. 

Volz said the district needs to increase its operating levy amount through a referendum either this fall or next fall.

“The Legislature is not adequately funding education,” she said. "We’re losing traction, actually. We need to bring in additional revenue streams."

The district has plenty of room to add to its levy, she said. The $342.70 per pupil levy in Austin is far below the state average of $939 and below other area schools such as Red Wing at $1,950, Winona at $1,527.67 and Rochester at $1,061.38.

Superintendent David Krenz pointed to a loss of students last year that dropped the district's income unexpectedly. But, like Volz, he said funding from the state, which is where 80 percent of the district's income comes from, has also slowed, and the annual 2 percent increases aren't enough to offset rising costs.

"It’s 2 percent, 2 percent, 2 percent; you can’t live off that," Krenz said.

He did point to the positive sign of increased enrollment — the district is expecting 10 more kindergarten students than the projected enrollment of 370.

But without a levy increase, Volz said, the district could be looking at budget cuts.

A special session of the school board will be held at noon Monday in the district conference room to decide whether to put an operating levy referendum on the Nov. 5 ballot. 

"We’ve been very fiscally responsible," Krenz said. "We’ve run the ship lean. It’s just caught up with us."

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