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Rugby Public School District deficit to be at $150,000 next year

By Staff | Apr 28, 2017

Rugby Public School District projects a deficit of $150,000 at the end of next year.

This is mostly because of state budget shortfalls, caps on the local levy and projected cuts on the federal level.

“It makes it difficult when there is no surplus [on the state level],” said Superintendent Mike McNeff. “Costs rise. Salary raises are expected and benefits go up. With zero percent state funding, it makes it more difficult when you’re capped locally, as well.”

Rugby is currently at the local cap, 82 mills, and has been for the past two to three years.

State funding works based on number of students in the district. There is about $10,000 given per student. The problem in Rugby, however, has to do with enrollment fluctuations.

Enrollment this year has been up and down, according to McNeff, with fewer students now than at the start of the year.

“We have 560 students total in the district currently, but the problem is when you lose five to 10 kids, that’s a lot of money you lose, too,” McNeff said.

There is projected to be a rise in enrollment next year because of a small graduating class and a larger incoming kindergarten class, however, state funding is based on the previous year’s numbers.

The average number of students during the 175 instructional days is used to determine how much funding the district will receive.

Rugby is looking at a little over $200,000 less state funding for next year due to enrollment, higher taxable valuation, cuts on the federal level and cuts in transportation.

“We just don’t know what’s going to happen on the federal side because of Trump’s projected budget cuts to Title I and Title IIA,” McNeff said.

McNeff believes that larger and growing districts will have a better chance for funding because of larger enrollment numbers, but districts such as Rugby, which are more stagnant, are going to have a harder time.

“Unless they raise the payment per student, we have got to get more students, which is difficult to do in a rural area,” he said.

Another projected issue has to do with a decrease in taxable valuation, which has generally seen increases since 2010. A decrease would also decrease the value of a mill, which is a problem in itself, according to McNeff.

Currently, Rugby’s budget is made primarily of staff costs. “When 80 percent of your budget is made up of staff, there isn’t a lot of room to trim,” McNeff said. “We have talked about making cuts to supplies but we do need new curriculum. We need those things so we’ve been asking what can we put off for another year.”

Fortunately, Rugby High School is a fairly new building and Ely Elementary has been kept in good shape, so deferred maintenance costs are not an issue. Upkeep is still needed, however, which means more costs to the district.

The district is looking at about a 19 percent carry over at the end of this year which is well below the average of around 35 percent for other districts.

“You can’t always deficit spend. I have been talking with the board, and we are really studying the issue and trying to decide what our priorities are moving forward for the next two years. We’ll look at deficit spending for a year and then make some decisions after that,” McNeff said. “Costs will continue to rise, regardless.”

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