Agenda - 06-06-2013 - 1-3 - Laserfiche WebLink

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Attachment D 17 r EL HILL May 28, 2013 Mr. Frank Clifton Orange County Manager 208 S. Cameron St. Hillsborough, NC 27278 Dear Mr. Clifton: The Chapel Hill — Carrboro City Schools would like to provide an update on the status of the fund balance in the Local fund to date and the projected fund balance availabe to be assigned in the 2013 -14 budget. It has been mentioned that the district's fund balance may be a funding source to fund the opening of Northside Elementary. We ended the fiscal year 2011 -12 with a total fund balance of almost $10.9 million. Of that amount, by State statute, we reserved $1.5 million. Our Board assigned $3.2 million to balance the 2012 -13 budget leaving a $6.1 million unassigned fund balance. During this fiscal year, the Board has, to date, appropriated an additional $1.2 million of the $6.1 million for 2012 -13 expenses. These expenses ranged from funding student laptops and purchasing yellow school buses to planning funds for the new magnet school to open next school year. The district anticipates closing this fiscal year with a total fund balance of $9 million. Of course we are still expending funds for this year and this is only a projection. The Board plans to, again, assign $3.2 million to balance the 2013 -14 budget. Historically, Chapel Hill — Carrboro City Schools assigned $1 million to balance the budget, but due to State budget reductions over the past years, the district moved positions that were previously funded by the State to the Local budget in the amount of $2.2 million. This was done to delay the elimination of positions in our district with hopes that there would be an economic upturn to prevent this drastic reduction in force. After accounting for anticipated required financial statement reserves and the planned fund balance assignment for 2013 -14, we project an unassigned fund balance of $3 million. The 5.5% fund balance target for our district for operating purposes is $3.4 million. Funding the $1.9 million needed to open Northside Elementary on Local fund balance is not a fiscally sound alternative for the Board. The Local fund balance is a non - recurring source of funding and we would significantly increase the number of staff positions to be elimiated in 2014 -15. We do not know what the state of the economy will be a year from now. Lincoln Center, 750 S. Merritt Mill Road • Chapel Hill, NC 27516 -2878 • (9 113) 967 -8211 • www,chces.k12.nc.us.