Cloquet board anticipates a deficit next school year

Cloquet school board members approved next year’s school district budget with an anticipated deficit of $411,000 — but knowing the district will likely receive $500,000 dollars in federal Coronavirus Aid, Relief, and Economic Security (CARES) Act funding.

Finance director Candace Nelis said the CARES funding is not included in the budget, because they just got notification from the state Monday morning of its allocation, and how the district will need to apply for the funds. The money can be spent only on expenditures related to COVID-19; for example, the extra hotspots and iPads the district had to purchase to make sure every student in grades 5-12 had a computing device and access to the internet.

Superintendent Michael Cary explained that although the two-page budget document appears to show the district planning for a $1.16 million budget deficit, that is not the case.

“The bulk of that money is money we’ve saved up ... and we’re trying to spend it this year,” he said, comparing it to saving money for new appliances or a special vacation from previous years to spend in one particular year.

“So even though it may look like you’re spending more money this year than what you would make, it’s because you planned and saved in order to spend it in the current year,” he said. “So we’re not expecting to go $1.2 million backward unplanned. What we’re really focusing on is the $400,000 in the unassigned general fund.”

Cary added that the Cloquet district, as always, estimated revenues on the low side and expenditures on the high side. By being conservative, he said, often the district will end the year with little to no deficit spending.

“That $400,000 is a worst case scenario,” he said. Prior to all the changes wrought by the state’s response to the coronavirus, the district was close to wiping out an estimated deficit of $350,000 from last year, he explained. Now with some added expenditures as well as savings from distance learning, plus state and federal reimbursements yet to come for COVID-19 measures, the numbers for the current school year are in flux.

“[COVID-19] threw a wild card into the school year,” he said.

Cary said they have not heard anything definitive about the upcoming school year and whether the state will continue with distance learning or allow students back into schools, or perhaps insist on a hybrid solution.

“We’re hearing unofficially that we may be asked to come up with plans for a few different scenarios regarding what school could look like in fall, with a decision coming later in July,” Cary said. “The sooner we can get some definitive guidance, the better. The more time we have to plan, the clearer direction we have for planning and the better product we can put out for our children.”

The next school board meeting is set for Monday, June 22. The 5:30 p.m. working session and the formal meeting at 6 p.m. are livestreamed on YouTube; just click on the meeting link posted to the district website the same day. Public comment for school board meetings may be submitted by email by noon the day of the school board meeting to Bonnie Monfeldt, Executive Assistant to the Superintendent, at [email protected] or call 879-6721, ext. 6204.