The Fremont Public Schools Board of Education approved a $68.4 million general fund budget for 2021-22 at its Monday night meeting.
Due to decreased revenues, some FPS cash reserves will need to be used.
FPS Assistant Superintendent Brad Dahl provided a detailed budget analysis and explained funding sources.
He said property tax is the district’s largest revenue source. This tax is affected by the assessed value of property.
This year, the assessed value decreased by 2.36%.
Dahl said the commercial and industrial personal property taxable value decreased for items such as equipment by more than $202 million.
This occurred due to the Nebraska Imagine Act — business incentive legislation for mega and modernization projects.
Local large businesses qualified for this act.
Dahl said he believes this is a one-year loss and doesn’t think the budget will be impacted as much in the future as it was this year.
There also was a reduction in the taxable value of agricultural property, both irrigated and dryland, as the value of farmland decreased. Railroads saw a reduction of about $700,000 in personal property taxable value.
At the same time, what’s called real property — such as the value of a home in Fremont — increased.
“Overall, we saw residential lands, residential and commercial improvements increase over $115 million,” Dahl told the Tribune.
But altogether, the personal and real property taxable value saw a total reduction of 2.36%.
That equals a reduction of $68,118.144, Dahl said.
Because the overall assessed value of taxable property decreased, the levy didn’t generate as much property tax.
Dahl added that state aid — the district’s second largest revenue source — also has seen a decrease.
Due to the decrease in assessed value and in state aid, $2.7 million in cash reserve will need to be used.
“We do not plan to increase our levy — even with that reduction,” Dahl said. “This year we plan to use some cash reserve to balance the budget.”
Dahl said the district’s cash reserve has been built up during the last several years.
He said this is built up because not even a dollar of this year’s budget is received until April.
The cash is needed to pay personnel and meet educational needs. People will pay their taxes for this fiscal year and then the district will start to collect for the current budget.
Board member Todd Hansen said the district can’t get into a habit of using cash reserves each year and Dahl agreed.
Dahl also pointed out that the general fund budget decreased by 1.7% from $69,660.381 in 2020-21 to $68,473.032 for 2021-22.
He said the budget decrease primarily is due to the spending down of federal funds intended to assist with COVID-19 costs.
There was a large increase in federal funding due to the pandemic. The federal funds are used for protective equipment, capital improvements, learning loss and transportation.
Dahl said federal funding made up 18.78% of the budget. On an average year when there isn’t a flood or COVID-19, the district typically averages about 8% of its budget coming from federal funds.
FPS board member Mike Petersen asked if the federal portion of the budget returns to 8% if then the district will need to use even more cash reserves.
Dahl said he doesn’t think so. He believes federal funding will help meet current needs and, hopefully, more vaccinations will occur and the district will see less of a need for COVID protocols.
He believes state funding for the district will increase in the future because student numbers have increased. Dahl also anticipates growth in commercial and personal property taxes.
FPS is serving 5,049 students at this time.
The district ranks 11th out of 224 school districts in the state in per-pupil spending.
That means only 10 districts spend less per student than FPS.
FPS spends $11,981 per pupil compared to the state average of $13,558.
Current levy limitations don’t allow FPS to spend the state average.
Dahl also said it costs more to educate students who live in poverty or those with ELL needs.
He said smaller neighboring districts don’t bump up against their levy limitations, because their needs (numbers of students) are significantly less than their resources.
“We have about $500,000 of assessed value per student, but we have neighboring districts that have $2.5 million of assessed value behind each student,” Dahl said.
Dahl also said building maintenance, safety and transportation costs affect the budget.
“We hope to address a lot of our building maintenance with the bond, but we’ll continue to have building maintenance needs and we’ll continue to budget for those,” Dahl said.
FPS Superintendent Mark Shepard said Dahl and FPS Director of Accounting Susan Plank have done an amazing job, saying this wasn’t an easy budget.
Shepard said during the last eight years FPS has done a great job of growing its cash reserve to the point where it doesn’t have to borrow money to meet needs.
“You as a board have done a great job of holding the line on expenditures,” Shepard said. “We truly levy what we need and spend what we need and not a dime more.”
FPS Board of Education meetings start at 6:30 p.m., the second Monday of each month in the board room of the Main Street Building, 130 E. Ninth St., Fremont. Meetings are open to the public.