Audit highs and lows

In a rundown of the annual audit, the Cloquet school board got mixed news on the budget and the best rating from the auditing firm BerganKDV.

Revenues for the last fiscal year were slightly higher than expected, at $36,935,439 versus $36,762,596, a difference of $172,843. However, the general fund account showed expenditures of $1.3 million, $1 million more than the predicted budget deficit of $284,000.

But that doesn’t mean the district was in the red by roughly $1.3 million.

BerganKDV manager Dustin Opatz explained the bulk of the extra expenditures are being covered with federal Covid funds that weren’t included in the revenues. The district is also earning more money from activities, now that extracurriculars are in full swing again. So the district’s fund balance actually dropped by only about $541,000, which is still manageable thanks to healthy reserves.

Superintendent Michael Cary compared it to saving money for a big family trip.

“You might save up for a couple years … and then you go off and take the family trip and all of a sudden you might technically end up in the negative,” he said. “We were planning some of those expenses and saved up, and that’s why you see a little bit larger deficit.”

Board members got good news about open enrollment, which has kept to a minimum the effects of an actual decline in the number of residential students within the district.

The number of resident students has dropped by roughly 157 since 2018, while nearly 333 students open-enrolled out of the district in 2022. However, almost 713 students open-enrolled into the district in 2022.

“Even though your residents are declining, your open enrollment is helping you quite a bit so that your total enrollment is actually staying pretty flat year over year,” Opatz said.

In response to a question from board chair Ted Lammi, Opatz said it is a “bargain” to go to school in Cloquet, at least for the taxpayers.

He explained Cloquet schools get only about 8% of revenues from property taxes, which is under the state average. For 2021, the most recent year state averages are available, those property tax revenues were $850 per student locally, compared to the state average of $2,381.

“Cloquet’s only receiving about 35% of the property taxes that the average other district is receiving,” Opatz said. “My colleagues like to talk about how good of a deal Cloquet residents are getting.”

The board unanimously voted to accept the final 2022 audit. Board member Hawk Huard was absent.