ROARING FORK BROADCASTING COMPANY
The Roaring Fork School District is trying to figure out how to address a slew of financial issues — both self-inflicted and external — that have extensive implications not only for the one-off issues in the 2024-25 school year, but 2025-26 and beyond.
RFSD is expecting a loss of $5.7 million this school year from a failed move to a self-insured plan, and is now grappling with reducing student counts and increasing costs in coming years. It leaves the district in a precarious position of finding money from different sources.
“It’s almost a phased approach. First, we have to stop the bleeding,” RFSD Chief of Finance Christy Chicoine said in a Wednesday board of education work session. “We’re overspending on our general fund. We’re overspending on our health insurance, so that’s been the ‘phase one’ that we’ve been triaging.
“Then we can get to, ‘OK, well, how do we cover these costs?’ Which we’re getting into very fast. … Then we go into the rest of these issues like, how do we gain a fund balance?”
After transitioning from an employer-managed plan to a self-insured model ahead of the 2023-24 school year, the district is reverting back to the employer-managed-plan model at the beginning of January due to an unexpected spike in usage — and subsequent expenses — of the program. The district first spoke publicly about the issue in September, when it was discussed in a finance update with Chicoine, who was hired in July.
Chicoine noted that the cost from the health insurance issue will become clearer in the spring.
The district’s general fund for the 2024-25 school year is $98.6 million — the $5.7 million is equivalent to around 5.7% of the district’s operating budget.
Employee benefits were budgeted for $22.9 million for the current school year — the $5.7 million means that budget is expected to be exceeded by nearly a quarter.
Another impact this year is to mill levy override funding, which is estimated to be coming in $830,000 lower than the budgeted $18 million. In the positive, the district’s mill collection from property value assessment abatements — or adjustments made to property values — increased from $100,000 to $524,500.
The district entered the school year with roughly $12.5 million in available general funds. The RFSD Board of Education in 2022 passed a policy that mandated the district keep 10% of its general fund revenues in reserve, up from the 5% mandated previously. That amounts to roughly $10 million a year that must be kept in operating reserve, leaving around $2.5 available for spending.
District staff recommended monies be drawn from a few sources to cover the health insurance loss: $1.5 million from savings from the Meadowood staff housing project; $500,000 from what is called Secure Rural Schools funding; $400,000 from abated taxes savings; the $2.5 million available from the district’s general fund balance; leaving $800,000 from sources yet to be determined.
In Wednesday’s board of education work session, director Betsy After questioned if the liquidation of assets could be used to help address some of the costs.
In the regular meeting’s written comments, an employee of the district directly asked about reselling the so-called “superintendent house,” purchased for just over $1.2 million in February — but Superintendent Anna Cole declined to leverage. In August, the board discussed options for the property, including opening it up to the district's general staff housing pool on one-year leases, so that it could continue to be leveraged for attracting executive team members in the future as needed.
In the Wednesday work session, the appetite for prioritizing selling assets over using existing monies seemed low.
“We know we need to be very cautious about our fund balances. I think we also need to be cautious about property and assets,” Superintendent Anna Cole said. “Some of these, when we talk through them, are decades old donations and allocations … so I don’t know that there’s an easy solution.”
The district also budgeted 5,115 students for the 2024-25 school year, and as of November had 5,038 enrolled, with a loss of $721,000, an average loss of $9,363 per student.
Next school year, the district is now estimating an even greater loss related to student count. RFSD projects to lose 75 additional students, budgeting a loss of $900,000. The district is also budgeting a decrease in $713,000 from mill levy revenues. On Wednesday, the district also learned of a loss of around 20% of its at-risk enrollment, indicating a further loss of $600,000.
In total, the district is looking at decreased revenues by around $1.8 million and increased expenses in the range of $4.6 million next year, though Cole noted the district is hoping to bring the latter number down.
The district is projected to continue to lose enrollment for the next several years, with demographer Shannon Bingham projecting losses in each school year through 2029, according to an Oct. 9 presentation to the board of education.
Cole said that the first priority in solving these problems is to minimize impact on the students the district serves, and the second priority is the staff.
“That next priority is how can we really mitigate, really limit the impacts to staff and their wellbeing, their salaries, their job security,” Cole said. “There’s a lot of thought around our staffing and so we want to be really thoughtful if we are making changes to that, knowing that the people in front of our students, the number, has an impact on their experience.
“We’re going to try to get as far as we can on naming (the deficit) gap before we come with the next round of staffing decisions.”
Also in Wednesday night’s meeting, the board of education was slated to approve a state-based interest-free loan of $15 million to assist with payroll and other expenditures until property tax revenue begins to be distributed in the spring; and certification of the mill levy collection rate. Those items on the agenda were not fulfilled by press deadline.