Jackson school district losing money
Friday, November 14, 2003
An audit of the Jackson School District's finances confirmed what officials there have been saying for the past year: they're losing money quickly.
The Jackson School Board approved this week a financial audit for the 2002-03 school year performed by Larson, Allen, Weishair & Co., LLP in St. Louis.
According to the audit, the district began the 2002-03 school year with $2.8 million in reserve funds. Those funds dropped to $1.9 million by the end of the school year, or around 8 percent of expenditures in reserve.
The reserve fund balance is projected to drop to $1.05 million at the end of this school year because of a projected loss in state funding and increases in medical insurance and other costs.
That will leave the district with a fund balance of only 4-percent, the lowest allowed under state law without being labeled a financially distressed district.
"The auditors really pointed out what we've been saying for a while now," said superintendent Dr. Ron Anderson. "Our balances are getting low."
In total, Jackson's net assets last year decreased 32 percent -- or $2.7 million -- from 2002. But a significant portion of that drop can be attributed to the final payments made for construction of a 22-classroom addition, new gymnasium and other expansions at R.O. Hawkins Junior High School that were made last year.
The district's assessed valuation dropped from $264 million in 2002 to $257 million in 2002-03. Anderson said that could be due in part to a Chapter 100 agreement between Cape Girardeau County and Procter & Gamble.
Chapter 100 agreements are an industrial development mechanism through which companies are given property tax breaks as incentives to locate in a particular place.
The school district does, however, receive some revenue from the county to partially offset the loss of property tax revenue from Procter & Gamble.
"Chapter 100 agreements are what make an area financially competitive for businesses," Anderson said. "It's what makes a company come here instead of going somewhere else."
Anderson said it's better to lose some money than not receive any tax revenue at all, which might be the case without the Chapter 100 agreements.
335-6611, ext 128