Ann Arbor Public Schools fund balance nearly doubles according to annual audit

By Andrew Cluley

Communications Specialist

Two straight years of student enrollment growth and some one time revenues have helped push Ann Arbor Public Schools fund equity up to eight percent of revenues. That’s according to Plante and Moran’s 2015 fiscal year audit of the district.

Plante and Moran’s Laura Claeys says the enrollment growth of about 650 students in two years is the most her firm has seen in the state. “You should be really proud about the significant enrollment increases, that’s the size of a middle school over two years, and we’re not seeing that elsewhere,” Claeys told the Board of Education.

“I really think that it needs to stand alone as a comment regarding what our district has done over the last two years. I believe you said that the increase in enrollment for the Ann Arbor Public School district is the highest increase of any district in the state,” Trustee Andy Thomas said. “That’s something that I would like the public to take home as a real positive statement about the health of the Ann Arbor Public Schools and the direction that we’ve taken to try to grow our district by attracting additional students.”

To balance the budget without making reductions in programing the additional students were needed. That’s because increases in required contributions to employee retirement funds were larger than increases in per pupil funding. The foundation allowance went up $50 per student during the 2014-15 school year, but the increase in AAPS’s required retirement contribution went up by over $100. This means in terms of funding for education, the district received $7,000, which is a decrease of $64 from the prior year.

Increasing fund balance to $16.7 million is especially important this year because it takes AAPS off of the state’s new early warning status for districts that have reserves of less than five percent of annual revenues. The district added a total of $7.9 million to the fund balance, with about $5 million coming from one-time costs, including a reimbursement for special education costs from the Washtenaw Intermediate School District.

Plante and Moran officials encouraged the board to continue to monitor fund balance levels, health care costs, capital repairs and the costs of utilities. They also urged the district to continue to advocate at the state level, build fund equity and continue to extend and enhance quality, innovative programming.

School Board Member Donna Lasinski highlighted the Plante and Moran recommendation to keep an eye on local options that are within the community’s control. “The controllable slice of this for us is the 11 percent, the $22.3 million and for that I wanted to highlight that slice which is our county special education millage which is reimbursements that we receive from the countywide millage for expenses that we must make on special education,” Lasinski said. Without this millage, these special education costs would come at the expense of other programs in the general fund.