Business Committee Mtg., July 10, 2006

[Guest sullinss]

Proceedings of the Business Committee

School District No. 2, Yellowstone County

High School District No. 2, Yellowstone County

Billings, Montana

 

July 10, 2006

 

Call to Order

 

The Regular Meeting of the Business Committee of School District No. 2, Yellowstone County and High School District No. 2, Yellowstone County, Montana met at Lincoln Center, 415 North 30th Street, Billings, Montana, on Monday, July 10, 2006. Chair K. Dale Getz called the meeting to order at 5:30 p.m. and led those assembled in the Pledge of Allegiance. Committee members present were K. Dale Getz, Katharin Kelker, Peter Grass, Jerry Hansen, Joan Sleeth, and Jerome Chvilicek. Absent were members Rachel Stagg, Curt Prchal, Shanna Henry, and Kari Altenburg. Member Tim Cranston has resigned from the Committee; and, the Principals’ representative Scott Anderson has accepted a new position and is no longer a Committee member. Stan Barr of the Career Center will be the new representative for the Principals and will start attending in August. Also present were Thomas Harper and Jack Copps.

 

Consent Agenda

 

Katharin Kelker moved to recommend Board approval of Consent Agenda items as follows:

1. Business Committee Minutes of June 12, 2006

2. Joint School/Community, Education and Business Committee Minutes of May 08, 2006

3. Addition of Crossroads Graduates Trust Account at Lincoln Center

Peter Grass seconded the motion. The motion carried unanimously.

 

Comprehensive Insurance Renewal 2006-07 Yr. & Fund Transfer

 

Last year the Board approved a three-year contract with agent Payne Financial/Hoiness Labar Insurance for our Comprehensive Insurance. The premiums for the 2006-07 year are as follows:

Internal

Budget Premium Service Fund

Elementary General Fund 63% 417,852 310,941 106,910

High School General Fund 37% 245,405 182,610 62,789

Total 663,257 493,551 169,699

 

Administration recommends transferring the $169,699 into the Internal Service Fund 279, which if added to the current balance of $322,968 would provide a fund balance of $492,667.

 

Thomas Harper explained the premium increased $7K from the previous year. We have had low claims experience this past year. The Internal Service Fund 279 was set up a couple years ago to pay for deductibles from insurance claims; however, it can also be used to pay insurance premiums. Most of our claims activity has been in general liability, and educator and Board liability which has a $50K deductible. If a claim is not reported in a timely manner, we run the risk that it may be denied. Historically, the difference between the budget and the premium has been transferred into the Internal Service Fund.

 

Jerry believes fund 279 is over-reserved. The General Fund needs the money and he would like to put the $169,699 into Board contingency. Jerry thinks we should develop a specific level of reserve for the 279 fund.

 

Katharin Kelker moved to recommend the Board approve the transfer of $169,699 to Board Contingency. Peter Grass seconded the motion.

 

It was clarified if we have a bad claims year, claims could be funded from Contingencies. The motion carried unanimously.

 

 

 

Health Insurance – Financial Statements – May, 2006 & June, 2006

 

The Balance Sheet and Statement of Revenue & Expenditures for May, 2006 and June, 2006 are prepared by the Business Office and presented for the Committee’s review.

 

Thomas reported our Health Insurance Fund will end the year with a fund balance of approximately $2.2M as required by the Insurance Charter. Our Actuary recommends carrying a fund balance of $1.8M. In the last 12-month period we added about $80K to the fund in terms of Revenue less Expenditures. Jerry would like to see the incurred but unreported claims on our financial statement match Gallagher’s report and shown as part of the fund balance instead of accounts payable. Thomas will take this under advisement. Chair Getz stated any changes in our reports must be communicated and well understood by all stakeholders.

 

Bills Paid – June, 2006

 

Katharin Kelker moved to recommend the Board approve the bills paid for the month of June, 2006. Jerome Chvilicek seconded the motion.

 

Jerry said payments to Public Strategies Group totaling $71,500 have all been paid from the 115 fund and believes the high school fund should pay its share. Jerry is concerned about allocation of common costs. Thomas explained our Indirect funds were generated almost entirely from elementary grants. OPI says Indirects are a miscellaneous fund and have no identification as to elementary or high school districts. Starting with year 2006-07 we will start allocating Indirect dollars between the Elementary and High School Districts.

 

Voting in favor of the motion was Dale Getz, Katharin Kelker, Peter Grass, Joan Sleeth, and Jerome Chvilicek. Voting against the motion was Jerry Hansen. The motion carried.

 

Financial Reports – June, 2006 (Unaudited)

 

The Committee reviewed the unaudited Financial Reports for June, 2006. Thomas reported the year will end better than forecasted, i.e., we will spend less than the budget amendments because utilities were less than anticipated, overruns in Special Education did not happen, severance payoff was lower than estimated, and we implemented a freeze on spending. We will probably use about one-third to one-half of the high school budget amendment amount and over half of the elementary budget amendment amount.

 

Jerry would like to see a complete set of financial statements on a quarterly basis for all miscellaneous funds by function. Chair Getz cautioned that we need to look at our new budgeting process next year before we try to change our reports. Katharin said we also need to use our financials to track the impact that Healthy Foods and other programs have on our food service fund and address it via policies endorsed by the Schools Health Advisory Committee. Thomas stated the food service fund has been self sufficient the last few years and has generated enough funds to replace equipment. Thomas noted the School Health Advisory Committee will be meeting soon and this will be taken into consideration.

 

Lunch Price Increase – 5 cents

 

Peter Grass moved to recommend Board approval to increase the price of paid lunches by $.05 cents effective with the 2006/07 school year. Katharin Kelker seconded the motion.

 

Thomas said we have a five-year contract with Sodexho with a series of one-year renewals. We are in the second year of the contract. Thomas met with the Sodexho management team and determined that a $.05 cents per meal increase in the price of paid lunches is necessary due to the general increase in operation costs (food, transportation, salaries, etc.). This would put the price of elementary paid lunches at $1.85, and middle school and high school paid lunches at $2.00. The adult lunch price would be $2.50 at the elementary schools, and $2.75 at the middle and high schools. Breakfast prices would not increase. The last price increase was 10 cents effective with the 2004/05 school year.

 

Jerry opposes the increase because he believes the elementary students are getting an unproportionate share of the increase and believes the adult price increase should be higher. Joan doubts if an increase in adult prices would generate enough funds due to the small number of adult sales.

 

Voting in favor of the motion was Dale Getz, Katharin Kelker, Peter Grass, Joan Sleeth, and Jerome Chvilicek. Voting against the motion was Jerry Hansen. The motion carried.

 

General Comments/Announcements

 

The next Business Committee meeting will be August 7, 2006.

 

Adjournment

 

There being no further business, the meeting was adjourned at 6:28 p.m.

 

 

 

 

K. Dale Getz, Chair

 

 

 

 

Sherrill Sullins, Recorder