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The maximum spending authority is defined as the combined district cost, plus the miscellaneous income, plus the unspent balance authority from the previous school year. This establishes the legal limitation of expenditures for the school district's budget. The combined district cost is determined by multiplying the enrollment for the regular headcount taken on the third Friday of September and the special education weighted count, times the cost per pupil for the local school district. The AEAs cost per pupil, times enrollment, are added to this number to determine the total combined district cost. Miscellaneous Income is all revenue received by the school district except for property tax and state aid as computed by the State Foundation Formula. The Unspent Balance is the carryover of unused spending authority from the previous school year. The Unspent Balance Authority may or may not reflect cash actually on hand by the school district. The Unspent Balance may be funded with cash on hand or with a cash reserve levy. The Unspent Balance is like a savings account; once it is used, it is gone forever. It is a one-time expenditure type of dollars.
In summary, the maximum spending authority of the school district, which is the combined district cost, plus miscellaneous income, plus the unspent balance from the previous year, minus the expenditures for that year, will leave the unspent balance authority which will move to the next year's budget. By law it is illegal for a school district to have a negative, unspent balance. In other words, to deficit spend in the General Fund, a district, which over expends their budget, will be asked to present a workout plan before the School Budget Review Committee. |
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