Part II: LMS Budget Meeting 
By Alex Saitta 
July 14, 2011 
There was a ton of debate in the budget meetings whether or not the school district had savings in its general fund account that could be used to help plug the following 2011-12 deficit. 
Those who wanted to spend more in 2011-12 than anticipated revenues argued there was savings in the account, and that savings could be carried forward and then used to plug the deficit the following year.  
Those like myself who believed there was no savings in the general fund account, didn't want to spend more than anticipated revenues. To support my point, I said a lot, but mainly this. The district had to borrow about $4 million late last year in order to meet payroll. If there was savings in the general fund account, it would have used the savings to meet payroll, not borrowed money.  
The CPA who presented to the board on April 4 answered the question by saying there was short-term savings, but no long-term savings. 
Early in the year when property taxes flow in, the general fund account has a significant balance. $40 million flows in during Q1, and expenditures are much less than that in Q1, so the account has a high balance. That cash could be used to meet a short-term emergency that came up during the early part of the year, providing the money was paid back before it was needed later in the year. In a sense, the account had short-term savings that were available during the first part of the year. 
However, given all the money in the account  was spent by the end of the year, there was no long-term savings in the account. And that is the kind of savings that was needed to fund a deficit of the following year. It was a subtle point, and I see how some missed it.  
The video above is what the CPA said that supported my point.  
Looking ahead, I don't believe the district will have to borrow money this year. This is due to a few things. Total spending will be lower this year. The district has added some money to the general fund account. The timing of revenue flows are more favorable because the district is no longer receiving stimulus money.  
Here are the final votes concerning the elimination of positions. The tape speaks for itself.  
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