I would like to address the issue of how the $276,000 from the Leopold refinancing would be handled in the 06-07 school year if the referendum is passed.
The money for the debt service related to the Leopold construction is currently in the Business Services Budget for the District. If the referendum passes, the Board has committed to moving that $276,000 to the District’s contingency fund. Questions have been raised about the wisdom of moving the money to the contingency fund. I believe that is a wise move.
The Board has three options for the funds if the referendum is passed. It can either leave that money in the Business Services budget, it can decide to spend that money in another way, or it can decide to move the money to the contingency fund and potentially use it to soften the budget cuts that will be required for the 2007-08 budget period.
I believe the best course is to put the money in the contingency fund and use it to soften the budget cuts needed for 2007-08 if possible. I don’t believe it is wise to put something back into the 2006-07 budget now – after it was already cut – especially if it is likely that it would need to be cut again in 2007-08.
Putting money in the contingency fund does give the Board discretion on how to spend or not spend the money. Therefore, if 5 out of the 7 Board members believe that the contingency fund is needed in 2006-07 for some unexpected or unbudgeted item, the money could be used for that item. However, and I believe most importantly, the Board could decide not to spend that money at all and use it to address the cuts needed in the 2007-08 budget. If the Board instead determines now to spend that money in 2006-07, that money would not be available to cushion the blow in 2007-08.


  1. I’ve been asking the financial questions. Your statement makes sense to me if a minimum of 5 School Board members feel there are no needs not being addressed in the 06-07 budget that are important for our kids – http://www.madison.k12.wi.us/boe/minutes/special/2006-08-28.htm.
    I would suggest the School Board be more specific about this in your information.
    I look forward to learning how the other monies (not the new Leopold addition) to be refinanced are already committed for this year, or will be committed by the time the referendum vote takes place. The August 28th minutes to the Board meeting did not identify how this money was committed for 06-07. Supt. Rainwater has been helpful in answering my questions and has forwarded my question to Roger Price for an answer.
    I intend to vote yes for the referendum, but I think it’s important to be as clear as possible about how and why all the monies are being spent or are committed/not committed.

  2. Lawrie,
    Thanks for your thoughts.
    What does it mean that “the Board has committed to moving that $276,000 to the District’s contingency fund?” Did the Board take a formally binding vote? If not, we can’t know what the Board might do with the money. If not, the Board is simply saying, “Trust us.”
    If the Board fails to move the funds from Business Services, they will most likely remain there forever and ever because of the way the administration prepares and the Board approves the cost-to-continue budget.
    What’s the current balance of the contingency fund? If it has a healthy balance, why would it need more?
    If the referendum should pass, the money should be spent this year to ease this year’s cuts which are real. I hope that next year’s budget can preserve most, if not all services to students, through administrative cuts and programmatic changes.

  3. Lawrie: I agree with you 100%. Once again, you are demonstrating the kind of leadership the Board needs on these matters. Thank you!

  4. Lawrie,
    I forgot to add in my comments – thank you for writing a summary of what the board did and why. This information is indeed very helpful.

  5. To clarify my earlier post. I noted that the vote was 5-0 because I am not sure how I would have voted. The decision to designate contingency fund was made in a meeting between the superintendent and board leadership, and first appeared in the wording of the resolution. I would have appreciated the opportunity to be at the meeting where the change was explained and discussed.
    The meeting at which this was done was a ‘special’ board meeting and scheduled for 5 PM when two of us were unavailable for work reasons. Had the meeting been held after 7, I would have been able to attend.
    I registered my dismay that the vote was being held at a time when two of us could not be there because I felt that the distinction was important enough for the entire board to be informed and available to vote. It is not unusual for the board to schedule actions when all members can be there. The apparent urgency of this matter made it impossible for two of us to participate either for or against this vote.

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