December 9, 2024
When the school budget is audited annually, local media often publishes headlines that only tell part of the story. School finance is highly complex, yet APS manages its finances exceptionally well. A strong financial foundation is crucial to Alpena Public Schools’ ability to support students, staff, and facilities now and in the future. Like all public schools, our finances undergo rigorous annual third-party audits. Once again, our practices passed with flying colors. We are dedicated to being excellent stewards of the financial resources provided to us by our community.
Fund Balance (What is it and why do we need it?)
In 2023, expenses were below budget, enabling the district to add to its general fund balance—a vital cushion for unexpected expenses or revenue shortfalls. Our fiscal year begins on July 1st, yet we do not receive a payment from the state of Michigan until October 1st. This means the district needs to have enough funds in its general fund balance to cover the expenses for two months out of the year or incur unnecessary interest expenses from borrowing the money to cover this gap in funding. This has happened in the past when our fund balances were lower.
Currently, the general fund balance stands at approximately $16 million. Here's how it is allocated:
Non-Spendable: $506,576 (inventory)
Restricted: $1,704 (stadium-related athletics)
Committed: $135,390 (stadium turf, athletics, scholarships)
Assigned: $856,243 (specific areas, such as Campus Closet)
Unassigned: $14,289,968 (readily available for use)
Our Strategic Plan directs us to utilize these funds to balance investments in instructional programs, facility improvements, and extracurricular activities. As stewards of taxpayer dollars, we ensure that every dollar reflects our commitment to student success and district sustainability.
Over the next 3–5 years, our 10 buildings (totaling 649,849 square feet) will require over $9 million in upgrades and maintenance—costs beyond those covered by the Safe, Warm, Dry Bond. Individual expenses in our instructional programs and extracurricular activities may not be as large as those attached to our facilities, but there are more initiatives in these areas that, when looked at as a total package, can total millions of dollars.
Unlike expenses for instructional programs, facility improvements, and extracurriculars, which are typically one-time costs, staff compensation expenses are compounding. These costs recur annually and increase each year.
Ask APS
This focus on financial responsibility often prompts questions from our community. A recent inquiry asked:
“If the district has such a large fund balance, why won’t the superintendent just pay all employees more?”
Most employees are unionized, and compensation is negotiated through a Collective Bargaining Agreement (CBA) between district administration and union leadership. The superintendent cannot unilaterally decide compensation. Since 2020, the district has worked with employee groups to provide stipends and additional compensation beyond what CBAs outline, requiring formal agreements between both parties.
Balancing fair employee compensation with long-term financial stability is a core responsibility. A healthy fund balance supports infrastructure, instructional needs, and commitments to employees while safeguarding the district’s future.
Another question asked:
“Why does your advertisement for hiring new staff show wages higher than for long-term employees?”
It is a misconception that we were advertising higher than current employees receive. Some employees and community members may not have been aware of a higher rate that was agreed upon. However, our current advertised rates reflect rates recently presented by the district and agreed to by the employee groups through the processes mentioned above. We review salary and compensation regularly to remain competitive. Nationally, wages have risen at rates not seen in years. We advertise for various positions, each with different compensation levels. As noted earlier, employee compensation is determined through a collaborative process between administration and employee groups.
Upcoming School Events
This is a wonderfully busy time of year in our schools. Please join us for our school events. Check out the weekly newsletters from your principals, or go online to www.alpenaschools.com and check our calendars.
Winter Break
Students’ last day is Friday, December 20, 2024. Classes resume on January 6, 2025.
I wish you and your family the happiest of holidays!
