Independent School District 196
Rosemount-Apple Valley-Eagan Public Schools
Educating our students to reach their full potential
Budget Advisory Council Minutes
6:30 p.m., September 9, 2015
District Office
Present:BudgetAdvisoryCouncilmembersKathyCason,KarenHarrold,GraceKeliher,ChrisKnight,Gary
Krueger,ChadLaBahn,JeffLittle,ChasMcCready,KrisNelson,JohnWollersheimandChrisWong;,directorof
financeandoperationsJeffSolomonandcoordinatoroffinanceStellaJohnson.Absent:BudgetAdvisoryCouncil
memberJasonElias.Guest:MerleWaters,SeniorVicePresident&SeniorInvestmentStrategist,WellsFargoBank.
ChairpersonChadLaBahncalledthemeetingtoorderat6:35p.m.
PublicInput–Noonewaspresentintheaudience.
Welcome,Introduction–TheBACwelcomedthreenewmembers,GraceKeliher,ChrisKnightandChrisWong,
andeveryoneintroducedthemselvesandtoldabitabouttheirinvolvementwiththedistrict.
ReviewAgendaandMinutes–TheagendawasreviewedandtheJune10,2015minuteswereapproved.
BudgetAdvisoryCouncilLeadership–ChadLaBahnandJeffLittlevolunteeredtoserveasco‐chairpersonsfor
the2015‐16schoolyear.AllmembersvotedinfavortoapproveChadandJeffasco‐chairpersons.
OPEBTrustOverview/InvestmentPolicyReview/Discussion–SeniorVicePresident/SeniorInvestment
Manager,MerleWaters,ofWellsFargoBankreviewedtheOPEBclientsummaryshowingsincetheinceptionofthe
TrustinMarch2009,theassethasgrownfrom$37.15millionto$47.27million(August31,2015).Thisincludes
theAugust2015drawof$1.4million.TheannualizedrateofreturnfromApril1,2009toAugust31,2015of
5.10%isslightlybelowthedistrict’stargetreturnof5.50%.PriortothemarketcorrectioninAugustthe
annualizedreturnwasabovethetargetrateofreturn.HeassuredtheBACthatitisnotunusualtohavethistypeof
marketcorrectionandthevolatilitymaycontinueforanothercoupleofmonths.Mr.Watersreviewedtheexecutive
summaryshowingmeaningfultransactionsforthelasttwelvemonths.WellsFargocontinuestomonitorand
rebalancetheportfolioasneeded.Duetosomeanticipatedchangesinthemarket,includingincreasedinterest
ratesandlowerbondreturns,Waterssuggestedthedistrictconsiderrevisingtheinvestmentpolicystatementas
indicatedbelow:
 ReduceFixedincome‐40%to35%
 IncreaseEquities–40%to45%
ThecommitteewillreviewthesuggestedrevisionsanddiscussattheNovembermeetingbeforemakingadecision
torevisetheinvestmentpolicystatement.
BeginningofSchoolOverview–Mr.Solomonreportedthatschoolisofftoagreatstart.
AsofSeptember8,enrollmentof28,084isupby507studentsoverprojections.Thereisusuallyafalloffof
studentsbetweenthebeginningofschoolandOctober1whenthedistrictreportstheirofficialenrollment.The
October1enrollmentnumberswillbeusedtofinalizethe2015‐16budget.Onthefirstdayofschool,Cabinet
membersvisitatleastthreeschoolsatthebeginningandendoftheday.Itisalwaysanexcitingtimeforall!John
WollersheimsharethefirstdayatRosemountHighSchoolandhisphilosophyof“MakeitPersonal”
BondReferendum2015–AhandoutofthedistrictsPowerPointpresentation“SafeandSuccessfulSchools”was
shared.Thiswillbemadeavailabletoallsitecouncilandwillbesharedwithcommunitygroups.Mr.Solomon
showedtheBACwheretheinformationregardingtheNovember3,2015bondreferendumislocatedonthe
districtwebsite.TheBACviewedoneofthreevideosonthesite.Thedistrictwantstomakesurealladvisory
councilsareinformedaboutthelevyandpreparedtoshareinformationifasked.
Therewerequestionsaboutthetechnologyportionofthelevyandifpreschoolwasconsideredinthespace
needed.Solomondiscussedinsomedetailtheplanforrolloutofthedevicesandtheresponsibilitytheparents
takeonasaresultoftheirchildhavingadevice.Hehashadtheopportunitytoseefirst‐handtechnologyinthe
classroom.Ourdistrictdevelopedtheplantousetechnologyintheschoolsthenintroducedthedevices.Hesaid,
“It’snotaboutthedevice,it’saboutthelearning.”Atthistimethedistricthassevenclassroomsfortargeted
preschoolandwouldliketoexpandthattoonetargetedpreschoolclassroomforall18elementaryschools.This
hasbeentakenintoconsiderationintherecommendationforspaceneeds,butthedistrictwillnotbepreparedif
thestateapprovespreschoolforallstudents.
LevyCertificationProcess–Mr.Solomonhasbegunworkingonthelevycertificationprocess.TheSchoolBoard
willbeaskedtoadoptalevylimitationforPayable2016levyatitsSeptember28regularmeeting.Solomonwill
sharemoredetailswiththeBACattheNovembermeeting.AttheDecember14SchoolBoardmeetingthepublic
willhavetheopportunitytocommentontheproposedlevyandtheSchoolBoardwillbeaskedtocertifyafinal
levyafterinputfromthepublic.
2014‐15AuditUpdate–Ms.Johnsonsharedapreliminaryauditsummary.Basedonthepreliminaryauditthe
generalandcommunityservicefundsperformedbetterthananticipated.TheJune30,2015projectedfund
balancesincludespringbudgetadjustmentsandanestimated$7.50millionbetterperformancetobudgetsavings.
GeneralFundrevenuesof$322.47millionwereslightlyhigherthanexpendituresof$321.32million.Ms.Johnson
informedthecouncilmembersthatadraftcopyofthedistrict’s2014‐15ComprehensiveAnnualFinancialReport
willbepresentedtotheSchoolBoardatitsOctober26meetingwithapprovalexpectedattheNovember9
meeting.
FinancialPlan–Therehavebeennosurprisesfromtheauditandthereforenomajorchangestothefinancialplan.
Thedistrictwasanticipatingperformingbettertobudgetbyapproximately$7.5million,andthiswasprojectedin
thefinancialplan.Mr.Solomonremindedthecouncilthefinancialplanshowedatleasttwoyearswithoutneeded
budgetadjustmentsandthisshouldnotchange.Oncetheauditiscompleted,Mr.Solomonwillupdatethefinancial
planwithfinalnumbersandsharewiththeBAC.
Adjournment‐Themeetingadjournedat8:12p.m.ThenextmeetingwillbeNovember18,2015.Thismay
possiblybeajointmeetingwiththeLegislativeAdvisoryCouncil.