Charles Warner Editor
December 11, 2013
UNION COUNTY — Its fund balance enables the Union County School District to save money by not having to borrow to cover operating expenses during the first part of its fiscal year according to Finance Director Lynn Lawson.
In his monthly budget report to the Union County Board of School Trustees, Lawson pointed out that as of Nov. 30 the district appears to be $2.5 million in the red. Lawson said this is not the result of any shortfall in the district’s funding sources, but is an expected part of the budget cycle that occurs every year. He said this is due to the fact that the district does not begin receiving the majority of its local and state funding until nearly the end of the first half of the fiscal year.
“Our revenue is $2.5 million in the red on paper, but that is what we expect this time of the year because of our cash flow cycle,” Lawson said Monday. “We receive lump sums of state and local funds in the December to February time period.
“So we are on budget,” he said. “At this time our revenue is on target and our expenditures are consistent with what we expect to see this time of the year.”
Lawson said that it’s because of the realities of the funding cycle that he emphasizes the importance of the district maintaining its fund balance which he said currently stands at $2.2 million.
“Because of that I emphasize how important our fund balance is,” Lawson said. “That fund balance allows us to make it from July to this time period without borrowing to pay our payroll or other operating bills.”
Lawson added that by using its fund balance until local and state funding begins coming in, the district actually saves money.
“It costs you money in interest to borrow that money,” Lawson said. “So having a fund balance allows us to save money.”
Editor Charles Warner can be reached at 864-427-1234, ext. 14, or by email at email@example.com.