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March 8 - Committing resources to district priorities
At North Branch Area Public Schools (NBAPS), one of our strategic commitments is to allocate resources to district priorities. We are thankful for the community's investment in our buildings from the 2017 bond referendum. When bonds are issued, as NBAPS did in 2017, external investment groups provide ratings to bond investors. A positive or improved bond rating signals to investors that their money is safely invested. Last week, Moody’s Investment Services informed NBAPS that the school district’s bond rating has improved from Baa1 to A3. Moody’s noted the district’s fiscal responsibility and enrollment growth as reasons for the upgrade. This is the second increase in our bond rating from Moody’s in the past three years.
Fiscal responsibility is critical to the success of our school district. The upgraded rating of A3 reflects the district's continued growth in reserves through careful management of our funds and improved enrollment trends.
Previously, our school district operated with a fund balance policy of maintaining 5-10% in reserves. School districts with a low fund balance frequently need to cash-flow borrow because the timing of the expenses of a school district are not aligned with the revenue received from the state. Over the past three years, our School Board made the decision to revise our fund balance policy to shift from the previous range of 5-10% in reserves to 10-15% reserves in our unassigned general fund. We are currently operating within the board approved range of 10-15%. This has allowed us to stay away from cash-flow borrowing, and the associated fees and expenses, better committing our resources to district priorities.
Committing resources to district priorities was evident in our response to COVID-19. We carefully allocated our one-time federal funding for COVID related expenses to keep students in school while the majority of the country defaulted to distance learning as the only option for students and families. According to the Association of School Business Officials, having school in person during the pandemic had an estimated additional annual cost of 1.3 million annually for a school district our size. That estimate proved to be very accurate in our case. Our commitment to provide both in-person and distance learning options for families provided predictability and quality learning options as we navigated through challenging times. As this one-time COVID relief federal funding comes to an end, we are working carefully to provide an off ramp to these funds to avoid a spending cliff that some other districts are facing at this time.
We embrace choice, and our commitment to being at the forefront of educational excellence is drawing families to choose North Branch Area Public Schools. Our current enrollment growth is coming from families choosing to be part of our school district after previously opting for a different school option. We have well maintained buildings with expanded community use. As our community grows, we are beginning to see families moving into our area and we are proud to share what it means to be a Viking.
The improvement to our bond rating is an important indicator that we are moving in the right direction. Continuing to commit resources to district priorities is critical to our success and it is a privilege to move forward together at the forefront of educational excellence!