Saving Cash For Rainy Day
All of us, upon finding more money than expected or needed in our checking accounts, are tempted to go shopping. Experience teaches us we never know what is around the bend, however. Socking some or all of that surplus cash away for a rainy day is the wise course of action.
That is how Martins Ferry Board of Education members ought to plan their finances during the next few years. It appears the school system is in good shape fiscally — but that could change, perhaps dramatically.
During their meting last Thursday, board members approved a five-year financial forecast. They were told a reappraisal of property values, as well as an increase in revenue from mineral rights, are improving income for the current year.
Bottom line numbers provided by Treasurer Dana Garrison look good for the next few years, in fact. Garrison estimates the district’s general fund balance will be $5,580,816 for this year, $5,630,233 for 2020 and $5,367,783 for 2021. But then, the fund experiences a drain, going down to $4,537,791 in 2022 and $3,138,416 the following year.
There was good news on one perennial fiscal headache: The cost of providing health insurance for district employees is expected to increase by only about 3.8% next year.
With current numbers like those board members are seeing, there may be temptation to engage in capital spending — big-ticket items that could improve the education Martins Ferry students receive. But recent experience — namely the need to spend about $7 million to replace relatively new school roofs — ought to restrain that impulse.
So should the very real possibility that expenses such as health insurance could increase dramatically.
The prudent course of action would be for board members to build up an emergency reserve for unforeseen circumstances. The fiscal sun may be shining now — but dark clouds for the school district could be just over the horizon.