LINN — Linn R-2 Superintendent Bob James told board members at their Oct. 14 meeting that preliminary audit results show the district has a 35.36% fund balance.

“That’s very near our prediction of 35.3%,” he added, noting the audit took a little longer this year due to the inclusion of bond-related revenues and expenditures. “Outside of that, the audit went as smoothly as it has in the last several years.”

James noted he does not anticipate the fund balance changing much, if at all, as the audit is finalized. “There’s not really anything that could impact it,” he said. “It did take a little bit longer this year, but that was because they had to deal with all the revenues and expenditures associated with our bond progress. Other than that, we got another glowing report. The office staff did really well. If you’re not aware, they have about 150 checkpoints, and what our ladies do is go in there and make sure they are numbered one through 150, so as they ask for it, they just turn over each card and feed them exactly what they need. There were a few questions going back and forth for clarity’s sake, but I think we’re going to be looking good.”

Based on an increase in the district’s assessed valuation, James thinks the school will increase its fund balance somewhere between 35.36% and 40%, which is why he wants to be as aggressive as possible.

In related news, James said the bond budget looks good, noting a combination of being conservative up front, prudence with the district’s money, and trying to remain in the mid-range spending level has led to Linn being ahead of the game.

“I don’t want to call it a surplus, because surpluses can go away very quickly, but right now, we are just a little over a million dollars ahead,” he said, asking board members to think about district needs in the next month or two. “By the time we get to January, we’re going to be that way down the road on the addition.”

The only major project after that is the main parking lot. James said he’s already set aside funding, adding that the $1,034,000 surplus doesn’t include $100,000 in additional contingency funding for the parking lot. “If we don’t have to do soil remediation, we’re going to be in a good spot,” he added. “But, we also have our community group that talked about quite a few projects. We have phase two projects.”

One project is eventually moving the weight room downstairs. “It probably wouldn’t cost us a lot of money to demo and go ahead and get them out of the old maintenance shed,” said James.

Other improvements include redoing the basketball court at an estimated cost of $34,500 from Luebbert Flooring. “His price really hasn’t changed much in five years,” said James. “That’s a pretty substantial price, but they strip the floor bare and then paint it however you want it coming out, which would be nice.”

Other projects may include repairing the bleachers in the elementary school because they’re oversized and the gravel parking lot.

“The reason that we poured that was to accommodate summer school for next year when we redid the main parking lot so that we could use our new asphalt parking lot and the new entrance,” said James.

He also told board members he would like to consider sorting out the HVAC system, noting the field house and new addition are squared away.

Several units are 25 years old, and one will have to be replaced for $15,000. He noted that replacing all the high school units would cost between $350,000 and $400,000, but the system would last for a decade or two.

James also wants to look at doing a bit of aesthetic work on the old maintenance shed, along with improving the softball/baseball press box, and perhaps replacing some broken bleachers. “We have a lot of options,” he said.

He noted the football boosters have been carrying the water on almost all of the football projects. “I know they tried to raise money to level and irrigate the practice field up top,” said James, explaining the cost would be about $45,000. “That’s still a lot of money, but that’s only about 4% to 4.5% of our current surplus. I’d love to see us meet them halfway, or more than halfway, quite honestly, because we’re way behind it.”

James asked board members to let him know their priorities so he can develop a work plan that is most beneficial to students and staff. He explained he’s asking now because in January, the district will have 18 months to spend the money, including planning, design work, and bids. “We will run out of time very quickly,” he said, adding that the money must be expended by summer 2027.

* James also told the board that base salary is still the district’s top concern going into next year’s budget season, when the minimum base will be $41,200, up 3%. “It will continue to climb,” he said. “As it is right now, we’re still at $37,000. I’m hopeful that we’ll make a significant advance without unbalancing our budget. But right now and for next year, the only thing that will keep us afloat is the federal minimum base salary grant administered by the state. If that folds, we’ll be looking at it eating away at our fund balance. They’re not going to change the legislation. I’m hoping they’ll reconsider the 3% advance every year, but right now, we are not funded in a way to maintain the state mandate.”

James estimated the district could survive using reserve funds for about three years if the grant goes away, at which time he believes Linn would be at about the state target of 20%. “If we start chipping away 3% to 5% every year, within seven years, we will be financially insolvent — not because we’re fiscally mismanaging, but because they pass the law on us.”

* To counter the unfunded mandate, James told board members to strongly consider going back in April to ask voters to approve a levy increase. “Our recent AV put us closer, but we still have a significant deficit,” he said.

He plans to offer contingencies for whether the measure passes, adding that if the board decides to run another levy election, the school would need to declare that intent in December and file paperwork.

* Board members held a third and final reading of the Missouri Consultants for Education (MCE) policy updates.

* The school has a checking and investment balance of $1,643,337.04, including investments of $509,177.13 through Mid America Bank.

Remaining business will be presented next week.