Mahtomedi Schools approves budget increase, restores activity bus service
The Mahtomedi Public Schools board approved mid-year budget modifications on February 24 that increase revenue by $763,000 while maintaining financial stability. The district also committed to reinstating bus service for after-school activities in response to student feedback.
The school board unanimously approved three major financial items during the meeting: $6,899 in donations and grants, the independent auditor's report, and revised budget projections for the 2025-2026 school year.
The budget modifications reflect updated information from the state and changes in enrollment and staffing. Revenue increased by 1.48% while expenditures rose only 0.8%, keeping the district's general fund balance above its required 8% minimum. The largest revenue increase came from state pension reform changes. Expenditure increases were primarily driven by salary, wage, and benefits adjustments tied to a newly finalized Education Association contract.
Auditor Jim Iikton of LB Carlson presented a "clean opinion" on the district's financial statements for the year ended June 30, 2025, meaning no significant problems were found. The audit did note a recurring issue: limited separation of duties in the business office. However, district leadership explained this is a cost-efficiency decision, as adding staff to address it would be more expensive than the risk it poses. The auditor confirmed this finding does not impact the district's bond rating or state compliance.
In a direct response to student concerns, the board voted to bring back bus service for after-school activities for the remainder of this school year and to budget for it permanently next year. This reverses a previous cost-cutting measure and addresses transportation barriers that were preventing student participation in extracurricular programs.
The board also heard positive reports from school visits, highlighting innovative literacy programs, strong special education interventions, and effective classroom management across district schools. Additionally, the Native American Parent Advisory Committee affirmed the district is meeting the needs of Native American students through programs focused on post-secondary preparation, academic achievement, and cultural awareness.
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Votes (3)
Approval of Donations and Grants for January 26
Dissent: None
Moved by Unknown · Seconded by Unknown
The board considered and approved a total of $6,899.00 in donations and grants. These funds are designated to support the district's mission and align with the specific wishes of the donors.
Approval of Independent Auditor's Report
Dissent: None
Moved by Unknown · Seconded by Unknown
Jim Iikton of LB Carlson presented the audit results for the year ended June 30, 2025. The district received an unmodified ('clean') opinion on its financial statements. The audit noted an issue with limited segregation of duties in the business office, a recurring 'reportable item' that the district has chosen not to correct by adding staff due to cost efficiency, instead relying on compensating controls. No other compliance findings were reported. The district's fund balance remained stable and within policy guidelines.
Budget Modifications and Updates
Dissent: None
Moved by Unknown · Seconded by Unknown
Tim presented reasons for budget modifications, including preliminary state numbers, enrollment changes, staffing updates, finalized labor contracts, and legislative adjustments like pension reform. Revenue increased by $763,000 (1.48%) and expenditures by $444,000 (0.8%). The largest revenue increase came from pension reform. Expenditure increases were mainly due to salaries, wages, and benefits. The revised general fund balance projection for 2025-2026 maintains the district above its 8% policy minimum. The board also committed to reinstating a bus for after-school activities and budgeting for it next year in response to student feedback.
Notable Quotes (7)
The district's financial report that I mentioned, we were able to issue a clean opinion that is defined as an unmodified opinion. It was the opinion you were looking for kind of going into this process, the cleaner clean opinion, not financial statement.
The district is... under a model of having inadequate segregation of duties or limited segregation of duties in your business office... the district, if you will, just based on pure observation is determined that that cost is not does not cost does not always the benefits don't always. Um so they're choosing not to.
So these reports let me just take a step back. These reports are being submitted to the state of Minnesota state auditor Minnesota Department of Education as well as OM which is office management budget federal government... probably the only factor those first three government agencies they they read it and say yep got it thank you so there's not a lot of change or impact on that particular state but could it could impact your bond rating um from that standpoint as a finding I in my 35 years of doing this have never that's a strong statement ever had somebody come to me and say oh yeah we got rid of that finding and improved It really doesn't impact at all.
one of the really important ones is when we start to get into the multi-year projections, we want to have a good base to start from... So every year of course you approve the preliminary budget and those and that's a great word because those numbers are very preliminary. We we have numbers from the state that are in that are not finalized. They change.
So revenue is increasing 763,000. So it's a 1.48% increase in revenue. So that's in the right direction. That's where we want to where we want to see that go. U we also had an increase of 444,000 or 08% on expenditures uh from that preliminary budget.
So it's kind of a swap so when we're paying this 088% that goes in as a any other tax with like things like that. We're paying point we're paying half that the unions are seemingly siding with half of that as part of the negotiations going forward. Um the there is a sub cost but the thing is when they're being paid by the state we're not paying that portion. So a lot of that subost is actually being wiped out by the state paying that portion of their normal salary.
No, we we do have that in. We're going to bring that bus back for the remainder of the year and we'll be budgeting for that for next year as well.
Ordinances & Resolutions (9)
States that school districts with 10 or more Native American students must establish an American Indian education parent advisory committee.
A 150-page detailed financial document prepared by the district and submitted for financial reporting recognition.
Federal regulations followed by auditors for the single audit of federal awards.
An accounting standard related to compensated absences, impacting financial reporting calculations.
District policy stating a minimum unassigned general fund balance of 8% of total expenditures.
A recently finalized labor contract, impacting budget updates.
Legislative priorities for the session discussed by the Legislative Committee.
Mentioned as an item for final reading, but no specific policy identifier provided.
Letters from students providing feedback on budget-related decisions, specifically regarding busing for activities.
Source document
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Other Topics from This Document
Educational Program Effectiveness and School Visits
District Enrollment Management and Future Planning
Financial Audit Results and District Fiscal Health
Budget Modifications and Long-Term Financial Projections
Transportation for After-School Activities
Legislative and Committee Updates
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